EndoEconomics Spring 2015

SPRING 2015A Journal Dedicated to Economic Issues Impacting GI ASCs and Practices

Advocate Health Care, Illinois Successful 3-Party

Joint VenturePage 6

The GI Journal of: “Improving the landscape of healthcare one surgery center at a time.”

Legal Considerations When Selling ASC Shares

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Alternative ASC Anesthesia Models

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SPRING 2015 EndoEconomics | 3

CONTENT

4 MESSAGE FROM THE PRESIDENT 6 ACHIEVING GREATER SUCCESS THROUGH A THREE-PARTY

ASC JOINT VENTURE 9 DOMINOES ARE FALLING: POSITIONING YOUR ORGANIZATION

TO WIN IN TODAY’S HEALTHCARE 11 LEGAL CONSIDERATIONS WHEN SELLING SHARES IN AN

AMBULATORY SURGERY CENTER 15 DEFINING HR: WHY SMALL BUSINESSES NEED HUMAN

RESOURCES SUPPORT 17 IS IT POSSIBLE TO PROFIT FROM ANESTHESIA: ALTERNATIVE ASC ANESTHESIA MODELS 19 FRONT AND CENTER: EXPLORING GI CENTER COLON

CANCER AWARENESS INITIATIVES 21 GROWING YOUR INVESTMENT: THE STAGES OF MARKETING

A MEDICAL PRACTICE 24 BUSINESS BRIEFS 26 CURRENT GI OPPORTUNITIES

SPRING 2015

SPRING 2015 ISSUE

EndoEconomicsby Physicians Endoscopy

Editorial Staff

Carol StopaEditor in [email protected]

Lori TrzcinskiManaging [email protected]

EndoEconomics™, a free quarterly publication, is published by Physicians Endoscopy, 2500 York Road, Suite 300, Jamison, PA 18929.

The views expressed in this publication are not necessarily those of Physicians Endoscopy, EndoEconomics™ or the editorial staff.

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In this edition, there are two topics I would like to address. The first is a GI focused conference that takes

place each year in the spring known as the GI Roundtable, or GIRT for short. This conference was originally the brainchild of Drs. Klaus Mergener and Gene Overholt—neither of whom need further introduction as they are well known as thought leaders within the GI community. The conference, originally held in Knoxville, TN, has grown in size and for the past several years has been held in Boston.

Last year Dr. Overholt retired as Co-Chair of the conference with Dr. Mergener and handed the reins to Dr. Tom Deas. During the last week of March 2015, I once again had the plea-sure of attending this important annual event. As has become the custom, Drs. Mergener and Deas did a magnifi-cent job of orchestrating this two day meeting which included a well thought-out agenda filled with current topics of interest to all gastroenterolo-gists. The theme for this year’s confer-ence was “Pursuing Opportunities In Times of Change”. There were several keynote speakers such as M. Bridgett Duffy, M.D., CMO of Vocera Communi-cations; Harold D. Miller, President and

CEO of Center for Healthcare Quality & Payment Reform; and even Tadatka Yamada, M.D., former President of the Bill & Melinda Gates Foundation Glob-al Health Program, just to name a few.

The reason I want to take this opportu-nity and draw attention to this confer-ence is that we are all grappling with a changing healthcare landscape. It is just this sort of opportunity where GI thought leaders, healthcare sector ex-perts and practicing gastroenterolo-gists gather to share information, ex-change ideas and best practices that is so inspiring and energizing. Whether you are a practicing gastroenterologist or an industry participant trying to help bring value to the GI specialty, such as Physicians Endoscopy, this is just a great forum to listen and to learn.

While all of the sessions were terrific, I was particularly intrigued by the pre-sentation offered by Harold Miller. Prior to the conference I was unfamiliar with the Center for Healthcare Quality & Payment Reform (www.CHQPR.org). Mr. Miller’s presentation was entitled Win-Win-Win Approaches to Account-able Care – How Physicians, Hospitals, Patients and Payers Can All Benefit From Healthcare Payment & Delivery Reform. Although abbreviated due to time constraints at the conference, all 265 slides from Mr. Miller’s presenta-tion can be found at www.chqpr.org/downloads/HaroldMiller-GIRoundta-ble-03-28-15.pdf. I was so intrigued by the presentation that I printed out the entire presentation and went through

it page by page the day after the con-ference. My brain has been working in high gear ever since. I definitely can’t do the presentation justice in a few words, except to say that the key take away for me was that in almost every alternative reimbursement model that is currently being explored there are winners and there are losers.

It is clear to me, which is one of the many reasons that I want to help GI physicians and physicians in general remain independent, that physicians have the ability to be the biggest fac-tor in controlling the cost of care, and yet there is very little incentive for them to do so. The whole concept of creat-ing a win-win for physicians, hospitals, payers and patients and working to-gether in a collaborative manner to do so is just so simple, and yet so novel. I won’t belabor this much further, but I do want to thank Drs. Mergener and Deas for co-chairing such a wonderful conference, and I want to encourage all GI Physicians to make room on your schedule next year in March/April and attend this event.

The second topic that I would like to address is the SGR fix legislation known as HR 2, or Medicare Access, and the CHIP Reauthorization Act that was recently, overwhelmingly (392-37) approved by the House on Thursday, March 26, 2015. This important bi-partisan legislation – co-sponsored by House Majority Speaker John Boehner and by House Minority Leader Nancy Pelosi – would finally remove the dark

PresidentBarry TannerPresident and CEO, Physicians Endoscopy

4 | EndoEconomics SPRING 2015

Messagefrom the

www.chqpr.org

www.chqpr.org/downloads/HaroldMiller-GIRoundtable-03-28-15.pdf

cloud of an approximate 21% reduction in physician fees that has existed since a 1997 deficit reduction law. This law called for setting Medicare physician payment rates through a formula based on economic growth, known as the sustainable growth rate or SGR for short.

Since its implementation, Congress has authorized 17 separate short-term fixes to prevent payment cuts to physicians. The most recent patch expired on March 31, 2015. Unfortunately, as of this writing, Congress re-cessed on Friday, March 31st without debating or vot-ing on this current proposed legislation. As a result, the scheduled 21% cuts to physician fees technically went into effect for services provided beginning on April 1st. CMS has already reminded providers that electronic claims are not paid earlier than 14 calendar days (29 days for paper claims) after the date of receipt. So, applicable claims for services from April 1st and beyond will be held until the Senate reconvenes on April 13th. If the Senate acts very quickly when they return from recess, to either vote for another short-term patch or to approve the repeal of the SGR, then providers will hopefully not experience the reimbursement cuts.

In fact, the House passed a version that would not only eliminate the SGR, but would also give physicians a 0.5% increase for each of the next five years as Medicare at-tempts to transition to a payment system designed to reward physicians based upon quality of care versus the quantity of services provided. There is also a provi-sion to provide an additional 5% bonus to providers who receive significant reimbursements from a patient centered medical home model or another alternative val-ue-based payment model.

You are probably beginning to see a common thread between my intrigue with the Harold Miller presenta-tion and the HR 2 legislation. Although there appears to be strong bi-partisan support within the Senate for the legislation, there are those on both sides of the aisle expressing concern. The biggest issue is, of course, none other than money. The cost of the SGR fix, estimated to be approximately $200 billion over the next ten years, was not designed to be fully paid for. In fact, the Congressio-nal Budget Office estimated that the legislation would add $141 billion to the Federal deficit since only approximately $70 billion of the total estimated cost would come from changes governing Medicare beneficiaries and providers. However, there are other concerns as well. The House Bill, for example, only extends for two years funding of CHIP, the Federal program that provides insurance for low-in-come children whose families earned too much money to

qualify for Medicaid. By the time you read this, I anticipate that there will be resolution to the SGR in some form, or at least that is my fervent hope.

I would like to conclude by announcing we are very proud to have added new ASCs to the Physicians Endoscopy family of partnered ASCs. In February we opened Greater Gaston En-doscopy Center in Gastonia, NC. This beautiful new facility was nearly five years in the development process due to challenges faced in securing CON approval. After such a long protracted struggle, we are so proud of our physician partners for their un-dying support and their continued dedication towards making GGEC the best facility in the Greater Gaston area. Also in Feb-ruary, we proudly added PGC Endoscopy Center, a wonderful and successful GI focused ASC jointly owned by the physicians of Philadelphia Gastroenterology Consultants in Philadelphia, PA. And finally, at the end of March, we teamed up with the physicians of Gastro-Intestinal Associates, Inc. of Lima, OH, and acquired an ownership interest in their very successful GI ASC known as The Endoscopy Center of West Central Ohio. We are privileged to be partnered with each of these facilities and all of the physicians who have worked so hard and contributed so much to making them successful.

I hope that you will enjoy this edition of EndoEconomics!


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“We had a good foundation for DDEC, both clinically and financially,” says Gastroenterologist Kenneth Schoenig, MD, the center’s medical director and administrator. “But there came a time when both the physicians and the hos-pital recognized the value of bringing in outside expertise.”

This expertise, they determined, would be in the form of a third-party manage-ment company.

