Wednesday, March 8, 2023

What the pandemic has taught us about the healthcare supply chain

Reports in September 2021 of dozens of cargo ships anchored off the coast of California, unable to deliver their goods to the Port of Los Angeles and Port of Long Beach, again underscored the fragility of supply chains.


Indeed it has been an issue throughout the pandemic, but it took a turn for the worse when COVID-19 variants emerged and workers were found to be in short supply at these ports, at least in part out of fear of infection. So the ships continued to bob in the Pacific Ocean, and industries continued to be without vital supplies.

No sector has been affected quite so much by fissures in the supply chain as healthcare. And as Cindy Juhas, chief strategy officer for the medical-equipment distributor CME, told the website KSL.com, the problem goes far deeper than delivery.

"A lot of the stuff we sell is not sitting in a warehouse where you just call and say send it over,” she said. “It needs to be built."

The end result, according to KSL, was that healthcare facilities had to wait as long as five months for certain types of exam tables, something that used to take no more than six weeks. Even the portable plastic toilets that are prevalent in patients’ hospital rooms, which Juhas said used to be immediately available, are taking three to four months to arrive at their intended destinations.

There are those, like Erik Anderson, president of the medical technology company Hologic, who believe shortages will persist until the midpoint of 2023. Still others wonder how the sector might fare when the next pandemic occurs (and experts seem to agree that that’s a matter of when, not if). In a piece that appeared on the site Politco.com, Michael Osterholm, director of the Center for Disease Research and Policy at the University of Minnesota, cited “an unsustainable reliance on China and India for our lifesaving generic drugs” as being one of the primary issues going forward.

It was that dependence on China that disrupted the supply chain very early in the pandemic. That nation produces a lion’s share of the world’s personal protective equipment (PPE) -- whether gowns, goggles or masks -- and when it became the epicenter of the outbreak late in 2019, the export of such equipment came to an abrupt halt.

That led to calls for more domestic PPE production, calls that were largely heeded by “nontraditional manufacturers and suppliers,” as Mike Schiller, senior director of supply chain for the American Hospital Association’s Association for Health Care Resources and Materials, put it in an interview that appeared on AHA.org in May 2021. Schiller nonetheless said that increasing the number of domestic PPE manufacturers will “take some time” and noted that even at that point, there was a shortage of gloves, not to mention syringes, sharps containers and sterilization wrap.


Still, he lauded the vendor-vetting program initiated by the Association for Healthcare Resource & Materials Management (AHRMM), which enabled healthcare organizations to weed out bad actors and identify legitimate manufacturers. And finally, he pointed out how valuable public-private partnerships have been in dealing with the crisis, and believes that while people tend to have short memories, “everybody is still very focused on the post-COVID-19 efforts needed to build a more resilient health care supply chain.”

He is, however, realistic about the challenges that lie ahead:
“I've been involved in a number of roundtable discussions with various organizations represented where COVID-19 health care supply chain resiliency is being addressed. The optimist in me hopes that these conversations not only continue, but that they result in a true environment of change; that the lessons we've learned and the partnerships that have been forged over the course of the last year remain in effect; that we do not settle back into our individual environments.”

Certainly there are other reasons healthcare organizations will continue to look for ways to improve supply-chain management, not the least of which is the pivot toward value-based care. Currently supply costs account for 40 to 45 percent of an organization’s operating budget, according to Gartner Research, though a post on Supplychainbrain.com noted that such costs have often been “a blind spot” for healthcare organizations. Understanding them -- and understanding how to control them -- is crucial to getting a handle on the total cost of care. Gartner projects that they can be reduced by as much as 15 percent through astute oversight.

That means melding proven approaches with new technologies, which besides resulting in improved overall cost-effectiveness and efficiency, can lead to physicians receiving their preferred products and nurses seeing their loads lightened. Fully 86 percent of them responding to one survey cited supply-chain workflows as a stressor, and 85 percent of them saw documenting supplies as a challenge.

But the ultimate goal is improved outcomes. That’s the bottom line, the Holy Grail. And never has that been clearer than it is now, as the pandemic rages on and ships continue to bob in the Pacific.


