10 Ways to Improve Profitability for Pain Management

December 01, 2011 | Print  |

Pain management is a specialty in flux. Not only are more chronic pain sufferers seeking out treatment, but the release of a recent Center for Disease Control report, which found more people die from prescription drug overdoses than heroin and cocaine combined, has created a backlash over opioid prescriptions and a call for alternative treatments.

"We're in an era where pain management is high profile," Robert Saenz, CEO of Tulsa Pain Consultants and president of VIP Medical Consulting, says. "There are many more patients walking through the door. I believe that out of chaos, there is opportunity."

Richard Kube, MD, CEO, founder and owner of Prairie Spine and Pain Institute, says part of that opportunity is creating an integrated pain practice.

"There's a vast opportunity to capture a market which is a very, very good performance margin for your practice," he says.

By changing the way Tulsa Pain Consultants operated, Mr. Saenz increased the center's revenue by about $10 million annually. Here are 10 steps for a pain management center to increase profitability. Some of these are easy fixes, such as automating telephone calls, and others involve a fundamental shift in the way a practice operates.

1. Increase patient volume. The first step to increasing profitability in a pain management practice is to generate more patients, says Scott Anderson, COO, Prairie Spine and Pain Institute. Most patients come to a pain management practice on referrals from primary care physicians, so one way to increase patient volume is by generating more referrals from primary care physicians.

"When you're considering generating new patients, the clinical model is as important or more important than any other component of the practice," he says. "What clinical services are you going to provide that create a unique story that makes the referring physicians want to send you 100 percent of their patients with a pain condition? When you have built a strong relationship with multiple providers, your interventional business will be dramatically enhanced."

2. Hire a physician liaison. Once a practice establishes what primary care physicians want and works toward providing that, someone has to tell the primary care physicians that the services are available. Hiring a physician liaison is an effective way to do this, says Mr. Anderson.

"This person should be out in the field five days a week, buying lunches for and interacting with the primary care physician community," Mr. Anderson says.

A well trained and highly motivated physician liaison should be able to add 50-75 referrals to your practice (or ASC) every month. The ideal person for the job holds a four-year degree in an allied health field such as functional or behavioral health. They should have an outgoing personality and be very comfortable meeting and speaking with people. Mr. Anderson says to stay away from people with nursing degrees or experience as a pharmaceutical representative.

3. Communicate with primary care physicians. Communication with primary care physicians who refer patients is key and will ensure that physicians continue to refer to your facility, says John Bookmyer, CEO of Pain Management Group, a management company in Findlay, Ohio.

"Providing timely reports and updates to referring physicians and primary caregivers and specialists is critical and included in every step of our pain management care plan," he says. "We see our relationships with referring physicians as partnerships. They know their patients' history and needs, and we bring insight, support and treatment to an area that many primary care physicians do not have training and a comfort level with."

4. Provide the referring primary care physicians with the clinical services they want. This is where many pain practices have fallen short, Mr. Anderson says.

"The number one thing a primary care physician is looking for is to meet the needs of their chronic pain patient population by taking over the management of that patient's condition," Mr. Anderson says. "When you take over the management of that patient's condition, you will see a significantly higher number of referrals."  Of course you will need to build a team to manage this new influx of patients and their unique needs, as your specialists cannot afford to coordinate care for this patient population.

Dr. Kube estimates that 95 percent of pain management practices operating today are moving toward a procedure-based model instead of an integrated care model.

"A lot of the pain practices are trying to become very much in tune with and involved with doing procedures all the time," he says. "As such, the very reason for primary care physicians to refer the patient to you in the first place is being diminished by most pain practices. Chronic pain management is a part of pain management. If you're going to be a pain center, you really have to do all of it."