“The significance of specialized third-party management is that it really af-fords the physicians to be physicians and focus on delivering care, and gives the hospital confidence that the center is being managed by experts in endos-copy center operations,” says John Hesse, MHA, vice president of busi-ness development for Advocate Bro-Menn. “I think a third party affords an objective viewpoint in making changes

to a center, including sensitive issues that sometimes a hospital and physi-cians cannot resolve because of com-peting interests.”

When Physicians Endoscopy (PE) learned that DDEC was interested in bringing on another partner, research into the history of the center revealed a facility with an impressive performance. This is what PE looks for in prospective partners, says Bob Estes, MSPT, CASC, vice president of center development and implementation for PE.

“We feel very strongly about estab-lishing partnerships that are collegial, ones that are physician- and patient-care oriented,” he says. “We also look for a business that has demonstrated some success, but could benefit from

Digestive Disease Endoscopy CenterACHIEVES GREATER SUCCESS THROUGH THREE-PARTY JOINT VENTURE

BY ROBERT KURTZ

FOR MANY YEARS, DIGESTIVE DISEASE ENDOSCOPY CENTER (DDEC) IN NORMAL, IL, THRIVED AS A JOINT VENTURE BETWEEN PHYSICIANS FROM DIGESTIVE DISEASE CONSULTANTS AND ADVOCATE BROMENN MEDICAL CENTER.

Robert Kurtz


PE’s expertise. Our partners know that we are working with them because they are already doing a terrific job of delivering care. Our interest is helping identify opportunities to improve upon an already great model. That was cer-tainly the case with DDEC.”

In 2012, PE joined the DDEC part-nership. Over the past three years, DDEC has put together a long list of accomplishments.

ACHIEVING ACCREDITATIONOne of the most significant achieve-ments was success-ful accreditation by the Accreditation Association for Am-bulatory Health Care (AAAHC). “That is something we had always want-ed to do, and through working with PE, we now had tools to do so,” Dr. Schoenig says. “We were not only suc-cessful in our passing but also with re-ceiving surveyor comments with words such as ‘model center’ and ‘strong clinical strength,’ which was certainly a credit to our strong clinical staff and clinical director.”

Estes says it came as no surprise that DDEC performed so well on its accred-itation survey.

“When we came in, there were al-ready many great things established at DDEC,” he says. “They obsess about quality of care and the experience of the patient. The physicians, medical di-rector and staff were all committed to doing what was necessary to achieve accreditation. That was everything from formalizing the structure of the governing board to reviewing, revis-ing and approving new policies and procedures in order to meet AAAHC standards. This commitment resulted

in what was ultimately a successful three-year accreditation.”

Dr. Schoenig adds, “I think one of the successes with our survey was the sur-veyor recognized that there were de-cisions we could have made that may have improved our bottom line, but could have been a diminishment in our level of care to what would be the stan-dard. But ‘the standard’ is not good enough for us. We want our center, staff and care to be above the rest.”

INVESTING IN TECHNOLOGY AND EQUIPMENTA significant trans-formation that has taken place with-in the center are capital investments, including those that have made the facil-ity paperless.

“A major change we made to flow was the implementation of a clinical dictation system and electronic health record,” Estes says. “That is significant. Not only do these systems capture all the clinical notes, but they also allow for a framework within which to meet all of the existing and upcoming require-ments from the government for clinical tracking and reporting different metrics, including those that may influence reim-bursement.”

Through these data collection efforts, DDEC also participates in the GIQuIC Registry. “Our involvement with GIQu-IC represents another process that supports our efforts to be above the standard of care with endoscopy,” Dr. Schoenig says.

This mentality also applied to the cen-ter’s purchase of hi-definition endo-scopes, new patient monitors and other medical and business equipment. “All of the technology in DDEC is now state-of-the-art,” Estes says. “It has certainly

impacted delivery of care, as well as physician and staff satisfaction.”

IMPROVING FINANCES While DDEC was investing in clini-cal enhancements, it was also finding ways to reduce costs and improve its bottom line.

“PE’s market clout and access to agreements to purchase technology and equipment is certainly beneficial,” says Hesse, who also serves as one of the two hospital representatives on DDEC’s board of managers. “PE brings in GI-specific purchasing agreements which have improved the cost structure of the center.”

Physicians Endoscopy works closely with its partners to secure better payer contracts. “We have had success ne-gotiating contracts with payers that previously either would not agree or were inflexible to discussions with the center,” Estes says. “These additional contracts allow for all in-network plans, improving access for patients. It also improves clinical flow by allowing more of the endoscopy services to come through DDEC, reducing the need for physicians to leave the center to do in-dividual cases at the hospital.”

Hesse adds, “We certainly still want to see endoscopy cases in the hospital, but we also know our joint venture of-fers a convenient, cost-effective setting for our patients, as well as being a phy-sician satisfier.”

Another improvement to service de-livery is DDEC’s approach to providing anesthesia, Estes says.

“Over the span of a couple years, we have been able to establish formal an-esthesia services at the center,” he says. “It is a much more efficient model that has allowed the center to run more ef-fectively, with the emphasis on patient care. This new arrangement has had a

Kenneth Schoenig, MD

Bob Estes


dramatic impact on operational flow and patient satisfaction. It has been an across-the-board improvement.”

BUILDING AWARENESS

With so many positive developments happening at DDEC, the partners worked together to increase aware-ness of the center. These efforts in-cluded new branding, with a new logo and a new website; marketing initia-tives, including direct mail to potential patients; and collaborating with the hospital on health fairs and community colon cancer awareness initiatives.

The results have been very encourag-ing, Dr. Schoenig says.

“Our access to care for patients has become phenomenal, both as an en-doscopy center and a partnership,” he says. “We have developed strengths that allow us to be more accessible and provide more efficient and appropriate care. We were able to recruit another physician to the practice who recog-nized the value of joining an organiza-tion focused on being a clinical leader in the industry. When patients come in and share an experience they have had at our endoscopy center in comparison to a competitor in the industry, we are hearing very positive feedback. That is something we are very proud of.”

FULL STEAM AHEADWhile the partners are pleased with what they have accomplished together

thus far, they are not sitting on their laurels. Rather, they have their sights on building on this momentum.

“We are looking for new services that could be offered out of the center, and considering other sub-specialties within gastroenterology we might be able to add to that center,” Hesse says. “PE coming in has been able to help create greater efficiencies and position the center for growth because they are able to make third-party objective decisions that are truly in the best in-terest of the center. Traditionally, hos-pital and physician conversations can be very difficult since there are often conflicting interests and responsibili-ties. But with DDEC, both groups have been willing to listen to PE and work together to make decisions that will help the center succeed.”

The success achieved to date has taken time, and the experience has brought all of the partners closer together, Estes says.

“Naturally, any change requires time, consideration, and special handling,” he says. “One thing I think we all did really well was we worked together as true partners, and were always sensi-tive to the speed with which chang-es would occur. We have gotten to

know one another and are building a partnership built on common goals.”

He continues, “My experience working with the physicians, staff and the hospi-tal is they truly prioritize the quality of life and experience for all stakeholders. This experience has really turned out to be what PE hoped for: an opportunity to be involved in a strong partnership with other organizations and individu-als who share similar priorities.”

Dr. Schoenig adds, “I think we are all very proud of the endoscopy cen-ter and its accomplishments since the partnership expanded. Work-ing with Advocate and PE has been a wonderful experience.”

It is an experience that has helped shape DDEC into a model for care delivery in today’s healthcare environment.

“As consumers become more cost-conscious and bear more of the finan-cial burden for their care, we feel very fortunate that we are well positioned with the center to offer a lower-cost, high-quality alternative for endoscopy,” Hesse says.

Robert Kurtz is the founder of Kurtz Creative, a provider of writing, editing and consulting services primarily for the healthcare industry. He is the former editor of Becker’s ASC Review and Becker’s Hospital Review. For more information, visit www.kurtzcreative.com.

John Hesse, MHA

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These are rapidly changing times in healthcare. The social, eco-nomic and political effects of

the Affordable Care Act continue to be felt nationwide. An increase in mergers and acquisitions is reshaping markets. Patients are no longer pas-sive consumers of services. There are multiple pieces of legislation under consideration that could significant-ly change the practice of medicine. And that only begins to scratch the surface of the developments reshaping healthcare.

To effectively navigate the white water of the healthcare system requires phy-sician leaders to take the steps needed to truly evaluate their organization. This process will help identify opportu-nities for growth and areas in need of improvement, both of which are neces-sary if an organization wants to achieve short- and long-term success.

UNDERSTAND YOURSELFBefore you can be-gin to consider changes to better position your orga-nization for success, it is critical to take a look at your organization and identify its strengths and weaknesses.

For example, the age of your physicians is an important characteristic to assess. Some questions you will want to answer include:

• What is the age range of your physicians?

• Do you have a balanced mix of older and younger physicians so the organization maintains strong performance as physicians leave the organization?

• Do you have recruitment efforts in place to help ensure new physicians are joining the organization at a

pace that at least matches the pace physicians are exiting?

• Do you have a succession plan in place that will maintain strong leadership for the organization as physician leaders retire?

Another important characteristic to analyze is case volume. Some questions to ask include the following:

• Is volume declining, flat or increasing?

• What efforts are underway and in place to at least maintain, if not grow, case volume?