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Tuesday, March 7, 2023

Physician practice exit considerations

Regarding succession planning, I have been approached by physicians looking to exit their practice anywhere from three months to seven years. I cannot stress enough the importance of planning ahead, especially if you are a solo medical practice; anything short of twelve months and you will almost always find yourself on the losing side of the transaction. This article is aimed at any physician contemplating exiting their practice at some point. Perhaps you are finally at the point in life where you are considering retirement; with all the work you have put into your practice, retirement is a welcome sign and you are contemplating selling. Most physicians are caught on the “entrepreneur merry-go-round”, dealing with business issues, family, staff, banks and so on, and find it difficult even to plan this year’s strategy, let alone figure out whether it’s time to sell.


Initial questions to ponder


As you begin to contemplate selling, ask yourself why are you wanting to do so, because most buyers will ask you this exact question. It is fine if you are retiring or looking for a new challenge, etc., just be honest with yourself.Along those lines, consider why someone should buy your practice. Do you have new equipment, a strong referral base, large patient volume, solid financials, etc.?Remember that a new owner is primarily interested in how much cash the practice will generate.

The need to start planning early for an exit
If your passion has waned and you’re finding it more difficult to get excited about growing your practice, then now might be the time to consider selling. After all, if you’re not building your practice and continually thinking about next steps, it could start declining, making it more difficult to sell. It is much easier to sell a medical practice that’s on an upward trajectory.

If the business is going to collapse without you there, that will become apparent during the due diligence phase. If your practice has several physicians but you do not have proper succession in place, you’ll need to work on moving other physicians into the roles to replace you eventually. You should seriously consider calling a transaction consultant who can help you through the process. Ideally, you want to contact an experienced consultant at least two to three years before selling, to gather from him or her what housekeeping needs to be done in your medical practice to get it ready for market. Unfortunately, many physicians are so caught up in the day-to-day running of a practice that they put all of this off until they are less than a year from wanting to retire.

Major steps in selling your practice
When exiting your practice, you will certainly want to consider who your potential buyers are, and it may not be as easy as you think. Selling a medical practice is more than a tour of the office, a handshake and exchanging a check. It can be complicated, often messy and intense. It will take several months of data gathering, negotiations, analysis and various emotions before it’s over. In its simplest form, here are four of the major steps in proceeding with the sale of your practice:

1. Nondisclosure agreement.The first step is giving the potential buyer just enough information to help determine a price. It’s important that you don’t give a potential buyer any information until they have signed a nondisclosure agreement. This will protect your information and ensure the buyer is only using it to formulate an offer.

2.Due diligence. After preliminary due diligence using the information you have supplied them with, as well as other research, the buyer will typically give a range of value for your practice, which may or may not be in line with your asking price. If discussions are going well, then the potential buyer will likely want to examine more items as part of their due diligence, including tax returns, key contracts and agreements, etc.

3.Letter of intent. Once the buyer has a cohesive picture of your practice, they can hone in on a more precise value. This is laid out in a letter of intent, which covers the purchase price, the structure of the deal, whether it is an asset or stock sale, the escrow parameters, the working capital allowance, and other details. While this is a very intentional document, it is non-binding.

4.Purchase agreement. After negotiation, review of legal terms and final due diligence, a purchase agreement is created. This is the legally binding agreement which is agreed upon by both parties and will be a road map for how things play out once the deal is closed.

You may opt to stay on


While you might be thinking of selling your practice and retiring, you might instead wish to stay on in a consultancy role, part time. In fact, practice owners may be asked to stay on temporarily after a sale has been executed, even if only in a part-time role. This arrangement is somewhat common for many medical practices to ensure continuity because perhaps the biggest source of concern for prospective buyers is that existing patients will disappear when ownership changes. Any reductions would diminish the value of a buyer’s newly acquired asset. There are a few considerations though that you might want to think about. For example, as a seller you may anticipate less money up-front as this will be offset by a “salary” to help in continuity with patients and referring physicians.

Final thoughts


Selling your medical practice can be financially rewarding as well as give you the personal satisfaction that what you created will continue after you. Your patients will be happy, and the jobs your practice provides will continue. Also, you will give another physician a chance to be a small business owner.While each medical practice owner chases success in his or her own unique way, there are some things nearly all physician practice owners have in common: hard work, determination, a vision of what could be, and the will to make it happen. But there is also another common factor that binds together all physician practice owners: the need to someday transition your practice to its next owner.