Providing comprehensive pain management services also ensures that practices aren't losing pieces of revenue such as physical therapy, behavioral therapy, durable medical equipment and other clinical services. With this model, Mr. Anderson estimates the revenue per patient life will grow from $2,500 to $10,000-15,000 using a fully integrated facility based care model

5. Maximize physician case load. Once the practice establishes a pipeline for referrals, all the physicians need to be working at their capacity in order to maximize procedures and make sure the practice can handle the increased case load. One way to do this is by ensuring every staff member is working at his or her pay grade, says Mr. Saenz. For example, physician assistants should not be taking patients from the waiting room to the procedure room. A less-qualified staff member can handle that so the physician assistant can concentrate on higher-level tasks. This will trickle up to the surgeons themselves, and they will have more time to be doing procedures, Mr. Saenz says.

Although he has found resistance among physicians, Mr. Saenz says increasing case load is not about rushing procedures but rather speeding up the other aspects of a visit such as registration, insurance verification, setting a patient up in a room and discharge.

"If you reduce the wait time, you're able to accommodate more flow," he says. "Pain management is a volume-driven practice. Let's say an epidural steroid injection could take 10-15 minutes depending on the doctor, if you add on another 15 minutes of unnecessary processing time, you just cost yourself one more patient that you could have seen. If you can add one patient per hour, that's 15 more procedures a week. If you do the math, it starts accumulating over a year."

6. Offer cutting-edge treatments. Part of creating a unique story for referring physicians is being able to perform all pain management procedures such as spinal cord stimulator implants and radiofrequency ablation. Mr. Saenz says the returns for physicians are favorable for both of these procedures.

Francis Riegler, MD, co-founder of Universal Pain Management, says that because there are only three medical device manufacturers of spinal cord stimulator devices, the market is highly competitive. He recommends practices check with other vendors in their area to make sure they are getting the best price. There are also rebate programs for these devices.

7. Incorporate anesthesia. Mr. Saenz has also seen some practices incorporating anesthesia into some of their procedures when it's medical necessary. Anesthesia can add increased revenue when compared to no sedation or conscious sedation.

"The important thing to remember here is that this has to be based on a patient-by-patient case and strict protocols should be adhered to in order to abide by regulatory requirements and standard of care," says Mr. Saenz.

8. Maximize the center's use of space. At Tulsa Pain Consultants, Mr. Saenz evaluated every inch of space within the center including the large conference room that was not bringing in any revenue, he says. After converting the room into two additional procedure rooms, the practice cut its wait time from eight weeks to five days.

"That just enhanced our volume intensely," he says.

9. Automate reminder phones calls. When Mr. Saenz arrived at Tulsa Pain Consultants, reminder phone calls were made by operators. He set up an automated system that reduced the cost of the hundreds of daily calls to pennies, he says. Patients would press a button to indicate that they weren't coming, and a scheduler would call them back. The practice was able to reduce no-shows this way.

"By plugging that flaw, we were able to keep the schedule full," he says. "We got rid of last-minute holes. The schedule is the most important part of flow."

10. Double-check all reimbursements. Receiving proper reimbursements is essential to profitability, and making sure staff is well-trained can ensure reimbursement is done correctly.

"We encourage well-trained preauthorization and registration personnel to ensure compliance with payor agreements when scheduling patients," says Mr. Bookmyer. "In addition, we have equally well-trained physicians help manage denials when received after service."

Mr. Saenz recommends that the contracts with payors are double-checked to make sure the practice received the agreed-upon reimbursement for every procedure. He also warns physicians to make sure they are coding their procedures correctly.

"In many cases, we find that they're undercoding," Mr. Saenz says. "Sometimes doctors become so intimidated that they tend to undercode, and they're hurting themselves and their profitability. All these changes and tweaks may sound like small dollars, but when you're treating thousands of patients, these dollars add up to significant revenue."

Learn more about Pain Management Group.
Learn more about Prairie Spine and Pain Institute.
Learn more about Universal Pain Management.
Learn more about VIP Medical.

Related Articles on Pain Management:
10 Steps Taken By Top Performing Pain Management Programs
8 Myths About Pain Management
Pieces of the Puzzle: Creating a Multidisciplinary Approach to Pain Management

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