• If case volume is declining, where is it going and how can it be recaptured or replaced?

• Is a lack of new technology and/or services limiting growth potential?

One other area to evaluate is your facility itself. Address the following questions:

BY RODGER W. BACA, CHIEF DEVELOPMENT OFFICER, PHYSICIANS ENDOSCOPY

Dominoes are Falling: Positioning Your Organization to Win in Today’s Healthcare Environment

Rodger Baca


• Has the building been maintained over the years so it still appears modern, or has time made it out-dated?

• Is the technology in use current? If not, how easily can it be upgraded (if at all) considering the design of the building?

• Does the facility offer opportunities for expansion, if desired?

• Are there features likely to turn pro-spective patients or physicians away, such as lack of an electronic health record or convenient parking?

A final area to assess that touches on all those already mentioned and some we will discuss later concerns the wishes of your physicians. Questions to address include the following:

• Do your younger physicians plan to remain with your organization for an extended period of time or are they considering other opportunities?

• Are your physicians interested in ex-panding the organization to include new specialties and/or service lines that will require bringing on new physicians from a different area of medicine?

• Do your physicians desire or have a willingness to partner with a practice, hospital and/or management and development company?

• If so, do your physicians want to main-tain majority ownership or would mi-nority ownership be acceptable? If not, what other avenues would they consider exploring to help remain competitive in a market that may be seeing increased consolidation?

When you have gathered the respons-es to these questions and others you identify as important for assembling a complete understanding of your organi-zation, you are now in a position to ex-amine the avenues for growth that exist outside of your walls.

UNDERSTAND YOUR OPPORTUNITIESIf you are interested in expanding your organization, you will need to under-stand what opportunities exist to fa-cilitate such growth or support existing growth strategies.

For example, if you determine that a high percentage of your eligible patient population is not undergoing regular colorectal cancer screenings, explore different ways to provide education on the importance of a screening and insur-ance coverage for this procedure. This can be a low-cost way to attract new patients to your organization.

If your organization is interested in ex-panding to include new service lines (such as anesthesia) or specialties (such as pain management), you will want to determine whether there are physicians available to provide these services and enough demand for them (i.e., case volume) to make the expansion and in-vestment that comes with it worthwhile.

If your organization is interested in pos-sibly partnering with another organiza-tion as a means to expand, you will need to conduct research so you can...

UNDERSTAND YOUR MARKETThere’s strength in numbers. That idiom certainly applies to healthcare, and is a motivating factor behind the increase in partnerships and consolidation oc-curring nationwide. From practices joining with other practices to create mega groups to surgery centers and hospitals forming joint ventures, or-ganizations are exploring the value of teaming up with another organization to potentially reap the benefits of each organization’s strengths.

While a partnership is not necessarily required to maintain success in today’s healthcare environment, an indepen-dent organization may find opportunities that once existed are no longer viable when partnerships form in their market. So even if a partnership isn’t necessarily on the horizon, it is still worthwhile for

physician leaders to assess their market and be open to the possibility of a stra-tegic relationship down the road.

This market assessment would identify potential partner organizations — both within the market and outside of it (such as health systems in neighboring com-munities interested in extending their reach or national management and development companies) — and the opportunities that may exist if a partner-ship with these organizations were to formalize. It may be worthwhile to have discussions with leaders from these or-ganizations about their future plans and whether opportunities exist — either formal or informal — to work together to improve the quality of care provided to the community.

Ongoing communication and collabo-ration will help keep an independent organization on the radar of potential partners. Maintaining dialogue can also help an organization perform a better self-assessment and identify areas for improvement.

BE PROACTIVEWith so much activity happening in healthcare, organizations can no lon-ger expect that they will remain viable by simply running on cruise control. But if physician leaders take the time to perform an honest evaluation of their organization, understand their place in the market and what avenues may exist to grow and begin to make changes, they will help ensure their organiza-tion is still performing well many years from now.

Rodger Baca is the chief development officer of Physicians Endoscopy. Prior to joining PE, he served as vice president of acquisitions and development for Ambulatory Surgical Centers of America. He has worked in all aspects of ASC acquisitions and Development. His career has focused on increasing profitability, creating revenue, building organizations, increasing operational efficiency and managing change in complex and high growth environments. Mr. Baca executes on creating the strategy for Physician Business Partnerships, Hospital JVs and syndication of profitable surgical centers. Rodger can be reached at [email protected].



One of the most impactful things an ambulatory surgery center (ASC) can do to con-

tinue to grow and develop the center is to bring in new physician partners through the sale of equity. In addition to the numerous business, operational and inter-personal considerations in-volved with identifying appropriate physician partners and selling shares to such partners, there are a variety of key legal considerations that any ASC should also keep in mind. This article addresses such considerations, includ-ing federal and state anti-kickback laws, state and federal securities laws and other legal considerations.

I. FOUR CORE CONCEPTSSubsequent sections of this article will address the legal rationale for these core concepts in greater detail, but ASCs can go a long way toward ensur-

ing appropriately structured sales of shares if they are mindful of the follow-ing four concepts:

1. Physician investors who refer pa-tients to the ASC should ideally not be passive indirect referral sources.

2. Physician investors should invest real capital and take real business risk on their investment.

3. Physician investors should pay fair market value for their shares.

4. The terms of investment for physi-cian investors should not be tied in any way to the volume or value of their referrals to the ASC.

II. FEDERAL AND STATE FRAUD & ABUSE CONSIDERATIONSThe Federal Anti-kickback Statute

The most relevant federal statute ap-plicable to ASCs is the Federal Anti-

Kickback Statute, 42 U.S.C. § 1320a-7b(b), which generally pro-hibits anyone from offering, paying, so-liciting, or providing anything of value (i.e., remuneration) to another person in exchange for the referral of healthcare business to another person or entity. The concept of re-muneration under the Anti-Kickback Statute has been de-fined broadly to prohibit several types of payments, discounts or transfers of anything of value in exchange for referrals.

BY AMBER MCGRAW WALSH, MCGUIREWOODS LLP & SCOTT BECKER, MCGUIREWOODS LLP

Legal Considerations When Selling Shares in an Ambulatory Surgery Center

Amber McGraw Walsh

Scott Becker

A violation of the Anti-Kickback Statute is considered a felony, and individuals or providers who violate the Statute may be subject to penalties, including fines of up to Twenty-Five Thousand Dollars ($25,000) per violation, impris-onment for up to five (5) years, or both. Additionally, the Secretary of the De-partment of Health and Human Ser-vices (DHHS) has the authority to ex-clude providers, including individuals or entities, who have committed any of the prohibited acts, from participation in the Medicare or Medicaid programs.

The ASC Ownership Safe Harbor

When selling shares to physicians in an ASC, ensuring compliance with the Anti-Kickback Statute is critical. In 1999, the Office of Inspector General (OIG) promulgated the “ASC Owner-ship Safe Harbor” regulations.

There are actually four different “ASC Ownership Safe Harbors”, based on a different ownership structure (physi-cian-hospital JV, physician only JV, mul-tispecialty JV and single specialty JV), but there are numerous common ele-ments among all four variations of the ASC Ownership Safe Harbors.

Joint ventures that are structured con-sistent with all elements of the appli-cable ASC Ownership Safe Harbor are deemed immune from prosecution un-der the Anti-Kickback Statute as to cer-tain ownership issues. Thus, ASC com-panies generally strive to ensure that their joint ventures, including the sale of shares to physicians, are structured in accordance with the ASC Ownership Safe Harbor.

The core qualitative elements of the ASC Ownership Safe Harbor are as follows:

1. The terms on which an investment interest is offered to an investor must not be related to the previous

or expected volume of referrals, services furnished, or the amount of business otherwise generated from that investor to the entity.

2. The entity or any investor (or other individual or entity acting on be-half of the entity or any investor) must not loan funds to or guar-antee a loan for an investor if the investor uses any part of such loan to obtain the investment interest.

3. The amount of payment to an in-vestor in return for the investment must be directly proportional to the amount of the capital invest-ment (including the fair market val-ue of any pre-operational services rendered) of that investor.

4. All ancillary services for federal healthcare program beneficiaries performed at the entity must be directly and integrally related to primary procedures performed at the entity, and none may be sepa-rately billed to Medicare or other federal healthcare programs.

5. The entity and any surgeon inves-tors must treat patients receiving medical benefits or assistance under any federal healthcare pro-gram in a non-discriminatory man-ner.

In addition to these requirements, there are two quantitative elements most commonly referred to as the “one-third tests”. The one-third tests are as follows:

1. For solely surgeon-owned or sin-gle-specialty ASCs, the physician investor must generate not less than one-third of his or her pro-fessional income from the per-formance of ambulatory surgical procedures listed on the Medicare ASC list in order for the ASC Own-ership structure to receive Safe Harbor protection.

2. For multi-specialty surgery centers, an investor must meet the one-third professional-income test not-ed in above (1.) and must also per-form not less than one-third of his or her ASC procedures at the ASC in which he or she invests. This is intended to ensure that certain physicians who do not perform services are not being rewarded for the efforts of other physicians or their referrals to other physi-cians who do perform procedures at the ASC. The OIG’s concern is that such parties refer to the other surgeons and are receiving the benefits of returns from the sur-gery center due to their indirect referrals.