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Monday, March 6, 2023

My last patient


Max Burger, MD


My last patient was a challenge, as all patients always seemed to be at the end of the day. Was it fatigue, impatience, or exasperation, or all of the above that made me want to complain to him about spoiling my last day? He was late, so he was asked to wait, which he did without a fight-because not only did he come late often, but he frequently missed appointments and the visits lasted longer as I played catch-up to deal with what was unfinished from previous visits. He had chronic lung disease, asthma, heart disease, and poor circulation, but he reassured me that he was trying to stop smoking, as we discussed at every visit. He was well aware that cigarette smoking exacerbated many of his problems. He may not have been aware that discussing smoking cessation was part of a quality improvement measure for which I could and should bill at every visit. For some patients, their insurance would demand I show that I did counseling but would not pay for the "procedure," so I was in the unfortunate position of often failing to include this "quality" measure (all detected by a billing code) for fear that my patients would be charged. In this fee-for-each-service, insurance paid after-the-fact medical system, I and the patients both lost. I was not given credit for the time spent discussing their needs and the patients were in fear of yet more charges for a visit, so they were reluctant to come and reluctant to talk.


Nevertheless, after the discussion about considering choices for how to stop smoking, I moved on to quantify how often he was using his inhalers. This was a way to measure his compliance and how bad he was feeling, but the answer was confounded: he used the inhalers sparingly since his drug co-pays were high and he didn’t want to run out when he “really” needed them. When I listened to his lungs, his wheezing was less than during his “emergency” visits, which were usually more frequent and dramatic than today's "maintenance" visit. Here was a man who had lousy insurance where the cost of his drugs decreased his use of them, increased his need for often emergent medical care, (which we all pay for one way or another), and decreased his ability to feel well, function and, simply, to breathe. I had long ago given up on providing samples of expensive drugs because I knew that the samples would eventually run out, so I tried to prescribe the cheapest generics available. Albuterol, an old mainstay of inhalers was, ironically, more expensive now because there was no generic. It used to cost $5-10 with insurance., but the previous propellant used (CFCs) was banned because of environmental concerns. Now the brand inhalers, with a new propellant and same active drug, $5-50 with insurance and $30-60 without, not because the active drug cost more, but because the pharmaceutical companies held the patents on the new "delivery system" and could charge more. Another argument for drug cost regulations. Free markets do not work.

His wife had just been discharged from the hospital for pneumonia. It was still cold, so he planned on taking her down to Florida to visit his daughter who had breast cancer. He needed refills on all his medications because he wasn’t sure how long he would be down there and had not selected a new physician yet. I surmised that this was a “last licks” visit. Nevertheless, I wrote prescriptions for him to last a while since I knew he would not be back to see anyone soon if he could help it.

His chest pain was infrequent as were his leg cramps from his decreased circulation, although they worsened in the cold weather, as was his back pain. Yes, he needed some pain medication since there were days he was more stiff getting in and out of the cars in the cold parking lots where he was warehousing all day, so I gave him some codeine. He had been sensitive to anti-inflammatories like ibuprofen, which had a greater risk of exacerbating his heart disease than the codeine. I would probably be flagged by his insurance's pharmacy benefit manager algorithm as being a dangerous prescriber contributing to the opioid epidemic.

He had a toothache and wanted antibiotics, so he would not have to see a dentist since, like most patients I saw, he did not have a dental plan. I had given him antibiotics before when the swelling was so severe that I was worried he would get an abscess and a blood infection. But this time, since there would be no follow up with me and no evidence of an abscess on examination, only bad gums and teeth with many cavities, I declined and told him to see a dentist. He knew that was going to be my answer, but he had tried anyway. Antibiotics as the answer for many ailments was a constant demand in my and all primary care practices. Our patients learned over many years that we were previously eager to please to get them out of the office and to avoid an expensive and inconvenient revisit. Despite our experience of how dangerous and devastating drug resistance is, we are still besieged for the "magic bullet."

