How Physicians Are Shifting Their Business Models to Emerge from the COVID-Crisis More Resilient Than Ever

You have probably heard a lot of the media out there about how bad the COVID-19 crisis is for doctors, both professionally and financially. We see in the news how practices are shut down and those physicians who are working in hard-hit areas have been overwhelmed at times.

Those things you have seen or read are true, but lost in the noise is the fact that some doctors are actually thriving in this time of uncertainty. My team and I wanted to explore our new reality as physicians and share what we can do to make the best of our current situation. 

Our New Reality

Many physicians, especially those doing elective procedures, are being negatively impacted by what is going on with COVID-19. As a result, we wanted to see how our fellow physicians are shifting their business models in response to the crisis and compile that information to share with others. Many physicians are struggling because they are losing income and quite a few are even in danger of closing their practices permanently. However, there are a number of physicians out there who have income through other means they had in place prior to this global pandemic and mandatory shutdowns. Some of those examples are highlighted here.

COVID-19 has unquestionably changed the medical landscape and the business of healthcare irreversibly. Over the past month, we asked many of our colleagues in a variety of practice settings questions about how the current pandemic is affecting them directly, and what other revenue streams they had in place to protect them from any severe fallout they may be facing. 

Problems we now face

A report published online April 23 by The Commonwealth Fund shows there has been a massive decline in outpatient office visits as patients have stayed home — some even deferring needed care — because of COVID-19. Primary care visits have been cut in half, and some specialties are seeing 75-80% decreases in patient volumes.

Spinal surgeon Lali Sekhon has found himself no longer able to provide in-office consults other than suture removals. Another doctor, who wished to remain anonymous has been calling patients and explaining that the risk of having surgery and staying in the hospital outweighs the potentially short wait time. “All of the major cancer and surgical societies have published guidelines on how to proceed with such cases, but there is a part of me that is as worried as my patients are if their disease progresses during this time,” she told us.

“This has dramatically impacted my orthopedic practice,” Trevor Turner, Director of the Center for Orthobiologics at Georgia Bone and Joint told us. “Initially we felt that having an independent ASC would be a welcome chance to relieve pressure on the hospitals by diverting the elective cases. However, with the guidance from regulatory authorities and national bodies, we have stopped all elective procedures - despite the fact that we are actively screening all patients who come into the clinic.” 

Caleb Kroll, a private practice interventional pain physician based in Bethesda, M.D. went from overbooked and up to a month-long wait to be seen, to a light schedule in less than 2 weeks. “We decided early on in mid-March to start converting to telemedicine appointments for follow-ups and new evals. By the beginning of this week we were at 100% telemedicine for all physicians” he told us. 

Laying off Staff

Kroll also has seen an enormous impact on revenue and as a result faces cutting half of his staff, with all physicians taking a substantial pay cut in the coming months. As Brian Dooreck, a Gastroenterologist with a clinical practice in South Florida worded it, "This is like everyone in your practice, employees included, taking a vacation at the same time."

Many private practitioners still have income coming in from procedures that were done months prior. Going forward this poses a problem with revenue because no money will be coming in from the current months. Dooreck told us: “if no business is being done or no procedures are being done, although we're booking some patients for procedures and we're rescheduling them, there's no billable income that's going to be generating a revenue stream three months down the line.”  

These are not the only problems physicians are facing: there are some losing benefits such as their own health insurance, and getting laid off by their employers and hospitals while all attention is directed toward COVID-19 efforts and non-essential practices or service lines are temporarily shuttered. 

Statistics 

According to a recent survey by the Florida Medical Association, 99.6% of physicians have experienced a decline in practice revenue or are anticipating a financial loss because of the coronavirus pandemic. More than 70% have reduced physician compensation and 55% have applied for loans. 

In addition to these findings, 

• 72% of respondents to the survey have reduced physician compensation.
• 55% have applied for loans. And 39% more are considering applying for loans.
• 4% of respondents have permanently or indefinitely closed their practices, while another 13% are considering permanently or indefinitely closing their practices.
• 26% of respondents have temporarily closed their practices. An additional 21% are considering temporarily closing their practices.

And according to a survey by the Primary Care Collaborative, half of primary care physicians are unsure of whether they will have the financial resources to keep their primary care practices open through the end of this crisis. 

Similarly, a recent national MGMA survey found that 97% of practices have been adversely affected financially by COVID-19. On average, the MGMA survey respondents reported a 55% decrease in practice revenue and a 60% decrease in patient volume since the beginning of the COVID-19 pandemic.

In a similar study by the California Medical Association, results showed that 95% of California physician practices are worried about their financial health due to the COVID-19 public health emergency. This same survey also found practice revenue has declined by 64% since March 1, 2020, with 75% of practices experiencing a revenue decline of 50% or greater. 

In addition to lost revenue and patient volume, the Florida Medical survey mentioned above found 42% of respondents have laid off staff. Additionally, 30% are considering laying off staff. We, too, found a significant portion of those who responded to our questions indicated they had furloughed or were making the tough decision to lay off much of their staff. Kristin Yates, an Ob/Gyn has had to furlough 13 of her 42 employees and decrease their hours as well. “[We’re] only seeing limited routine OB and emergency gynecology appointments. The volume has dropped dramatically. We are no longer doing any mammograms/bone density or routine check-ups.”

Plenty of physicians we reached out to are also losing good staff or laying them off because they can no longer afford to pay them. 

Common Concerns

When talking to a variety of medical professionals, we noticed some stark differences as well as common threads amongst our respondents. Across the board, the landscape in healthcare has been completely, and likely irrevocably, changed. 

