A Day at the Office: What Should Private Practice Orthopaedic Surgery Learn from COVID-19?

Writing about coronavirus-2019 (COVID-19) in a monthly publication is like trying to get a firm grip on wet soap. But as a case study in disruption, I believe that the impact of COVID-19 on private orthopaedic surgical practices offers many generalizable messages that can help us be more prepared for the next crisis. Of course, the most important impact has been on the health and safety of our patients; as of this writing, more than 210,000 Americans have died of this disease, and the worldwide death toll just exceeded one million. This is a tragedy by every definition, and I would not for one moment minimize this.

But a key focus of my column is the business of private practice. I hope that talking business in times of tragedy does not come across as callous, but I believe that the viability of private practices is a key determinant of the ongoing good health of the populations in which they exist, and in this setting, the phrase “no margin, no mission” certainly applies. For those reasons, there are both humanitarian and business reasons to learn what we can learn from the COVID-19 experience as an exemplar of what happens to orthopaedic practices in very lean times, how they can adapt, what happens when they don’t, and how we can mitigate the damage in whatever remains of the current crisis as well as any future ones that cause dramatic downturns in the volume of elective surgery that orthopaedic surgeons perform.

In particular, I’d like to discuss three key lessons: (1) We need to remember the crisis that we all endured and effectively navigated to some degree; (2) we need to remember the lessons of austerity; and (3) we need to prepare effectively for the next crisis and maintain memories of our best practices from this one.

How Did Private Practicing Orthopaedic Surgeons Navigate the Crisis?

As of this writing, COVID-19’s impact on the private practice of orthopaedic surgery is still evolving, but it’s no secret that private practices were forced to make difficult financial decisions, perhaps the most difficult among them being the firing of valued staff members, once the nation’s economy shut down. Results from a recent survey of more than 3500 US physicians are alarming: 41% saw volume decreases of 26% or more, 43% of physicians have reduced staff due to COVID-19, and 8% of physicians have closed their practices as a result of COVID-19 [3]. Let’s put that 8% in perspective. There are about 200,000 medical practices in the United States [3]. Losing 8% of those means that 16,000 practices across the United States closed. How many frontline workers and rank-and-file employees lost their jobs? How many patients lost their medical care? These are devastating numbers.

The decrease in patient visits hit private practices hard, and it hit us fast. The number of visits to orthopaedic practices declined by more than 60% by early April [2]. Without significant liquid assets or lines of credit to cover the ongoing expenses of doing business, many orthopaedic groups in the southeast, where I work, responded with austerity measures just to keep the practice afloat. Our practice, for example, required staff to use up their paid time-off during the pandemic, and this was met with gratitude from some and disenchantment from others. Though the Paycheck Protection Program muted some of the fiscal impact [1], practices in some cases were forced to fire or furlough clinical and administrative staff and/or physician’s assistants and nurse practitioners. Some practices, or their patients as a way of supporting the practice, even turned to GoFundMe, an online crowdfunding platform, to help pay off overhead bills [4].

The Lessons of Austerity

When the pandemic shut down private practices, many practice owners found themselves contractually obligated to pay for what now appear to be unnecessary goods and services. Things like laundry services that require the practice to pay a certain amount every week, even though there was no laundry being generated in the shutdown. Many private practices had to pay full rent even though no one used the space for months. While many of these third-party companies allowed their rates to be negotiated down during the heat of the pandemic, these businesses also require cash flow to keep their doors open and pay their own employees. When renewing contracts in the future, look for “crisis language” that allows your practice to decrease or stop payments when the practice is unable to generate revenue. Ascertain which goods and services are essential to the practice’s success, and mitigate the financial drain that unnecessary luxury items have on cash flow.

During the height of the pandemic, we found that most staffers can work efficiently from home. This discovery can potentially decrease occupancy expenses, since we may be able to decrease the size of our offices in the future. The fewer in-office workstations your practice uses, the less your information technology vendor needs to cover, which could reduce your information technology bill. Orthopaedic practices should try to maintain the efficiency that was forced upon us, which may become the new-normal way of doing business.

How Can Private Practices Prepare for the Next Crisis?

Orthopaedic practices should proceed with caution before returning to normal, or even the “new normal.” As of this writing (early in November 2020), COVID-19 remains a health crisis in the United States, and it appears as though it will remain one for some time yet. For example, nearly 50% of physicians believe the coronavirus pandemic will not be under control until sometime after June 1, 2021 [3]. Although we’re not yet done with this one, we need to start preparing for the next crisis. It will come.

Think about how to manage your practice’s employees during the next crisis. Begin by determining which staff members need to be retained; the number may be fewer than seems to be the case at first glance. For those who are “nonessential,” develop a communications plan in advance of the crisis and a severance package so that they can be removed from the payroll if that should become necessary. This is not easy; to do this, you’ll need to determine whose contributions are critically necessary without making people feel as though they are just “resources.” Finally, analyze the remaining staff to understand the most effective way to decrease overhead while also being mindful of staff morale. This sounds horribly Machiavellian, but we must act decisively to keep our practices viable during a crisis. And yet, the harsh difficulties that many had to endure during the pandemic cannot be glossed over by looking at a financial spreadsheet.

Previous plans should also be reevaluated to ensure that the practice can afford to spend capital during this time, both now during COVID-19 and in the inevitable crises to come. While practice leaders should be cautious during these times, we should not let fear and uncertainty prevent us from seizing on a financially beneficial opportunity. How can we “take advantage” of a future crisis? Look for opportunities to consolidate with other practices and ancillary lines. Prime real estate may suddenly become available so that the practice can relocate to a more favorable location.

While each situation is different, I believe many of the changes efficient practices made during this pandemic—in particular, the increased use of telemedicine, employees working from home, and keeping the more trimmed down staffing models as the new norm—will continue to deliver value long after the crisis passes. Practices that fail to learn the lessons of this pandemic will be especially vulnerable to the next crisis.