Posted by John O. Goodman, President
Overview
Throughout 2008 there were multiple publications and reports stating that cardiac catheterizations and other cardiac procedures were either flat or declined. If you were to review only the number of catheterizations, interventions, and other cardiac procedures, you might conclude that heart disease is declining. In fact, heart disease is not declining and the need for cardiac care is actually increasing, but our ability to care for patients at an earlier stage of the disease has decreased. Since 2005, we have had more cardiologists retire, die, or radically reduce their practice availability, while the number of newly graduating fellows has been fewer than the number of cardiologists leaving practice. For example, approximately 1200 to 1300 cardiologists are retiring or departing annually, while approximately 700 cardiologists are graduating, resulting in a net decrease of approximately 500 to 600 fewer cardiologists annually. As a result, practicing cardiologists are working harder in every part of the country, and taking care of sicker patients just to keep what appears to be a level state of procedure volumes.
The traditional approach to providing comprehensive cardiovascular care varies dramatically throughout the United States, yet in most institutions, a close and formally organized effort between hospital executive administration and physicians minimally exists, if at all. The same is true as it relates to peripheral vascular care. In fact, virtually no formal organizational management structure exists between the physicians and the executive administration of most hospitals. Our country is in the worst financial condition any of us have ever seen, and our healthcare system has been struggling for even longer. I strongly recommend that you examine your growth opportunities related to cardiovascular care and peripheral vascular care, and examine how you approach those opportunities.
Commencing this year and continuing for the next several years, some of you will elect to go through paradigm shifts that will enable you to organize your programs more effectively, recruit an appropriate number of physicians to meet your program needs, and watch your revenues increase significantly. Remember, while we may reach as high as 15 percent unemployment, 75 to 85 percent of the patients in each of your markets will have some payment capability through their employers, Medicare, or alternative sources.
In summary, I believe the hospitals with the greatest opportunities will be the hospitals that are 100 to 350 beds in size. My belief is based on the fact that the small and intermediate-sized hospitals do not have complex bureaucracies when it comes to making decisions and changing paradigms to meet our new healthcare challenges. Certainly, some large hospitals will be able to overcome their bureaucratic structures, but the smaller hospitals are able to move more quickly if they elect to.
Needed Cardiology Changes Now And In The Future
Unlike yesterday or today, for the future you must develop a very close formal working relationship with your cardiologists and other supporting specialties in order to understand their goals, their needs, and their overall lifestyle objectives. In the past we assumed that every hospital’s cardiologists would work as hard as they possibly could even if it meant spending less time with their families. Based on our surveys and the findings of other consulting firms, newly graduating fellows indicate that their number one goal is quality of life relative to where they intend to practice their profession. I know many of you are changing your approaches to working with your existing cardiologists and examining your strategies for recruiting new cardiologists to match up with future cardiologists’ attitudes and objectives. I strongly encourage all of you to examine your approach and make the necessary adjustments.
Next, it is essential for hospitals and cardiology groups alike to understand the number of cardiologists that will be required within a given geographical area in order to have an effective market capture rate. Once again, your institution should create a formal structure with your cardiologists and other supporting specialties to truly understand your market, its size, and most importantly, the opportunities within your market that you are currently missing. With accurate market information and a close organizational relationship between executive administration and your physicians, you will be able to define your current physician needs and develop time tables for meeting those needs.
Additionally, your formal group of executive administrators and physicians need to examine your facility requirements, support staff requirements, and more importantly, your physician requirements for meeting the needs of the institution. I have found throughout 2007 and 2008 that most hospitals and physician groups were not utilizing enough physician assistants, RNs, and techs to increase the efficiency of their cardiologists. It is clear that in our marketplace we have an increasing need and demand for care and a decreasing supply of cardiac physicians to supply the care. Therefore, we must look at innovative strategies, staffing changes, and facility changes to be able to meet the demands and needs of a growing population and a decreasing physician base.
Finally, it is mandatory that the formal hospital-physician team develop a very specific set of strategies that commence with a 90-day short-term action plan, followed by a six-month action plan, and conclude with a long-term action plan (one to three years) that will drive all parties to meet their individual and group-defined goals.
Vascular Program Changes
I am currently working with clients throughout the United States who have recognized that peripheral artery care represents a market approximately 3.5 times the size of the cardiac (heart market). A great opportunity for many of you in the future, particularly hospitals ranging in size from 100 to 300 beds, will be to develop a very aggressive and large vascular program. Some challenges you will face include facility modifications and identifying your current and future physician requirements. Personally, I believe that vascular procedures in hospital settings will exceed heart procedures by the years 2013 to 2015.
Another challenge you face in developing your vascular program is identifying the different types of physicians who can effectively perform vascular procedures utilizing the latest technology and training. Currently, I am seeing some hospitals that are utilizing interventional cardiologists who have a strong desire to specialize in vascular intervention. Other institutions are pursuing newly trained endovascular surgeons as well as retrained cardiac surgeons. Other programs are utilizing interventional radiology as their primary base with endovascular surgeons and/or retrained cardiac surgeons backing up the radiologists.
In summary, it is mandatory that you develop a planning structure similar to the one I defined in the prior section that includes short, intermediate, and long-term goals and objectives, and utilizes your physician expertise and specialty mixes to achieve your targeted market opportunities.
Develop Winning Strategic Plans
Today and in many many months to come, each of you will be dealing with our financial crisis. Do not allow your opportunities in cardiovascular care to be derailed because of what is occurring in the macro United States market. You must keep your eyes on your target and all actions that require hitting that target. There are many doomsayers, but your success — particularly at small and medium-sized hospitals — will reside in your ability to create a winning team and develop specific strategies that will allow you to meet your target objectives.
Finally, I strongly encourage you to seek the assistance of consultants that have a proven track record of developing and building successful cardiovascular programs. Every hospital executive and cardiologist is tied up either in multiple meetings or taking care of patients or dealing with diversions and trying to reduce patient acuity at their institutions. Without an outside firm assisting you in the development of your strategies and facilitating the necessary meetings as well as formal development of plans, it will be extremely difficult to make the necessary paradigm shifts to capture your real market opportunities now and in the future. I encourage you to look at consulting firms that you believe fit the culture of your institution and your cardiologists, and certainly, I would like our firm to be considered. But most importantly, make a good informed decision that will result in your success.