OIG Commentary Relating to ASC Ownership

The OIG has commented negatively on situations where the value of ser-vices or items is discounted to a party who is a referral source in exchange for referrals by the party in both its com-mentary related to the ASC Safe Har-bor and the small entity investments Safe Harbor and through Special Fraud Alerts. The OIG has specifically dis-cussed its concern being that a return on investment is a disguised payment for referrals, including situations where shares in the entity to which a physician refers patients are sold to the physician for a nominal value and returns on in-vestment can be over 50% to 100%.

In addition to the ASC Ownership Safe Harbor, the OIG has stated in its com-mentary that certain “legitimate ASC arrangements may not fit precisely in the final ASC Ownership Safe Harbor. Those that do not fit may be eligible for Safe Harbor protection under the small entity investments Safe Harbor.”1

In discussing small entity investments Safe Harbor and the capital invest-


ments made by investors, the OIG has stated:

We do believe, however, that it is useful to analyze joint ventures on a case-by-case basis to determine what the real capital needs of the project are, and whether the capital that has been invested is merely a sham to pay investors for referrals.2

The OIG issued a “Special Fraud Alert” relating to health care joint ven-tures and the Anti-Kickback Statute in 1989. In the Special Fraud Alert, the OIG identified the features of what it perceived as “suspect” joint ventures under the Anti-Kickback Statute. Spe-cifically, with respect to “Financing and Profit Distribution,” the OIG identified the following as indicators of poten-tially unlawful activity:

1. The amount of capital invested by the physician may be dispropor-tionately small and the returns on investment may be disproportion-ately large when compared to a typical investment in a new busi-ness enterprise;

2. Physician investors may invest only a nominal amount, such as $500 to $1500;

3. Physician investors may be permit-ted to ‘borrow’ the amount of the ‘investment’ from the entity, and pay it back through deductions from profit distributions, thus elimi-nating even the need to contribute cash to the partnership;

4. Investors may be paid extraordi-nary returns on the investment in comparison with the risk involved, often well over 50 to 100 percent per year.3

Don’t Forget About State Law!

In addition to the Federal Anti-kick-back Statute, most states have addi-tional kickback and fee-splitting laws

that should be considered when struc-turing ASC share sales. While these statutes often closely track the federal law, some states do place more oner-ous requirements on physician inves-tors, such as requiring certain precise wording when disclosing ownership to patients who are referred to the ASC.

III. THE IMPORTANCE OF FAIR MARKET VALUEIt is important that all shares to phy-sician investors be sold at fair market value. As noted above, this require-ment comes straight out of the ASC Ownership Safe Harbor, and there has been growing attention on the critical importance of fair market value sales in recent years.

There is no single correct way that an ASC company must calculate share price in order for the sale to be deemed fair market value. Many ASC companies effectively utilize market data and certain common approaches to the calculation of share price, such as a multiple of historical EBITDA (earnings before deductions for inter-est, taxes, depreciation and amortiza-tion). However, there has been increas-ing attention on the value of greater precision in determining such share prices, and many ASC companies have moved toward utilizing third-party val-uation companies to make such deter-minations.

In 2001, several complaints were filed against Columbia HCA by the United States joining parties in bringing qui tam actions (commonly referred to as “whistleblower suits”). These com-plaints related in part to the sale of interests to physicians in hospitals and included allegations of sham invest-ments. One example of alleged ille-gal action claimed by the government and relator in the suit was that despite advice of counsel that “if partnership

interests were acquired at below fair market value or for nominal consid-eration (e.g., nonrecourse notes), the rate of return on investment could appear unreasonably high, thereby raising the implication that the return on investment is, in part, payment for patient admissions or referrals to the Hospitals,“ certain HCA executives “offered and provided investments to physicians at minimal or no out of pocket cost to the physicians for the express purpose of inducing referrals.”

Even more recently, in September 2014 Meridian Surgical Partners, LLC settled a qui tam lawsuit (i.e. a “whistle blower suit”) alleging, among other things, that Meridian sold shares to physician investors for below fair market value in its Treasure Coast Surgery Center joint venture. Although Meridian denied such claims, and although the settle-ment with the government of $3.32 million was a small fraction of the $100 million originally demanded, the atten-tion that the government and judge in such lawsuit gave to the determination of fair market value was illuminating. Both the government prosecutors and the judge stressed how valuable third party valuation would have been to substantiate Meridian’s claim that the shares were really fair market value.

IV. SECURITIES LAWS CONSIDER-ATIONSThe sale of shares to physicians in an ASC should also be structured consis-tent with federal and state securities laws as the shares will, in many cases and depending on numerous fac-tors, be considered the sale of secu-rities that would otherwise trigger an obligation to register such securities sales with federal and state securities commissions unless certain federal and state exemptions to such registration requirements are met.



ASC companies should examine fed-eral and state securities laws with the goal of meeting such exemptions from registration, which exemptions are typically available for small offerings to a limited group of potential investors meeting certain characteristics. One of the most critical elements of meet-ing most available exemptions is the provision of full and proper disclosures to the potential investors of the salient details of investment, as well as the risks of investment.

V. COMMON PITFALLS IN THE SALE OF SHARESThe following list of actions are com-mon pitfalls that some ASC compa-nies can face when selling shares to physicians. Different ASC companies utilize different strategies for the sale of shares effectively, and there is cer-tainly no one right way to structure the sale of shares; however, these actions should generally be avoided:

1. Do not offer less or more shares or a higher or lower price based on the number, volume or value of re-ferrals a physician can generate.

2. Do not reallocate shares based on the volume or value of referrals.

3. Do not focus on individual distri-butions being tied to the number of patient referrals. Never make any indications that could lead a potential investor to believe that referrals or performance will deter-mine an individual’s “piece of the pie.” Focus on overall distributions and profits.

4. Physicians should not be allowed to invest based upon the fact that they can generate referrals for an-other physician who may use the center.

5. Avoid providing physicians with estimates as to the amount of rev-enue that will be generated from

their referrals or from another phy-sician’s referrals.

6. Do not offer remuneration or special treatment under various disguises, such as directorship contracts or discounted lease arrangements, in order to induce investors.

7. Do not pressure physician investors to shift their referral patterns.

8. Do not make indications to inves-tors that low-referring physicians will be pressured to withdraw.

9. And of course, shares should be sold at fair market value!

VI. ADDITIONAL NOTES AND CONCLUSIONSFinally, it should be noted that this ar-ticle assumes a joint venture structure whereby the investing physicians are all surgeons and are investing as indi-viduals directly in the JV entity. As the healthcare industry continues to see physician practices consolidate into larger groups or become acquired by hospitals, and as physicians gravitate toward IPAs and similar risk-bearing organizations, such larger groups and risk-bearing organizations are begin-ning to look at investment in ASCs in unique and effective ways. Such invest-ment typically falls outside of the ASC Ownership Safe Harbor, meaning that the investment is not immune from prosecution under the Anti-kickback Statute, but that does not necessarily mean that such investment violates the Anti-kickback Statute.

ASCs considering such novel ap-proaches to ownership would be wise to consider the four core fundamental concepts underlying the Anti-kickback Statute (noted in Section I) no matter which entity or individual is investing to enhance the likelihood of the owner-ship structure being deemed compli-ant with federal and state law.

1 64 Fed. Reg. 63536.2 56 Fed. Reg. 35970.3 The 1989 Special Fraud Alert was reprinted in the Fed-eral Register in 1994. See 59 FR 65372 (December 19, 1994).

Amber McGraw Walsh is a Partner at McGuire Woods Law Firm in Chicago, IL. Named to “Illinois Rising Stars,” Healthcare, Super Lawyers, by Thomson Reuters, Amber focuses on corporate healthcare transactional work and regulatory matters. Her experience includes representation of various types of healthcare providers including hospitals, health systems, dialysis facilities, multi- and single-specialty medical practices, specialty hospitals, ambulatory surgery centers, and a variety of healthcare industry entrepreneurs, in sales and acquisitions, joint ventures, general corporate matters, contracting, securities, and regulatory matters. For more information, Amber may be reached at [email protected].

Scott Becker is a Partner at McGuire Woods Law Firm in Chicago, IL and has been on the Board of Partners since 2008. He is the chairman of the firm’s healthcare department and practices exclusively in the healthcare regulatory and transactional area. Scott provides counsel on healthcare transactional and regulatory matters to hospitals, health systems, hospital chains, ambulatory surgery centers, ambulatory surgery center chains, private equity funds and lenders, and healthcare industry entrepreneurs. For more information, Scott may be reached at [email protected].

www.endocenters.com




Employees are a company’s great-est asset. Every good CEO says this and any business journal you

read should tell you this. It is also very true in service organizations and partic-ularly in healthcare settings. Yet, if you ask any small business owner what is their understanding of human resources (HR), they may answer that it’s “hiring, payroll and benefits.” That is correct, but in the day of navigating the Afford-able Care Act (ACA), the web of em-ployment laws and a concept known as employee engagement, there is much, much more to HR.

