In following up on COVID-19’s impact on the migration of orthopedic and spine cases to alternate sites of care, I interviewed Alejandro Badia, M.D., FACS, a Hand and Upper Limb Surgeon with a private practice in Miami. Dr. Badia is the Co-Founder and Chief Medical Officer of OrthoNOW®, a network of orthopedic urgent care centers. He has also authored Healthcare From The Trenches, a book blending his unique first-hand views on practicing medicine.
Dr. Badia’s perspective as a physician entrepreneur, analyst and author offers unique insights on our current times in orthopedic medicine and for orthopedic suppliers, especially as an exclusively outpatient-based surgeon. Over the course of two conversations, Dr. Badia shared his perspectives on healthcare, vendor engagement and pursuit of clinical and business leadership and influence. He generously responded to several questions.
What are your most common interactions with vendors—all of the representatives, as well as product specialists?
The typical interaction with vendors and product specialists is relatively informal. Dr. Badia is receptive to new products and may have those conversations in the office or in a less formal setting. As a result of these interactions, he may trial a product from a current supplier or new vendor on consignment to assess the need and opportunity to improve care.
Who negotiates pricing for instruments and products for your ambulatory settings?
With his office staff being small, long-term and trusted, much of the negotiation and purchasing is performed by the office manager as well as a procurement manager. Dr. Badia guides research and selection of products and then turns over negotiations and purchasing to the manager. He has not done inpatient work for many years, yet remembers the complexity and slow pace of decision making around elements of the O.R., product review and purchasing. By contrast with his hospital experience, decision-making is not committee-driven, rather surgeon directed based upon their needs. Their judgment of pricing is based upon what they’re paying for competitive products as well as the vendor’s sensitivity and awareness of typically lower ASC reimbursement rates.
The fact that all providers, leadership and decision-makers are in one building offers added convenience and speed to the practice in terms of evaluation and purchase of products. The number of vendors used can vary by category. Dr. Badia estimates that he regularly interacts with between 15 and 20 vendors.
Do you consider complementary or value-add features as important to your purchase of products?
Value-add offerings are not common. Occasionally programs offered that are complementary to a product or technology that might include supplemental equipment or something like patient education.
What are the greatest challenges that you had in interacting with vendors?
Most interactions with vendors are both productive and collaborative. The greatest challenge is the imbalance between surgeon reimbursement and product pricing. He has often sought and achieved better pricing considering this disparity. Dr. Badia also noted that third-party payors can also add cost and be overly restrictive regarding coverage, inserting themselves as external decision-makers who may or may not have the medical expertise to approve or deny coverage.
What is an example of a good vendor collaboration you have had?
Dr. Badia cites an example of the manufacture of a niche product, a thumb prosthesis with application for arthritis of the thumb. While Medicare does not pay for the implant, the vendor adjusted pricing to reflect lower outpatient reimbursement rates, making the technology purchase and use affordable. This collaboration has benefited all stakeholders; the patient with consistently good clinical outcomes, the surgeon/ASC with affordable products and vendor with a reliable market for their products. Additional factors lead to clinical decisions, such as using a thumb prosthesis, since these patients consume almost zero therapy services and the re-operation rate is essentially zero. Therefor, allowing the clinician to decide on optimal treatment can affect downstream expenditure of healthcare resources. This is a concept that most payors have yet to fully understand, yet it may benefit them the most within the ecosystem.
What advice would you offer physician owners and ambulatory surgery center operators in working with vendors?
First, seek active communication and dialogue with vendors. Cultivating a mutual understanding of clinical and business goals can foster high levels of collaboration. This stands in contrast to the circumstance where physician-owners and product suppliers have a largely price-focused and adversarial relationship. The illustration cited above is a prime example of a give-and-take partnership that accrues benefit to all parties.
Secondly, as the outpatient, ASC and ambulatory specialty centers continue to grow in number, market share and expanded clinical applications, physicians need to seek and capitalize on leadership opportunities. His view is that COVID-19 has been a catalyst to surgical care in outpatient settings due to patient preference, fewer complications, process standardization by procedure, optimization of the patient, and comparable or better outcomes than seen in inpatient settings.
It is notable that while Dr. Badia is profoundly committed to all aspects of medicine and his clinical specialty, it is his passion and advocacy for physicians to become more educated, active and influential in the business of medicine. Some have contrasted two perspectives: the Heads-down and the Heads-up surgeon. The Heads-down physician is primarily, and legitimately, focused on clinic and surgical practice exclusively, while the Heads-up surgeon maintains both these focuses and enlarges their perspective and involvement in business matters.
The results of the broader view are typically greater control over their practice and influence among peers and other health care organizations and professionals. He feels that surgeons are uniquely positioned to become active drivers of change and involved in all elements of clinical, financial, operational and patient experience elements. Circling back to the topic of vendor value-added products and services, any offering (e.g. product feature, patient engagement and education) that supports broader surgeon aspirations will be likely to receive consideration.
Dr. Badia’s exceptional accomplishments, advisements and diverse interests offer a highly credible perspective to both physicians and other healthcare professionals. As an entrepreneurial medical pioneer, he views vendors and suppliers as collaborative partners sharing an interest in bringing immediate access to superior orthopedic specialty care with a foundation of clinical and economic value.
Patrick Vega, MS, is Consulting Director for Vizient Advisory Solutions. Mr. Vega consults to member hospitals, health systems and physicians in musculoskeletal services with a focus on high-value care by aligning cost, quality and performance.