He was depressed. His wife was still sick, and he thought his daughter was dying. He had no money and hated his job and wanted to retire, but he was not sure he could afford to. He had anxiety attacks, the last when he was stuck in an elevator in the hospital in Florida while visiting his daughter. He wanted something for his anxiety. This was not the first time I had heard and seen that he was depressed or anxious, and I wanted to give him an antidepressant. But I wouldn’t be able to monitor the effects of the medication and he likely wouldn’t seek out or be able to find a counselor who would take Medicare, so instead I gave him a low dose of Alprazolam and warned him to use it only for "emergencies." He was good at that since he only used medication when he thought he needed it. Again, I was aware I could be flagged for prescribing the potentially dangerous combination of codeine and benzodiazepines to an elderly patient, but I assessed his risk as low since, as his personal physician, I had known him for years.

I heard and saw his apprehension about my leaving. I glanced back at him from the screen of my EHR when he said key words like "pain" and "sad," looking at his face to assess him rather than the computer display. After 16 years of using a much simpler and user-friendly program, I hated the new EHR I was using, which was the choice of the hospital group that had bought my practice. Many other hospitals and large medical groups were using it, not because it was useful for the end-users, but because it fulfilled requirements that large organizations were told they needed. I had to jump between multiple fields to get the details and the whole story down, all the while correcting data and his prescription list that had been incorrectly loaded from previous visits or sloppily recorded by staff. Renewing each medication was a painful series of multiple steps for each prescription.

I ignored the “metrics” sections that flashed in front of me and urged me to do more health maintenance. The program had failed to accurately transfer the information from the previous system and required so much more time to correct and update that it was another distraction from really taking the time and caring for my patient. I knew what health maintenance he needed, the EMR didn't.

I finally finished his note by entering his ICD-10 codes for his “diagnoses” which were used to bill the visit, and inexactly and insufficiently describe the state of his illnesses. To correct the imprecision, the number of codes to search had been increased from the ICD-9's 13,000 to ICD-10's 68,000. What the wonks called "granularity." It did not address his emotional state, or how he or I felt he was doing. It required even more effort for me to search the proper diagnoses, even with the computer's search module, so to save time (my patient was still there), I settled for any close code. So much for granularity.

Once I had completed that, I entered the CPT billing, codes which insufficiently described the work I had done. This data would be provided to him in a summary, including his medications and instructions for any further care and a plan for the next visit. This required more time since someone else was going to see him and those notes. The data would then be stored and could be "analyzed" by anyone who presumed the numbers measured "quality" and "outcomes" and "value."

Despite all the time I spent processing his data and not attending to him, he thanked me for the care I had given him through the years. We hugged, and I reminded him to be compliant, stop smoking, and see a new doctor soon.

It took me days after my last clinical hours to finish all those notes from the last few weeks because saying goodbye simply took longer. I had been fully booked the past month, and there were others who realized I was leaving and still wanted to see me. I felt wanted and appreciated, accepting all the greeting cards and small gifts and saying goodbye to those well-wishers who just dropped in between patients.

Why was I retiring? I liked my interactions with my patients, my long-term relationships, and the mental and psychological challenges, but the overwhelming pressure of productivity, documentation, recording data, and "meeting metrics" had worn me down. It had begun a few years before I sold my practice, when I saw a sudden downturn in visits because of new insurance plans with higher deductibles and co-pays and fewer benefits that well-preceded Obamacare. I knew I had to catch up with the changes the insurers were forcing on me and my patients. The Affordable Care Act helped to decrease the pain of cost and decreased accessibility for some, but the effect of the widespread insurance companies increase in patient-shared costs for the majority of Americans could not be staunched by that weak band-aid.


It got worse when I was offered a potential increase in income by enrolling in the Patient Centered Medical Home (PCMH) initiative started by a semi-private organization and supported by some insurers to "improve" care by demonstrating quality and adding "value." I gave up trying when I spent too many hours filling out online forms and could not get answers as to what more they needed for me to show quality. They did not guarantee any increase in income.

