When Dr. Stephen Lohr began practicing medicine 25 years ago, the medical field barely resembled what it is today.
“In 1980, all you had to do was worry about medicine,” Lohr recalls. “You had to know what to do with a particular problem. Now, not only do you have to know what to do with a particular problem (and orthopaedics has advanced dramatically within the last 25 years), but also, reimbursements have gone down dramatically, our costs have gone up, so we have to operate much more efficiently. There’s a huge difference.”
To keep up, Lohr has found he must incorporate tried and true business principles into his practice, strategies he admits he didn’t learn in medical school.
Lohr is CEO of Omni Orthopaedics, which, with a staff of 92, is one of the two largest orthopaedic practices in the area. Omni grew out of the 1996 merger of Stark County Orthopaedic Association (a practice that started in the 1960s) and Belden Village Orthopaedics (the three-person practice Lohr worked for). Today, Omni is based in the Belden Village area of Jackson Township, in the Omni Medical Center, and has satellite offices in Alliance, Carrollton and Massillon.
“The biggest reason we merged was that if there were more of us, we could attract and support subspecialists,” says Lohr. “With just the three of us, we could not attract and support, say, a hand surgeon or a spine surgeon. It provides better orthopedic care if you have subspecialists in your group.”
In fact, Omni continues to subscribe to ongoing expansion in order to stay competitive. While the practice employs 12 physicians and two psychologists, Lohr hopes to hire two more specialists (a spine surgeon and a total joint surgeon) within the next year.
Lohr says the national trend in the medical industry is toward larger group practices, both as a way to control costs through efficiency and to offer patients a wider range of specialized services.
“There are groups that will have 40 or 45 orthopaedic surgeons,” he says. “Groups are getting bigger and bigger to provide better care, with subspecialists in with general orthopaedic surgeons.”
But as these practices grow, so does the need for business know-how. When Omni was founded in 1996, the partnering doctors hired Raymond Zinicola to run the practice from the business side.
As the highest ranking nonphysician in the practice, Zinicola, who had no medical background but used to run a large real estate holding company, handles the day-to-day operations of the business as well as the accounting side.
“They’re not business people,” Zinicola says of the physicians he works for. “Their role in life is to take care of patients. We’ve been able to relieve them of the burden of running the business on a day-to-day basis. My expertise lies in business systems, accounting and computer technology.”
The right systems
One of the areas Zinicola developed and has continued to improve upon for the practice is the computerization of its processes. When the practice was founded, Lohr cited a lack of computerization as the biggest potential obstacle to running the business.
“Ten years ago we did all of our billing by hand,” Lohr says.
Today, Omni has surpassed its competition in that area.
All of the software programs Omni uses have been specifically written for the practice. For instance, the program used to record and chart patient outcome studies, which, through a database, follows the progress of patients years after treatment, is unique to Omni.
Zinicola says the surgery scheduling software that Omni uses, also written specifically for the practice, has enabled the business to run more efficiently.
This year, he hopes to begin using specially created software to keep electronic medical records. He says that within the next few years, the office should be almost completely paperless.
“Medicine is changing on a daily basis; we have to run things more efficiently to stay autonomous and still provide excellent care,” he says. “We have to become more efficient.”
He says that as more processes become streamlined and automated, more staff can move from the clerical side of the business to the clinical side.
“We’re doing that through technology,” he says. “We’re not necessarily cutting back on staff, but we can free up more of the clerical staff to do more clinical work if we automate what they’re doing.”
Give the people what they want
Omni has remained competitive by responding to patients’ needs, both on the medical side and the business side. As a health care provider, Lohr stresses the importance of offering a wide scope of subspecialists who can meet almost any orthopaedic need. By continuing to expand the practice, Omni is able to hire more specialized physicians.
In addition, it runs its own ambulatory surgery center and will open a physical therapy center this month.
To attract as much business as possible, medical practices must have physicians contracted with the major managed care organizations, which Omni does.
“We have somebody who’s on virtually every managed care panel there is,” Lohr says. “The biggest insurer in Stark County is AultCare. Six of our orthopaedic surgeons are on the AultCare list right now.”
As CEO, Lohr must also respond to patients’ demands of Omni as a business. In a rare move for a medical practice, this month Omni will begin offering evening hours to cater to working patients who find it difficult to make a weekday doctor’s appointment.
From 5 to 9 p.m. two evenings week, Omni physicians will be available to see patients with new problems, Lohr says. Like other changes at Omni, extended hours should help with both efficiency of staff and attracting new patients, he says.
“In other parts of the country where people have tried this, it’s been effective and well received,” he notes.
An eye toward the future
Lohr says awareness is one of the best ways to stay competitive in the medical industry.
“There are trends that are happening with groups our size throughout the country, even though the local insurance situation is different everywhere,” he says.
One of the trends Lohr has observed is the merging of small- and middle-market practices to create larger practices that offer more specialties. While Omni plans to continue to grow, Lohr says the practice must grow geographically as well so not to saturate one market.
“Right now we’re growing to accommodate our needs. We fill our needs as they arise,” he says
The ability to grow is predicated upon the local population. “The local population would not support 10 more orthopaedic surgeons in this town,” he says
To counteract that, he plans to open satellite offices, starting in Tuscarawas County, by end of the summer.
Lohr admits no business plan is fail-safe, especially in these changing times. “We’re having a hard time, just like everyone else,” he says. “I have no idea what the future holds. The reimbursement from insurance companies has gone down, Medicare has gone down. I don’t know what’s going to happen five years from now. There’s not a whole lot you can do about that.
“The only thing you can do is to try to be as efficient as you can.”
How to reach: Omni Orthopaedics, (330) 492-9200