“Our practice is entirely different than it was before the pandemic,” says Jonathan Hagedorn, Director of Neuromodulation at Mayo Clinic. “Before the pandemic, our entire division was housed on-site. We had physicians in the clinic, procedural suites, the hospital, and operating rooms. Now, we are nearly entirely working from home, except for two physicians at each hospital on in-patient pain duties.”

Amber Bokhari told us some of the ways her clinic is adapting, as well as some of the challenges these changes bring: “We have started using online meeting software on our personal devices to adapt to the challenge of new telemedicine appointments with insufficient hardware available like speakers, cameras, and microphones. Likewise, most staff meetings have been moved to the virtual space. We are all trying our best to minimize hospital patient encounters by rounding with residents at workrooms and minimizing the number of personnel in droplet isolation rooms.”

Many, if not most of the people we talked to are just focused on surviving, and the majority did not indicate they had other revenue streams they could rely on if the pandemic were to go on for months. 

Unsurprisingly, a large number of individuals we spoke to are now doing telemedicine. “We started preparing for telemedicine several months ago and now we are full in telemedicine. That protects our patients and our personnel. There are still a lot more things to do but at least this is the beginning.” Ricardo Correa told us. 

“Telemedicine is a new frontier in pain management and we are still developing the best ways to do it. Testing for compliance is a challenge we have approached by mailing the requisition forms and saliva tests that can be performed live on film. The biggest challenges are physical exams, access to technology and communication.” According to Estelle Farrell, Physiatrist at Valley Of The Sun Institute For Pain Management, PLLC, and Pima Pain Center. 

Healthcare is constantly changing, and physicians have always had to adapt. However, the current COVID-19 crisis has tested our resilience and capacity for adjusting to this new normal. Fortunately, it is unlikely that we will have to face anything like this again in our careers, but it is still wise to be prepared. 

As pediatric psychiatrist and author Bryan J. Dixon pointed out, “This too shall pass. As a physician entrepreneur, we need to use this downtime to tighten up corporate practices, clean up processes, review market strategies, and shore up best clinical practices so that we emerge from this time stronger and more efficient. Private practice is an amalgam of small business and clinical prowess; that means triple the duty to do it and do it well.

Unique perspectives and opportunities

“Now, more than ever, for a practice to survive, it needs to think ‘outside the box’” according to Amar Setty, Anesthesiologist, Entrepreneur & Health Care Consultant. “Every practice should embrace Remote Patient Care (Telehealth and Remote Patient Monitoring (RPM)) to maintain patient care, monitor therapeutic benefit, and identify problems before they become serious. Treatment failure and admission to a hospital are not options in the time of COVID-19. Thus, there are clinical and economic reasons to embrace what you may have been reluctant to do in the past.”

Caleb Kroll reminded us, “This is obviously an extraordinary event in human history for so many reasons, so it would be impossible to completely prepare for something that has so drastically altered the way we practice and the financial means of practicing as well. I think this pandemic has opened our eyes to the need to be better prepared financially to be able to weather future storms. We will have to focus on more cash reserves and maybe diversifying our revenue stream after we make it out of this as a practice.”

Of those we talked to for this article who are flourishing or at the very least are not completely threatened by the pandemic leading to the shut-down of their practice, the majority had additional revenue streams outside of a typical office-based practice. This included writing, coaching, public speaking engagements now adapted to online conferencing, and online courses among the top answers. Perhaps you are passionate about a topic or a cause that aligns with your expertise. There are ways to have a bigger impact on healthcare and the well-being of your patients. For example, you could leverage such intellectual property into a book or a keynote speech. 

Michael J. Peck, who officially entered retirement on April 6th has recently been appointed Chief Medical Officer for an innovative startup that’s created a unique life-saving device he hopes will be approved via the Emergency Use Allowance of the FDA. He finds himself in the midst of raising money and talking to various large entities as well as filing with the FDA.

Maiysha Clairborne’s coaching practice has remained steady since the crisis. She believes it’s because she’s helping physicians who reclaim their autonomy and freedom as more doctors than ever are beginning to think about stepping out of employed-positions and starting their own practices. She’s launching her second mastermind and coach certification training in the fall for doctors who want to do deep self-healing work post-COVID-19, while simultaneously learning the skills to be able to help their patients on a deeper level as well.

“Even though my business hasn’t been directly impacted yet, in anticipation I did launch a lower-priced option for physicians and APP’s who wanted to get started but didn’t feel they were ready for the full-on coaching relationship. I basically housed my teachings and curriculum in a low monthly membership for easy affordable access to my colleagues.” She told us. Another example was a CDC contractor who contacted me to do weekly meditation breaks for them for a nice consulting fee.

Some doctors are using this time to find other ways to generate income unrelated to healthcare, outside of their practice. Because he is not currently doing locums assignments, Edwin Leap says that he finds more time to focus on his creative outlets. He has had the opportunity to pursue more paid writing gigs with outlets such as MedPage Today, Lippincott, and a local newspaper which he has been doing for the last 20 years. 

The Future

If there is anything this pandemic has shown physicians it is that we cannot depend on the practice of medicine to provide financial stability and security - for ourselves, our families, or our employees. We need to have other income streams in place outside of our medical practices that we can depend on. 

Have you been thinking about how great it would be to be seen as a thought leader and make a bigger impact in the world beyond your appointments with patients? Drop me a note and we can talk about how we've guided other physicians to build a platform and additional streams of income outside of their practice.

Christopher Burton, MD

www.christopherburtonmd.com