Generally, companies with more than 100 employees have an in-house HR pro-fessional. However, often times in small organizations, one particular individual is responsible for HR tasks in addition to their regular job. In small organizations people wear many hats, and HR ends up being performed by an office man-ager or administrative assistant. There are, however, both practical and legal reasons why HR support and expertise is needed by small organizations.

PRACTICALHow do you attract and retain the right employees for your organization? It’s not as simple as interviewing and pick-ing the person with the friendliest per-sonality or who is dressed best for the interview. The hiring process has more to it than a “gut feeling”. Although your instincts should help guide your deci-sion to move forward, there are indus-try-wide standards of interviewing and

selecting employees who are a match for the roles at your company.

Additionally, there are employment laws that surround inter-viewing and selec-tion that you may not be aware of. You may think asking if a candidate is mar-ried, how many kids they have, or what their hobbies are outside of work will help you hire a good fit within your orga-nization, but asking those questions will put you at risk of a discrimination claim. Having an HR resource to guide you on the best interviewing and screening techniques would help find the right person, without the legal risk.

Once the new hire gets in the door, you now need to provide them with training, development and a company culture that keeps them happy and productive. That sounds pretty easy, but it is not that simple. Let’s face it, employees work in order to earn a living and to get intel-lectual and social stimulation. They want to enjoy what they do, be challenged, valued, appreciated, treated fairly and have fun while they’re at it. Engagement is a big term these days, but what does it actually mean?

The definition of an engaged employee is “one who is fully absorbed by and enthusiastic about their work and takes positive action to further the organiza-tion’s reputation and interests”. Why is this so important? Simply put, happy

employees are the best employees. They’re the ones who are going to go the extra mile. When given the choice, they seek more work when their work is finished versus sitting back and relax-ing on your dime. Engagement is also an incredibly important part of em-ployee retention.

There are many aspects of engage-ment, and the definition may be dif-ferent among different generations of employees. This is where an HR resource may be helpful in reviewing your efforts on building a culture of en-gagement that keeps employees ex-cited to go to work every day. A good HR resource can also help you realize how important it is to have regular staff meetings and updates. It could be as easy as making sure you’re communi-cating the latest news about your busi-ness to employees so they understand the direction in which the business is going or company challenges.

When it comes to employee salary and benefits, your total rewards package needs to be competitive in your local market. Granted, small businesses don’t always have the financial resources to offer the same type of benefits pack-age or pay rates as larger employers do, but you can offer a comprehensive package that’s competitive in your lo-cal area to attract and retain staff. To do those things, your HR resource can help quite a bit. They may refer you to a lo-cal benefits broker or consultant who can help you build your benefits pack-age. If you are unable to set your salary structure as high as the local market, you may be able to provide benefits that are attractive. This could include certain cre-ative paid time off programs or flexible work arrangements to help employees achieve a work/life balance.

LEGALOne of the reasons you run a small busi-ness is because you have something special to offer. You’re an entrepreneur who is very good at what you do, wheth-

DEFINING HR:Why Small Businesses Need HR Support

BY TRICIA PICKFORD, VICE PRESIDENT HUMAN RESOURCES, PHYSICIANS ENDOSCOPY

Tricia Pickford


er you’re a physician or a business per-son. That does not mean you’re good at everything, including knowing and un-derstanding every employment law that may help you avoid legal trouble.

When I started working in human re-sources 15 years ago, things were very different. HR representatives could ac-tually help employees review their per-sonal medical claims and make calls to health insurers on their behalf. The Americans with Disability Act (ADA) was more specific and wasn’t as expan-sive as the new ADA Amendments Act (ADAAA), which covers almost every sin-gle health issue. In just the last couple of years, several states have implemented significant changes, including legaliza-tion of same sex marriage, and health-care reform has taken over the world of employee benefits. Over time the legal landscape of HR will continue to change, and it will require employers of all sizes to become more aware of what’s happening in employment law.

Just when you think it’s challenging enough to comply with federal laws as employers, the states and localities are also becoming more restrictive from an employer perspective, including which laws apply to your business based on its size. This is not something you want to navigate through, nor do you want to call your employment attorney for guid-ance every time you have a question on whether you’re doing the right thing; that can get very expensive. I’d recom-mend only using your employment at-torney for significant employee issues.

There are also some practices in HR that help to avoid liability. This list can be endless, but an example could be how diligent you are on your I-9 documenta-tion for new hires. The I-9 is a form em-ployers are required to complete within three days of a new hire’s employment. If not completed, you could be penal-ized (if you’re audited) by the ICE (Immi-gration and Customs Enforcement). This is one basic example; however, there are many other regulations to follow under

the Department of Labor (DOL) or Equal Employment Opportunity Commission (EEOC). These laws concern various areas such as the Fair Labor Standards Act (FLSA) which covers wage and hour, discrimination, anti-harassment and re-taliation (Title VII of the Civil Rights Act of 1964), the Americans with Disabilities Act (ADA), the Age Discrimination in Employment Act (ADEA) and other sig-nificant laws.

At Physicians Endoscopy’s partnered surgery centers, the most prevalent area of HR administration is leave administra-tion. Employees get sick, have sched-uled surgeries, get injured, or go out on maternity leave. There are many possi-ble legal implications with leaves of ab-sence, making them a huge challenge to manage. As a small employer, you likely won’t need to follow the Family Medical Leave Act (FMLA). However, you don’t always have the flexibility on how much leave time you can offer employees, and you will need to be cautious of the Americans with Disabilities Act – ensur-ing compliance means you have to me-thodically manage these situations.

It is virtually impossible for small busi-ness owners to be aware of every law and HR “best practice”. Even HR pro-fessionals sometimes need to refer to outside sources, such as online HR ency-clopedia-type resources, to help guide their decisions. At minimum, if you run or manage a small business, you should subscribe to one of these services that can allow you to search for federal and state specifics. If you’re located in a city, make sure you review the city labor laws or have subscribed to local e-newslet-ters and updates. Your payroll provider may also have resources on their web-site that can help navigate some rules regarding wage, hour and local laws.

According to the EEOC, “figuring out whether or not an employer is covered can be complicated.” If you are not sure whether coverage exists, you can con-tact one of their local field offices for more information. Further, the EEOC

says, “it is also important to keep in mind that, if an employer is not covered by the laws we enforce, the employer still may be covered by a state or local anti-discrimination law. If it is, we can re-fer you to the state or local agency that enforces that law.”

How do you best manage all of this while keeping your greatest asset happy? Common sense and a fair mind certain-ly help; however, you should consider looking for outside HR assistance. There are several options, such as looking for a local HR partner or consultant who of-fers core HR support in many areas, or partner with a payroll provider such as ADP or Paychex who offer HR solutions in the same fashion. These types of ser-vices are typically provided in three dif-ferent ways where you pay: 1) a retainer including a set monthly or annual fee, 2) on a per-project basis, or 3) on a per-hour basis. You can discuss the level of HR support you want and go from there.

HR professionals are extremely valuable and a huge asset to all size organiza-tions. Their extensive training, knowl-edge and expertise provide employ-ers with sound advice to assist in both practical and legal situations. With your employees’ best interests at heart, the value of sound human resources sup-port will go a long way.

Resources:http://en.wikipedia.org/wiki/Employee_engagementhttp://www.eeoc.gov/laws/statutes/index.cfmhttp://www.eeoc.gov/employers/coverage_private.cfm

Tricia Pickford, vice president human resources at Physicians Endoscopy, has over 15 years progressive HR experience including talent acquisition and full-cycle recruitment; compensation and payroll management; performance management and employee relations; employee benefits management, design, implementation and administration; policies and procedures; employee develop-ment; and compliance. Ms. Pickford earned her BA in Labor and Industrial Relations from Penn State University and her SPHR (Senior Professional in Human Resources) certifi-cation through the Society for Human Re-source Management. Tricia can be reached at [email protected].


http://en.wikipedia.org/wiki/Employee_engagement

http://www.eeoc.gov/laws/statues/index.cfm

http://www.eeoc.gov/employers/coverage_private.cfm


As you know, the government has been aggressively pursuing enforcement ac-tions against health care providers, including providers in the ASC indus-try. In 2012, the Office of the Inspector General (OIG) issued an unfavorable advisory opinion regarding two types of ASC anesthesia arrangements. The two problem arrangements in the OIG opin-ion involved: 1) an anesthesia provider serving as an ASC’s exclusive anesthesia provider and paying the ASC for certain management services of the anesthesia practice; and 2) physician owners in an ASC forming a new anesthesia compa-ny that then contracted with their ASC as the exclusive provider of anesthesia services. The OIG responded by stating that both of the arrangements would likely have anti-kickback risks. As a re-sult, many of these types of ASC anes-thesia arrangements are being replaced with arrangements that carried less reg-ulatory risk. Some of the alternative ASC anesthesia models are summarized in this article. Obviously, the models must be analyzed in light of specific facts and

circumstances and carry varying degrees of risk that have to be considered. Further, state laws may have an impact on the vi-ability of the ASC an-esthesia model. TRADITIONAL MODELThe Traditional Model is an arrangement where the anesthesia practice enters into an exclusive contract with the ASC

to provide anesthesia. Here, the anes-thesia practice would bill and collect for all anesthesia services and retain all revenue from collection. The surgeon owners of the ASC do not profit from anesthesia. PROVIDER EMPLOYMENT MODELIn the Provider Employment Model, a group practice which is owned by sur-geons that also have a common owner-ship interest in the ASC: 1) enters into an exclusive contract with the ASC to provide anesthesia; 2) directly employs an anesthesiologist to provide anes-thesia at the ASC; 3) group practice bills and collects for anesthesia; and 4) after paying the employment compen-sation for the anesthesiologist, retains the profits. This arrangement should be structured to meet the group prac-tice investment safe harbor in order to mitigate the risk of a violation of the anti-kickback law. PROVIDER LEASING MODELThe Provider Leasing Model is very similar to the Provider Employment Model above. In the Provider Leas-ing Model, an anesthesia practice leases anesthesia providers to the group practice. The group practice bills and collects for the anesthesia services, and the group practice pays the anesthesia practice a flat fee for the anesthesia providers. Again, the risk with this model should be mitigat-

Is It Possible to Profit from Anesthesia: Alternative ASC Anesthesia Models

BY JAMES A. SALING

James A. Saling

Surgeon Surgeon Surgeon

ASC

AnesthesiaProvider

Payors

Anesthesia Services

Bills

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ProfessionalServices Agreement

AnesthesiaPractice

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Traditional Model


ed by structuring it to ensure compliance with the group practice investment safe harbor.

