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Business Observer Friday, Feb. 5, 2016 6 years ago

Staying solo

To stay ahead of declining reimbursements, doctors who operate solo practices have to stay on the cutting edge.
by: Jean Gruss Contributing Writer

Solo practitioners in medicine are a rare breed.

That's because to stay in business they have to be innovative and take big risks with their own capital, uncertain of how government and insurers will reimburse them in the future.

“Your hands are kind of forced,” says Robert Zehr, a Naples surgeon whose office walls are papered with printed bar charts showing revenues and caseloads. He has operated a solo practice in Naples called Zehr Center for Orthopaedics since 2007.

Zehr, who moved to Naples in 1998 to spearhead the Cleveland Clinic's move here, recently opened Seaside Surgery Center with joint-replacement surgeon Kurtis Biggs to perform same-day total hip and knee replacements on an outpatient basis, one of the few centers in the country to offer this surgery. Patients at Seaside can be on the operating table at 7 a.m. and be home by noon.

With a $2 million loan from BMO Bank of Montreal, Zehr and Biggs teamed up with several other orthopedic surgeons and podiatrists to open Seaside. Their partner in the deal is SurgCenter Development, a California-based company that develops and manages outpatient centers with local doctors and retains an ownership stake.

Zehr, Biggs and their partners invested their own capital in the center and will share monthly dividends when they start being paid out in April. SurgCenter is the single-largest shareholder in the venture, Zehr says.

The benefit to doctors who operate their own outpatient centers such as Seaside is that they can claim the fees that hospitals earn from government and private insurance reimbursements. Surgery fees alone make it difficult for solo practitioners to stay in business because those reimbursements continue to decline. “The costs of private practice are huge,” Zehr says.

Seaside has been busy since it opened Nov. 11. “We've done about 150 cases,” Zehr says. “It's a new project and it's doing well.”

Still, only certain kinds of patients qualify for total hip or knee replacements in an outpatient setting. “We're looking for people who are typically healthy,” Zehr says. Those with heart disease, poor lungs or other ailments require an overnight stay at the hospital.

Of course, hospitals may not be too keen to see the rise of centers such as Seaside. “Joint replacement is one of their biggest revenue producers,” Zehr acknowledges.

Zehr is carefully monitoring efforts in the Legislature to permit doctors like him to open suites where patients could recover for up to 72 hours after surgery in the outpatient center. Zehr has his eye on a currently empty twin building next to Seaside if the law passes. “The governor is behind this,” he says. “I'm sitting on pins and needles.”

Follow Jean Gruss on Twitter @JeanGruss

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