Practices Make Perfect

In the wake of Kaiser Permanente's departure, Primary Care Health Partners is bringing its doctors back to genuine private practice, with a twist

by Virginia Lindauer Simmon

After a peripatetic career, Bob Bycer thinks he's found his niche shepherding a physician-owned group of medical practices into life after Kaiser Permanente.

A long time ago, doctors were entrepreneurs who practiced medicine out of small offices or their homes. The business end of doctoring was simpler then. Paperwork largely consisted of keeping notes on patients and their health and issuing bills (while often taking payment in pies, eggs and livestock).

But things changed over the 20th century. Insurance and government regulation meant an increasing paperwork burden for doctors, and technological advances meant more time was required for advanced study just to keep up.

When health maintenance organizations and prepaid health plans came to Vermont with the management expertise to handle administrative detail and the financial backing to hire medical staff as employees, many medical practitioners leapt at the chance to leave the paperwork behind and get back to what they had studied to do practice medicine. Many of these were hired by CHP (Community Health Plan), which opened its doors in Burlington in the 1980s and was eventually bought by California HMO giant Kaiser Permanente.

When Kaiser opted to pull out of Vermont at the end of 1999, things changed dramatically for its physicians around the state. The former Kaiser sites decided to go private again to run their own shops, but to do it under the aegis of a large partnership. It was a painful step for some of them, says Bob Bycer, recently hired chief operating officer of Primary Care Health Partners (PCHP), which is how the partnership is known. "The question was: What do we become?"

While a number of Kaiser sites decided not to be part of the partnership, a large group decided to stay together. "On Dec. 31, 1999, they were Kaiser, and on Jan. 1, 2000, they were PCHP," says Bycer. "These are doctors who were pretty well kept by a big brother called Kaiser. Now, they've become more entrepreneurial."

PCHP tried several arrangements before settling on its current iteration. Because there are affiliates in two states, two partnerships were created.

A management services operation (MSO) sits over the partnerships. The MSO helps the groups do contracting, financial reporting and human resources. The doctors knew they were weak on administrative functions, and the thought was to contract out the billing to another organization; but the arrangement wasn't working up to expectations.

"They decided to acquire the service and manage it themselves," says Bycer. They bought the contractor and equipment and, to some degree, hired their staff. In doing that, the MSO and CBO (central business office) were created."

When PCHP bought the billing service, Steve Greenwell, a physician, was CEO. "He was very instrumental in the transition, but he had indicated he was going to pursue other career alternatives," Bycer says.

Realizing that running the management operation required sharp business skills, the PCHP leadership opted to change from having a chief executive officer to a chief operating officer and hire someone with a business background. "Right or wrong, they picked me," Bycer quips. He started in October of 2001 and works out of an office on Pine Haven Shore Road in Shelburne.

There are currently eight partners, all but two in Vermont, making PCHP the largest primary care group in the state. Vermont partners are: St. Albans Primary Care, Burlington Primary Care, TimberLane Pediatrics in South Burlington, Rutland Primary Care, Brattleboro Primary Care and Mount Anthony Primary Care in Bennington. New York partners are Plattsburgh Primary Care and Village Primary Care in Hoosick Falls.

Bycer works closely with the executive committee, which acts as the board. On the executive committee sit a New York partner, a Vermont partner, a chairperson elected by the board (currently Toby Sadkin of St. Albans Primary Care), and an outside activity member of the board who's not a physician and not a part of the organization (David Coates of KPMG in Burlington). Bycer reports to the chairwoman.

Toby Sadkin, physician manager at St. Albans Primary Care, is PCHP's board chairwoman.

Bycer brings a wealth of experience to the position. "I have probably been in what I'll call physician or group practice management in excess of 25 years," he says.

That's putting it mildly. After earning a bachelor's in business administration from Drexel University in Philadelphia, where he grew up, and a master's in health care administration and finance from Adelphi University in Garden City, N.Y., Bycer returned to Philadelphia as business manager for a department of medicine at Temple University School of Medicine. From there, he went to a skilled nursing facility associated with Long Island Jewish Hospital in New York as assistant controller. Next, he moved across the bridge to the Bronx and was an administrator for OB/GYN at the Albert Einstein College of Medicine.

"Then began my pilgrimage," he says with a chuckle. He went to the University of Florida in Gainesville where he was associate director of finance planning, then to the University of Washington in Seattle as executive director for Children's University Medical Group.

Bycer liked Seattle, but when he had an opportunity to "be in charge of the whole big practice rather than a subset," he went to the University of Arkansas Medical College Physicians Group. "I probably should have stayed in Arkansas," he says, warming to his subject, but I went to George Washington Medical Center in D.C. and was the chief operating officer for Medical Faculty Associates," a physician practice. "And I heard about this place called Fletcher Allen Health Care and this place called Vermont."

Bycer worked at Fletcher Allen eight months as vice president of medical group administration. "I think both parties agreed they had a different set of situations, and we parted on a friendly basis."

After a four-month project in Portland, Maine, where he "learned a lot about private practice," he began working with a group in January of 2001 that provided practice management and billing services to a New York City-area client base with an operations center in Florida. He agreed to work with them on the condition that he not have to move. "I love living in Vermont."

They agreed, and things were going well until Sept. 11 put his flight-commuting plans into disarray. "I was flying back and forth from New York and Florida, and along came this opportunity to stay home in Vermont and work with these doctors here."

PCHP is in a good position to continue its growth pattern. Each group has an on-site physician-manager, and Bycer visits them on a regular basis. PCHP is signed up with nearly 50 health plans and appears to have a solid administrative staff in place.