ASC PROVIDER EMPLOYMENT MODEL In the ASC Provider Employment Model, the anesthesia pro-vider is directly em-ployed by the ASC or its wholly-owned subsidiary. The ASC would bill and collect for anesthesia servic-es, pay the anesthesia provider’s employ-ment compensation, then retain profits as-sociated with the an-esthesia services. This

model is not a safe harbored arrangement; however, there are arguments that it meets the safe harbor at least for direct employment. As you can see, it is still possible to profit from anes-thesia in an ASC; however, the arrangement should be structured in a way that either fits within an ASC safe harbor or is thoroughly vetted by healthcare regulatory counsel, especially as it relates to state laws and regulations.

James A. Saling is a partner in the law firm of McDermott Will & Emery LLP. James concentrates his practice on health care mergers and acquisitions and regulatory matters. He has coun-seled clients on a wide range of matters, including structuring financial arrangements and transactions to comply with the Anti-Kickback Statute and the Stark Law; Medicare certifica-tion and reimbursement; state licensure issues affecting health care providers; corporate practice of medicine and dentistry; joint ventures between health care providers; tax exemption; development of integrated delivery systems; and structuring incentive compensation and risk sharing arrangements. James can be reached at [email protected].

SurgeonA

SurgeonB

SurgeonC

ASC

SurgeonA

SurgeonB

SurgeonC

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GroupPractice

ProfessionalServices

Agreement

Bills

$$$

Provider Employment Model

AnesthesiaProviderPayors

Bills

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SurgeonA

SurgeonB

SurgeonC

ASC

ASC Provider Employment Model

SurgeonA

SurgeonB

SurgeonC

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SurgeonB

SurgeonC

AnesthesiaProvider

AnesthesiaPractice

Payors

GroupPractice

ProfessionalServices

Agreement

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Provider Leasing Model

[email protected]

Front and Center


Health Fair – Advanced Endoscopy Center (AEC) brought the Rollin Colon to the Montefiore Health Fair held outside of Mon-tefiore Medical Center. AEC, Montefiore and the Colon Cancer Challenge Foundation (CCCF) partnered to promote colon cancer awareness.

Lunch and Learn – Ambulatory Center for Endoscopy (ACE) held their first “Lunch and Learn” to kick off Colon Cancer Aware-ness month. ACE, in conjunction with Pali-sades Medical Center, put up posters and distributed materials around the Palisades Medical Center hospital in order to drive home to all visitors the importance and value of screening.

Media – Berks Center for Diges-tive Health (BCDH) physicians discussed

colon cancer prevention on various television and radio stations across the Berks County region.

Open House – Burlington County Endoscopy Center (BCEC) held a center open house on March 16th where several of the doctors and staff provided their guests a tour of the facility. Flyers were distribut-ed to the local community and announce-ments were placed on event calendars and social media pages to promote the event. BCEC also took part in the annual Get Your Rear in Gear run/walk sponsored by the Colon Cancer Coalition in Philadelphia on March 22nd.

CC Summit – Carnegie Hill Endos-copy (CHE) participated in a variety of colon cancer awareness events including the 12th

Annual Colon Cancer Challenge Founda-tion Walk at Citi Field, AliveAndKickn’s 2015 Blue Genes Bash, and CHE’s first ever Early Age Onset Colorectal Cancer Summit (EAO-CRC 2015). The summit provided an opportunity to hear leading clinicians and scientists on the epidemiology, pathogen-esis, genomics and lifestyle challenges of EAO-CRC.

Colon Kiosk – Digestive Disease Endoscopy Center (DDEC) had their colon kiosk on display at Advocate Bro-Menn Medical Center with colon cancer screening stats and facts on the importance of screening. Staff wore blue wrist bands, shirts, pins and buttons, and distributed colon cancer screening facts and companion cards throughout the month.

Saturday Screening Day – Endos-copy Center of Bainbridge (ECB) and its sister center, University Suburban Endos-copy Center (USEC), celebrated Saturday Screening Day on March 21st by offering patients a chance to schedule screening appointments on that Saturday—capturing patients that may have not otherwise been able to visit during their usual Monday through Friday hours.

CC Cook-Off – Endoscopy Center of Niagara (ECNI) kicked off Colon Cancer Awareness Month by participating in the Na-tional Dress in Blue Day on March 6th and gave hospice bouquets to colonoscopy pa-tients during the first week in March. Other events included handing out ECNI mugs to all colonoscopy patients and holding a Co-lon Cancer Cook-off where each entry need-ed to have a blue component.

Colon Cancer Awareness Month HappeningsPhysicians Endoscopy extends its appreciation to all of our affiliated centers who took part in a variety of Colon Cancer Awareness activities throughout the month of March.

Colorectal Cancer is the third most commonly diagnosed cancer and is the second leading cause of cancer death. The lifetime risk of being diagnosed with colorectal cancer is about one in 19. When caught early, the 5-year sur-vival rate is 90% at Stage I and Stage II; the 5-year survival rate for patients diagnosed at Stage III is 70% and Stage IV is 12%1.

The importance of spreading awareness is one that should be recognized.*


Front and Center

Raffle Baskets – Endoscopy Center of Robinwood (ECR) helped raise funds to support colon cancer patients during their treatment at the John Marsh Cancer Treatment Center by selling tickets for blue-themed raffle baskets, as well as participat-ing in a fundraiser in conjunction with Bob Evans in Hagerstown, MD.

80% by 2018 Pledge – Endoscopy Center of Western New York (ECWNY) posted educational colon cancer aware-ness flyers at local grocery stores, gyms, community bulletin boards, etc., as well as distributed hospice flower bouquets to patients having colonoscopies during the first week of March. This year, ECWNY com-mitted to be a part of the “80% by 2018” colorectal cancer screening goal by signing the “80% by 2018” pledge—an initiative begun by the National Colorectal Cancer Roundtable and supported by the Ameri-can Cancer Society.

NY C5 – East Side Endoscopy New York (ESENY) distributed colon cancer aware-ness brochures to physicians in the commu-nity, as well as participated in the 12th An-nual Colon Cancer Challenge Foundation Walk at Citi Field. ESENY was a part of the New York Citywide Colon Cancer Control Coalition (C5) team to help with their “Your Turn” campaign. C5 has been an essential partner in NYC’s efforts to control colon cancer.

Chamber of Commerce – Hud-son Valley Center for Digestive Health (HVCDH) hosted a Colon Cancer Lecture for the Hudson Valley Gateway Chamber of Commerce where Dr. David Lin gave a lec-ture on Colon Cancer Awareness. HVCDH also participated in and presented at an education booth to help promote aware-ness at the 2015 Colorectal Cancer Aware-ness Expo—part of a joint effort with New York Presbyterian Hospital and Hudson Val-ley Hospital Center, among other vendors, highlighting “Colon Cancer Awareness” for the month of March.

Blue Cook Off – Island Digestive Health Center (IDHC) kicked off Colon Can-cer Awareness month by celebrating Dress in Blue day on March 6th and having a “Blue Cook Off” on the 16th. All patients and visi-tors were greeted with a blue decorated en-tryway during the month of March.

Giveaways – Kalamazoo Endoscopy Center (KEC) distributed blue reusable shopping bags to all patients during the month of March.

Promotions – Laredo Digestive Health Center (LDHC) delivered colon cancer awareness promotions and materials to re-ferring physicians.

Health Fair – Long Island Center for Digestive Health (LICDH) exhibited at the Health and Wellness Fair at the Freeport Recreation Center on March 14th, as well as sponsored the 12th Annual Colon Cancer Challenge Foundation Walk at Citi Field. LICDH distributed blue star stickers and co-lon cancer awareness t-shirts to all patients screened in March. Post cards, companion screening letters, and additional educational materials were distributed and available in the lobby.

Events – Michigan Endoscopy Center (MEC) held its annual “Striking Out Colon Cancer” event on Friday, March 6th – rais-ing money to donate to the Colon Cancer Alliance—helping fund cutting-edge re-search and providing the highest quality patient support services to thousands bat-tling colon cancer.

