New ASPS initiative seeks to help private practices survive and thrive

Mike Stokes
03/18/2013 at 10:00AM

The rise of cosmetic medicine franchises, an extended period of economic decline, sweeping changes to the U.S. health care system and myriad other competitive challenges are threatening the sustainability of the private practice model that has long been a hallmark of the specialty. To neutralize these threats, ASPS is launching a Management Services Organization (MSO) later this year aimed squarely at reducing operational costs, offering consultative support and providing capital for plastic surgery practices to expand.

The first phase of the MSO also includes an ambitious new marketing initiative designed to level the playing field for plastic surgeons facing growing competition that includes the heavily advertised corporate facelift factories and liposuction centers.

The initiative, which is designed to create economies of scale by pooling the resources of its members, will be administered through Plastic Surgery Business Solutions, the for-profit subsidiary of ASPS that recently launched Access Medical Purchasing (a 2,700-member group-purchasing organization) in 2011 and partnered with eClinicalWorks to offer an electronic medical records (EMR) system specifically tailored to the needs of plastic surgery practices (see article on page 13).

"The MSO is effectively a co-op of ASPS members for aspects of practice where collaboration will improve economies of scale," says ASPS President Gregory R.D. Evans, MD, who also sits on the PSBS Board of Directors. "Participation is purely voluntary, and those who do participate can pick and choose the areas of benefit to their own practice.

"The objective is to harness the collective power of our membership to establish a national infrastructure that can achieve economies of scale for private practices," he adds. "This will make ASPS members who choose to participate more competitive against the wannabes."

PSBS Board member Michael La Penna, a consultant specializing in business development and strategic financial planning for health care providers, likens the MSO concept to a modern-day grange. Instead of independent farmers, however, it will be composed of plastic surgeons gathering to work through common problems and share the costs of expensive pieces of equipment.

"Physicians are fiercely independent, but they sometimes need to come together to really make their businesses work and to achieve some levels of scale that an independent practice might not otherwise be able to achieve," says La Penna. "It's a simple concept being played out in the very complex environment of medicine."

A primary purpose for developing the MSO is to enable small practices - in which a majority of ASPS members practice - to survive and maintain their autonomy in an increasingly hostile business environment.

"Private practitioners are under attack," says Scot Glasberg, MD, ASPS vice president of Health Policy & Advocacy and a member of the PSBS Board. "Given the direction of health care reform, the ability to sustain a private practice - especially a solo practice - is going to be hurt unless we can provide services to the members that will help them maintain their practices in a very competitive environment."

"The changing medical environment has really allowed us to look outside the box of a usual organizational structure," adds Dr. Evans. "As a separate entity from the Society, PSBS allows us to provide unique opportunities that most organizations are not able to offer their membership and, hopefully, will make ASPS members more resilient amid all of the changes coming down the pike."

Marketing muscle
A national advertising component is a key feature of the MSO's rollout. It is designed to give practices the same level of paid media exposure as national and regional cosmetic franchises, such as Lifestyle Lift®, QuickLift® or Sono Bello®. This will allow participants to market themselves as board-certified ASPS Member Surgeons under a distinct brand that will be supported by pooled advertising dollars - and drive potential patients to their local ASPS member's practice.

"Clearly, plastic surgeons have seen companies like these take off simply because of their marketing dollars," adds Dr. Glasberg. "ASPS understands that individual members can't compete against that, so the Society feels an obligation to help them take on those types of entities in the marketing arena. Since we have the really strong credibility and quality behind us, we should be able to do that, and our members will benefit from that marketing."

"In California, Lifestyle Lift and Sono Bello are examples of two businesses that have both penetrated the airwaves and print, but it doesn't matter where you are - if you're in a metropolitan area, you're probably seeing these corporate models popping up," says ASPS immediate-past President Malcolm Roth, MD, who is also a member of the PSBS Board. "It's very difficult for an individual member, or even a group, to compete with the marketing clout of a nationally syndicated corporate model."