Fooled once, I tried again when I enrolled in the Comprehensive Primary Care Initiative (CPCI), a pilot study initiated for Medicare and Medicaid to also "improve" care and make "providers" more attentive to patients' needs. I actually got paid more for providing more "data." Although I demonstrated that their definitions of patients needs for care were being met, I was sure my patients did not see a difference except that I was more stressed and inattentive to them.

I was spending even more of my time on documentation and metrics, things that lower trained staff could do if I hired them and used the "increased" income to pay them. I had hired a part-time nurse "care manager" who loved her job, but her only impact was to improve my numbers. My other staff was pressed to do the same and they were stressed as well, even if they were paid more overtime. I was reaching burnout.

If this was the future of medicine, I thought to myself, I needed to have more help from a bigger organization, so I sold to the local hospital, not an unusual move for small practices, and still a continuing trend. (The number of solo and small primary care practices has fallen from 40.5 percent in 1984 to 17.1 percent in 2014.) There I thought I could practice without as many of the extraneous duties since someone in that big organization should be organizing and delegating the tasks that were not the practice of medicine. Fool me three times because they did not have the manpower or the understanding of what these new initiatives were intended to do. One of the key points of the PCMH and CPCI programs was to make each "provider" (I hate the term-I used to be a doctor) responsible and responsive to their patients in a team, but no one in my practice was trained in that kind of teamwork beyond what I had already done. They were discouraged from spending more time to be a team since it did not fit their job descriptions. One of my best medical assistants left in frustration, succeeded by a series of "temps" and then "professional" hospital employees who used the administrative rules to avoid extra work. It became even more painful when the new EHR was introduced and I, as others in the group, left, overwhelmed by the awful technology.

We are all besieged by the demands of management of costs, time, and ultimately, the priorities we set for our lives and the lives of our patients. I can understand that we need to change how we practice medicine and deliver care. I have confidence that the right technology will help and that, although we are failing in all the alternatives, we will ultimately find the right solution.

A universal, single payer healthcare system would help. The fee-for-service, insurance-based model has failed and has cost us more in healthcare expenditures and quality than most other nations. The percent of the USA's Gross Domestic Product (GDP) expenditure for healthcare is 17.2 percent. The range of cost for most other developed countries, especially those more successful in WHO healthcare measures is 9.3-11.5 percent of GDP. Our ranking in the WHO list is 35, France is first (GDP 11.5 percent), Canada is 30 (GDP 10.4 percent) and the UK is 18 (GDP 9.7 percent). All three have a universal health system. Where is all the money going? As I described above, huge amounts of time and money is spent saying what we did, imperfectly, and still more is paid to middlemen (insurers) to process those payments.

Healthcare should not be discrete episodes of care but comprehensive and continuous and integrated. Primary care physicians often don't know what specialists and hospitals, urgent care centers, minute clinics and now, pharmacies, have done and vice versa. We still need a unified, standardized, interoperable, simply interfaced, well-constructed EHR system, supported by adequate staff.

As I demonstrated, I and my fellow physicians, have become the most expensive component of the medical data entry system, spending precious time away from treating patients. There have been some experiments with "scribes" who can enter patient and physician interactions, but the other support staff, including physician assistants, nurse practitioners, nurses, medical assistants, dietitians, psychiatric and social work counselors, physiatrists, and other office staff, have to be part of the team.

We need more primary care physicians. Most developed countries that have been successful in delivering cost-effective care by most measures have .64-1.29 primary care physicians per 1000 of the population. We have .31 per 1000! Medical schools have been part of the problem. From the cost of education, to the bias of training in the schools for specialty and hospital-based systems, and the dearth of ambulatory-based primary care residencies, they have perpetuated the system. I was a foreign medical graduate from Ireland, and from day one I was trained with the perspective that I would be a primary care physician. I benefited from that perspective and training. There is no good reason that every American medical school should not have that same perspective. Congratulations to New York University for taking the right step of free medical education and the University of Texas at Houston for declaring primary care training as its goal. There should be more of that.

Retirement was inevitable as are taxes and death, hopefully in that order. I have no regrets, but I do have concerns, as I did for my last patient. When I hear a politician say we have the best healthcare system in the world, I can only think he or she is talking about their Congressional healthcare benefits. Most other Americans don't have that or feel that way. I still don't have that or feel that way. We can and should do better.


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