Run/Walk – Physicians Endo- scopy (PE) participated in the Nation-al Dress in Blue Day on Friday, March 6th to promote the awareness of colon cancer and the importance of screening colonoscopy. PE also took part in the annual Get Your Rear in Gear run/walk sponsored by the Co-lon Cancer Coalition in Philadelphia on March 22nd.

*This is a partial listing of colon cancer awareness initia-tives done by PE-partnered centers

Reference:1 http://www.coloncancercoalition.org/get-educated/what-you-need-to-know/colon-cancer-facts/

http://www.coloncancercoalition.org/get-educated/what-you-need-to-know/colon-cancer-facts/

In order to build an effective marketing strategy to achieve such goals, your approach should be methodical and varied. Your approach requires devel-opment and planning, strategy, and execution. Each of these stages rely on one another, and skipping or focus-ing minimal efforts on one of them will thwart the goal of your initial efforts.

STAGE 1: DEVELOPMENT AND PLANNINGKnowing who your ideal target pa-tient is, is the first step in creating a marketing plan for your practice. You must first understand the makeup of the surrounding community—the de-mographics—including gender, race, age, household income, etc. Are there

specific subsets of the population that make up your patient base that you should be catering to? Is there a more ideal patient you would like to reach that you don’t have already? Are there any factors that limit patients commut-ing to your practice? Do most patients drive to their appointment? Is public transportation available? Determine who your patients are, why they come to you, and how to attract others.

Being aware of your practice’s strengths, weaknesses, opportunities, and, most importantly, your competition, will allow you to formulate a specific message to use when promoting your practice. What makes your practice unique? In the past, what tactics have worked and what have not? What are your successes and failures? Taking a look at your practice’s previous marketing initiative outcomes

Growing Your Investment:THE STAGES OF MARKETING A MEDICAL PRACTICE

BY LORI TRZCINSKI, MARKETING COORDINATOR, PHYSICIANS ENDOSCOPY

Lori Trzcinski

ESTABLISHING A STRONG PATIENT BASE DOESN’T HAPPEN OVERNIGHT. IT TAKES TIME TO DIFFERENTIATE YOUR PRACTICE FROM THE REST, DEDICATION TO SEE PROMOTIONAL GOALS THROUGH TO COMPLETION, AND A DESIRE TO EXAMINE THE RESULTS—WHAT WENT RIGHT AND WHAT COULD BE IMPROVED UPON. IT IS NO LONGER ENOUGH TO SIMPLY HAVE YOUR PRACTICE LISTED IN THE PHONEBOOK, TO RELY ON WORD OF MOUTH, OR TO HAVE A HOSPITAL AFFILIATION; PHYSICIANS MUST NOW ACTIVELY SEEK OUT NEW PATIENTS AND REFERRAL SOURCES AS A MEANS OF GROWTH.


Marketing BuzzFront and Center

Marketing Buzz


will only help you to formulate a more targeted strategy. Recognize what deficiencies there are and improve upon them. What has worked for your competition? What your competition does to promote themselves may not always be the best solution to fit your needs, but sometimes just knowing what tactics are being used is of much greater value.

Two elements crucial to the planning stage that will have the greatest effect on the reach and influence of a market-ing campaign are budgeting and sup-port. Knowing how much of a budget you have to work with and what you are comfortable spending from that budget will greatly influence the ap-proach you take on where to best al-locate those funds. The person(s) re-sponsible for creating and sending out the marketing materials, following up with patients, and tracking the sourc-es of new patient referrals will be the core support of a practice’s marketing efforts. When planning, be sure to consider your current staff’s availabil-ity and workload. A larger, more ro-bust plan will call for greater time and effort—an effort that may sometimes require additional support staff or outside assistance.

STAGE 2: STRATEGYSetting short-term and long-term goals for marketing your practice will allow you to establish a more concrete strategy. Whether it’s attracting a new type of patient base or integrating a new service line into your practice to give you that competitive edge, your marketing initiatives should in-volve a healthy mix of advertising and promotion, networking, and commu-nity outreach.

If you have not done so already, establishing and maintaining your practice’s identity, or brand, is essential in order to keep your advertising message consistent. Without it, those messages will be lost, and it will be a challenge to set yourself apart from the rest. That messaging includes the look and feel of brand items such as your logo, website, and your print and promotional materials.

The key to advertising success is being repetitively seen and heard until your audience develops a familiarity with your brand. There will always be specific location-based marketing items that will work for you simply by knowing your audience and being a part of the community. Are there certain media outlets that are more prevalent at reaching your target market that you should be in? Are those targeted solutions paying for an ad in the newspaper or being featured on a news segment?

There are other items, however, that have become a standard in marketing and should be integrated into your strategy if they have not been already. Some are more of a necessary staple in today’s digital marketing, such as having a website and a Facebook page, while others are more specific to making the location of your practice more readily available to the public—such as verifying your practice listings on the major search engines (Google, Bing, Yahoo!).

In addition to advertising and promo-tion, another key piece in your practice marketing strategy should be network-ing. In order to have a substantial re-ferral base of physicians, a networking relationship must exist. The relation-

ship should foster a mutual benefit and be something of value and meaning to both parties. The key to networking is time and effort. Connections can be made through a variety of ways includ-ing industry conference receptions and events, and physician-specific social media networking sites, but the most important part is the nurturing of that professional relationship, which will al-low for a more solid referral base.

The final piece of your strategy should be community outreach. Your most influential marketing tool is your pa-tients themselves, and they must see that their well-being is your number one priority. With the focus of health-care changing from quantity to qual-ity of care, this is of great importance. Have an open line of communication with patients before, during, and after their visit. After appointments, follow up to see how they are doing and ask if they have any questions or concerns. Send them thank you letters after an appointment or birthday cards during their birthday month to show them that you care. Send out a practice publica-tion or newsletter with useful health tips and information to guide them outside of office visits. Hold an open house where potential patients can tour your center and recruit new ones by offering free screenings. Be pres-ent at community events, get involved in awareness groups, and have a table at a local health fair to keep your prac-tice’s name (and the physicians associ-ated with it) in the public eye.

STAGE 3: EXECUTIONNow that you have an action plan and know what end results you would like to achieve through marketing your practice, you should prioritize your

Marketing Buzz


goals and assign the tasks of those goals to specific individuals to get the most out of your plan. You should stra-tegically plan for each of the items—taking advantage of any cross-channel, cross-promotional opportunities that may apply in order to unify your brand-ing efforts. For advertising and promo-tion, you could set a goal, for example, of sending out two practice-related items a month. Those items could be press releases, articles, postcards to the community, recording a radio spot or filming a commercial spot to air on stations in the community. For net-working, you could set a goal of meet-ing one to two new physicians every four weeks with the intention of setting up follow-up networking opportuni-ties with them—whether it be meeting

for lunch or dinner, or even providing them a personal tour of your practice and a chance to meet the staff. For community outreach, you have a vast number of opportunities. You could set a goal of performing a number of charity cases per quarter, or a goal of participating in at least six community events throughout the year.

NEXT STEPSThe key to successfully executing your medical practice marketing plan is the timeline you set up to accomplish it in. What is most important to you now? What goals should have more priority over others? Which will be more impactful? Who will be available to help you carry out the plan and when? Assigning the workload and

responsibilities to specific staff, including yourself, will allow for a successful transition into the marketing timeline by all parties involved.

Though growing your practice through marketing is a methodical process, with a well-thought out plan and a timeline to follow, sustainable growth of your practice is within reach.

Lori Trzcinski is the marketing coordinator at Physicians Endoscopy and the manag-ing editor of EndoEconomics. Ms. Trzcinski leads the corporate and center marketing initiatives of PE and its affiliated centers. Ms. Trzcinski earned a B.A. in Business & Economics and Media & Communi-cations from Ursinus College. For more information, she can be reached at [email protected].

Marketing Buzz


Business Briefs

Top Three Tech Tools Your Practice Should Be Using

2. Video conferencing. Video conferencing can be an incredibly effective tool in the employment of remote telemedicine. First, physicians and patients can reduce the costs associated with regular office visits. Second, video conferencing can have uses beyond the private practice by making physician-to-physician connections for consultations and referrals easier and faster. Video conferencing solutions can surely influence efficiency for healthcare providers by expanding their reach, providing quality care on-demand, and reducing costs.

3. EHR Platforms. To meet requirements in the second stage of the government’s EHR incentive program, at least 5 percent of a practice’s patients view, transmit, or download their personal health information. By implementing a certified EHR that has user-engaging patient portals, practices can also improve patient care and patient loyalty. Additionally, an EHR platform designed with a user-engaging patient portal, may offer a new experience for patients, especially if they can access information through properly secured mobile apps.

We have entered an era in which patients can easily access their medical records, and pay their bills, request appointments, research health topics, review personal health information, complete medical forms, and update their profiles and contact information online. That is, as long as practices embrace the technology that enables patients to do so.

Physician practices should be ready for the new age of patient communication because the speed at which patients desire and demand information has shifted from soon, to instantaneous.