Dr. Roth notes that during his presidency, numerous ASPS members shared with him their concerns about the impact of such corporate cosmetic franchises on their local practices.

"This is something that we needed to do and, hopefully, the fact that we have 7,000 members will give us leverage," he says. "We're optimistic that this will make a difference for our members and allow them to capture what they should be capturing, which is the lion's share of patients who are interested in getting quality plastic surgery."

"There are other organizations that are very good at promoting plastic surgery and getting people into these pseudo-practices," says Dr. Evans. "We have an opportunity to do that as well with legitimate, board-certified plastic surgeons who practice in accredited facilities - and doing so also brings value to the public."

While plastic surgeons often view each other as competition as well, Dr. Roth points to past advertising alliances among ASPS members in Sacramento and Dallas as precedents that show the utility in working together while remaining independent.

"Trying to get a group of solo or small practices to market together when they perceive one another as competition has been a challenging proposition," he admits. "But I think there is a greater willingness among ASPS members in the same community to work together to set the ASPS brand above the rest of the pack."

Reducing overhead
To help practices stabilize or reduce overhead costs, the MSO will also offer a number of professional services ranging from medical billing and claims processing to personnel management and credit card processing. Outsourcing these and other management functions to companies that have been researched and vetted by the MSO will also reduce the amount of time plastic surgeons must spend handling administrative duties and allow them to spend more time in the O.R.

"We're going to look for the best biller, the best legal services, the best office employment management company - we've gone through this process already with the eClinicalWorks EMR," says Dr. Glasberg. "A private practice that might be drowning in expenses could potentially streamline itself, right the ship and continue moving forward by outsourcing these things. When one large group in the Northeast heard about this, they were very interested to see if they could eventually outsource the entire running of their multi-surgeon group to the MSO.

"It would also allow the surgeons to focus on clinical work," he adds.
Returning to the grange comparison, the MSO will also facilitate sharing of new equipment, O.R.s and other significant expenditures among plastic surgeons in the same area.

"What we're hoping to be able to do through PSBS as an intermediary, is allow individual practices to share expenses in a more collaborative way," says Dr. Roth. "It doesn't make sense to have a laser that sits idle for six days a week when that laser can be in use Monday through Friday by sharing with four other practices."

In many cases, the MSO would allow plastic surgeons to outsource virtually all management tasks. On an even grander scale, a planned component of the MSO provides plastic surgery practices access to capital to expand, or even partner with PSBS in the joint ownership of ambulatory surgery centers.

"It's a big undertaking," says La Penna. "Other national societies are going to watch very closely to see how this works."

Economic reality
Members of the PSBS Board say the launch of the MSO has been driven by the needs and desires of ASPS members fighting to continue practicing medicine on their own terms amid a tumultuous medical and economic landscape.

"During my 25 years of practice, there have been several down economic cycles - they would last a year or two and people would tighten their belts, but we knew that it was going to bounce back," says Dr. Roth. "This time, the economy hasn't come back so quickly. Now you also have the growth of corporate models and increasing expansion of the wannabes, so there is more competition for fewer patients."

By consolidating efforts with other board-certified plastic surgeons, ASPS members will be in a better position to compete and eliminate the need to merge with another practice or hospital.

"This is another example of how ASPS is truly a member-driven organization," notes Dr. Roth. "We have staff working for us to try to help our members thrive, and we are not only responsive to our members' concerns, but we're able to anticipate their future needs. Because of the incredible staff we have, we're seeing ease of implementation of some very far-reaching goals, which would not be possible without the close collaboration of our membership, leadership and Executive Office staff."

"This is really a way to see if ASPS can help out in a very tight and difficult market," says Dr. Evans. "It's really exciting to be a part of an organization that's willing to attempt to do this for its members on a real, practical level. It's something that organizations usually don't do, but I think it's going to be a great value for our membership."