Physician-patient communication has never been more significant and critical for successful practice operations. Here’s why.

Patients today are well connected socially and electronically and have very high expectations — actually demands — for relevant, timely, and action-oriented responses from physicians and practices. On the other side, physicians have more reasons to initiate communication with patients to be sure they are responsive, adherent, and moving their own healthcare needs along as directed.

Below are the three ways physicians should be using technology to better engage and communicate with their patients:

1. Patient Portals. Physicians often resist changes to their work processes and fear patients will be confused by the data pushed to them through a portal. However, looking at the benefits the patient portal offers, more practices are using patient portals as a resource. Through the portal, patients can view valuable and updated health information online and ask questions for immediate or later response. But also these portals can generate an increase in patient loyalty because practices are providing more context and information beyond what is said during the appointment. When the portal demonstrates an “above and beyond” attitude by your practice, patients will respond favorably. Practices can utilize patient portals the most by including key features of open access scheduling, patient education, two-way messaging, and patient reported outcomes.

BY DIVAN DAVE

Reprint from: http://www.physicianspractice.com/blog/three-tech-tools-your-practice-should-be-using-and-why


http://www.physicianspractice.com/blog/three-tech-tools-your-practice-should-be-using-and-why

Physicians Endoscopy a “Great Place to Work”

Business Briefs

Each year, Becker’s Hospital Review hand selects organizations to fea-ture on its “150 Great Places to Work in Healthcare” list. Nominations are based on workforce-centric awards received, benefits offerings, wellness initiatives, efforts to improve professional development, diversity and inclu-sion, work-life balance and a sense of com-munity and unity among employees. This list features both healthcare providers as well as other genres of healthcare-related companies.

For 2015, Physicians Endoscopy, the only GI-specific, single-specialty ASC development and management company in the industry, was chosen as one of the “150 Great Places

to Work in Healthcare”. A tireless physician partner, Physicians Endoscopy is active with community causes—raising awareness for colon cancer with events such as Get Your Rear in Gear and Dress in Blue Day.

Anytime a company is recognized for its achievements, especially growth and employee value, it gives an unprecedented boost to the company’s image and overall morale. Every company has something that its employees get excited about. What is your company’s?

Workplace culture is important and can be quite invaluable.


Content sources:http://www.beckershospitalreview.com/lists/150-great-places-to-work-in-healthcare-2015.html

Congratulations Tricia PickfordPhysicians Endoscopy would like to congratulate Tricia Pickford, VP, Human Resources on achieving her SHRM-SCP* Certification. The SHRM-SCP Certification demonstrates that Tricia is a technical HR expert and has mastered the application of HR technical and behav-ioral competencies, through practice and

experience, to drive business results. The certification test is typically taken by HR professionals who develop strate-gies, lead the HR function, foster influence in the community, analyze performance metrics, and align HR strategies to organizational goals. Ms. Pickford has previously also earned her SPHR (Senior Professional in Human Resources) certification through the Society for Human Resource Management.

*Society for Human Resource Management – Senior Certified Professional

Tricia Pickford

http://www.beckershospitalreview.com/lists/150-great-places-to-work-in-healthcare-2015.html


Current GI Opportunities

For more information, contact:Annie Sariego, CASC, VP, Operations(215) 589-9008 • [email protected]

North Bergen, NJAn outstanding opportunity for a gastroenterologist!

For more information, contact:Annie Sariego, CASC, VP, Operations(215) 589-9008 • [email protected]

Cortlandt Manor, NYAn opportunity in Northern Westchester with a two-physician practice.

The physicians of Gastroenterology Consultants of Laredo, a private gastroenterology group, are seeking a gastroenterologist to expand the practice. This candidate will have ownership opportunity in the affiliated endoscopic ambulatory surgery center.

This two-room facility is located in Laredo, Texas in the Northtown Professional Plaza on McPherson Avenue.

• Physician-owned and controlled center• State-of-the-art endoscopic equipment• Medicare licensed and AAAHC accredited• Anesthesia services for patient comfort• Physician efficiency and optimal patient quality of care• Nursing staff has extensive experience in GI endoscopy• An outstanding benefits package is offered• Professionally operated and managed• Group participates in research• High population to GI Doctor ratio 60,000:1• 2 Nurse Practitioners with over 11 years of GI experience

Laredo, TXGastroenterology Consultants of Laredo – Laredo Digestive Health Center

• Full-time or part-time: perfect for young families• State-of-the-art endoscopic equipment• Physician efficiency and optimal patient quality of care• Light call schedule: 1:3• One hour to New York City• Beautiful scenic area

Ambulatory Center for Endoscopy, LLC Advanced Center for Endoscopy (ACE) has an immediate opportunity available for GI physicians looking for an outstanding ASC in which to perform procedures. Our single specialty GI center is the perfect environment for you and your patients.

ASCs provide physicians the predictability and efficiency in scheduling that most hospitals do not. Specialized focus by nurses and other support staff further increases efficiency. Our center can help drive additional patient volume to you through the ASC, allowing you to increase your procedure volume in the environment that is more convenient. Our center can provide your patients a better outcome, and you will have satisfied and loyal patients.

ACE is ideally located in North Bergen along the banks of the Hudson River—the “gold coast” of Northern NJ, with a spectacular view of the NYC skyline.

The nine physicians at Advanced Center for Endoscopy are partnered with Physicians Endoscopy (PE) in their state-of-the art endoscopy center. This is an excellent opportunity for a motivated physician.

For more information, contact:Monte Allen, DO - Medical Director(956) 795-4776 • [email protected]

Interested physicians should contact Meritus Health’s Physician Recruiter, Sid Gale at (301) 665-4508, [email protected] or by fax at (301) 733-5653. Or contact Daniel A. Elyard, Practice Manager at (301) 665-4539.

Hagerstown, MDThe physicians of Digestive Disorders Consultantsare seeking to expand their practice due to growth

Located in historic Washington County, MD, Digestive Disorders Consultants offers:

• Physician-owned and controlled center• Beneficial call schedule• State-of-the-art endoscopic equipment• Growing clinical research program that allows physi-cians opportunities to pursue clinical research studies• Location on the same campus and within walking distance of Meritus Medical Center, the local hospital • An easy driving distance to Washington, DC; Balti-more, MD; and Pittsburgh, PA

Digestive DisordersConsultants






Current GI Opportunities Current GI Opportunities

For more information, contact:Rob Puglisi, CASC, VP, Operations(215) 589-1051 • [email protected]

Bucks County, PAThe beautiful northern suburbs of Philadelphia

GASTROENTEROLOGY ASSOCIATE – Full or Part TimeExcellent opportunity to join a 100% clinical GI practice with an ambulatory endoscopy center in a beautiful suburb north of Philadelphia. The practice is well-established with a solid referral base which continues to grow. The physicians are university-trained, board-certified, and enjoy an excellent reputation in the community.

Patients are seen in a comfortable, newly-built office with a very pleasant working environment. Endoscopic procedures are performed in an ambulatory endoscopy center in which the physicians have an ownership stake. The physicians are affiliated with two community hospitals within 15 minutes of the office which have a solid reputation for providing quality medical care.

The successful candidate will be board-eligible/board-certified in GI and proficient in performing endoscopic procedures and consultations. ERCP and EUS experience are not necessary. Call will be shared equally. The daily schedule is reasonable with regularly scheduled time off in addition to a competitive salary, benefits, and vacation.

Partnership will be offered in the practice and endoscopy center. The position´s starting date is flexible.

For more information, contact:Kathy Harren, Office Manager(576) 248-3737 • [email protected]

Garden City, NYGastroenterology Associates – Long Island Center for Digestive Disease

The physicians of Gastroenterology Associates, a large single specialty private gastroenterology group, are seeking a BC/BE physician to start immediately or July 2015.

This candidate will have partnership/ownership opportunity in the affiliated endoscopic ambulatory surgery center. This three-room facility, located in Garden City, NY offers: • Physician-owned and controlled center • State-of-the-art endoscopic equipment • Physician efficiency and optimal patient quality of care • Professionally operated and managed

Gastroenterology Associates, one of the oldest and most respected GI practices on Long Island, has always prided themselves on being leaders in delivering the highest quality of specialized patient care.

Williamsville, NYGastroenterology Associates, LLP

A well-established practice with a solid referral base, Gastroenterology Associates, LLP, located in western New York, seeks a board-certified/board-eligible gastroenterologist to join our growing 12 physician practice. ERCP experience is a plus.

With two clinical sites and two physician - owned state-of-the-art endoscopy centers, this opportunity includes: • Partnership track in a premier quality driven group • Competitive compensation and benefits package • Nursing staff in our Centers with extensive GI experience • Fully integrated EMR environment. Meaningful Use attested • Professional management staff • 9 mid-level providers including registered dietician

Western New York offers four beautiful seasons, a wide variety of cultural and recreational opportunities and tremendous housing values. The area has many public and private colleges and universities, museums, galleries and major league professional sports teams. We are located within easy driving distance of The Finger Lakes Region, The Adirondack Mountains, The Great Lakes and Toronto.

For more information, contact:Peg Centola, Human Resources Manager [email protected] • Phone: 716-626-5250 • Fax: 716-565-0665





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EndoEconomics Spring 2015

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