"Look at us now," Bycer says, quoting one of the doctors at a recent meeting. "We're successful and ready to establish our business processes and grow."

Growth is definitely in the plan. PCHP wants to become multi-tiered. "I think of three tiers. It wants to be the key regional primary-care provider in this area. We cover the whole state. And they're extraordinarily good clinicians.

"Second, we want to have very good business processes. That's why I was hired.

"The third thing is, once we get these things better the MSO and billing tightened up we'd like to be good enough that other practices would say, 'I'd like to utilize your expertise in management or billing.'

"Maybe we could create a cafeteria model that says, 'Here's a list of services I provide. What would you want?'"

Here's what some of the partners say.

Burlington Primary Care

Rob Penney is the physician-manager at Burlington Primary Care at 789 Pine St., the original site of Burlington's CHP office. Penney and two other physicians own the practice and, with one other individual, own the building. A number of other health-related businesses rent space there: a Kinney's Pharmacy, First Advantage Dental Office, Long Trail Physical Therapy and Otter Creek Matrix, a mental health group. Working with Penney and the other two physicians are four nurses and five support staffers.

"Of course, the big difference is that now we are in private practice, whereas we were employed by Kaiser and, before that, CHP," says Penney. "Having to learn the business ourselves can be quite time-consuming. It does help having functions centralized."

One of the biggest differences about the way he works now vs., say, five years ago is that he has to spend more time worrying about the business and less time on medical practice.

Penney says one of the big challenges is trying not to lose that focus on individual, quality care, which CHP and Kaiser brought to health care here, while trying to stay in business.

Burlington Primary Care's physician manager, Rob Penney, finds it a big advantage to be part of a group like PCHP "sort of a brain pool," he calls it.

"And, of course, medicine changes a bit every year." He adds, for example, that last year, he didn't have to worry about bioterrorism.

Most exciting about the future is continuing to meet the challenge of the ongoing transition. "It's a big advantage, being a group, sort of a brain pool. And if somebody finds something that works, they can spread it around.

"We are the biggest single primary care group in the state. Where that'll take us, I'm not sure. It does offer some attractive options to some insurers who like to cover a large area with physicians. That was part of our original concept in staying together."

TimberLane Pediatrics

Marc Starer is TimberLane's physician-manager. Founded 35 years ago, TimberLane is in a South Burlington medical condominium complex that houses specialists and subspecialists. Starer joined the practice in 1972. As part of the overall group, there's also a department called Beginnings, a parent education group. It conducts prenatal education, CPR classes and a variety of parent education features.

About a year ago, TimberLane opened a satellite office on North Avenue in Burlington. This makes it convenient for patients who prefer not to travel across town, says Starer, and to serve outlying areas such as Colchester.

"It's a one-doc office out of the North End. We have as many as five docs in the South Burlington office."

In addition to TimberLane's six pediatricians, there are about 25 staff members including nurses, medical technicians and business office personnel. The South Burlington site has about 5,000 square feet, and there's 1,500 square feet of space in the North End office.

As for working with PCHP as opposed to Kaiser, Starer quips, "It's kind of like blue jeans and bell bottoms, old again and new again. We certainly learned a lot from our experience with CHP and Kaiser. Their strong points were quality improvement projects, and we learned how to document our quality and improve basic care.

"Independence that comes from being in private practice is something that we enjoy having back, and being part of a larger medical group at the same time allows us to work from a position of strength.

It's really a benefit to be back in a more local sort of setting where we can make some of the decisions locally."

Starer says working with Kaiser Permanente had its benefits, however. "When we were with CHP and Kaiser, to a certain extent, we were shielded from a lot of the insurance negotiations. Those could happen on a global level negotiating contracts or when you're trying to advocate for a patient to get what they need. Now that we're in private practice, we have to negotiate and work with private patients to see that they get what's medically necessary. It's tougher. You spend more time above and beyond the medical practice, and it makes each day a little bit longer, but if you can help the patients out, it's worth it."

Starer is looking forward to the revamping of the pediatrics department and in-service at Fletcher Allen Health Care. "All of us in town are looking forward to that," he says.

The other exciting thing, "to us as a medical group is being able to act together to improve on the quality of care we bring to the patients. Then there's HIPPA (Health Insurance Privacy and Portability Act). In a larger group setting, we'll be able to respond best to that new regulation dealing with the privacy of patient records and confidentiality issues.

The big issue, though, says Starer, is the chance to be players. "Our group has the responsibility of currently serving over 70,000 Vermonters. So for our part, we feel we are an important part of primary health care in Vermont.

"It's kind of like blue jeans and bell bottoms, old again and new again." That's how TimberLane Pediatrics' physician manager Marc Starer describes the evolution of the practice.

There may be people calling us for opinions on health care in Vermont, discussions on funding for patients for care and quality in the state. While those are ultimately the decision of the policy makers, we're a large enough group, as we grow in size and influence, to hopefully participate in the discussion as well.

St. Albans Primary Care

When Community Health Plan hired Toby Sadkin, now the physician-manager of St. Albans Primary Care, she was only a year out of residency at the University of Vermont. Things have changed dramatically for her and the practice since that time in 1992.

"I started it alone," she says. "I was in a tiny little one-room office where the old hospital is for two years. Now, we're in this place which is nice and modern and big, and it's a really nice practice.

St. Albans is a family practice with three full-time family physicians, a full-time physician's assistant and 16 staff, including the office manager. It's reminiscent of the old-time family practice, in that the doctors cover obstretics, they deliver babies, do some surgical assisting and some office procedures, such as suturing, splinting and casting, says Sadkin. "We're open many hours four evenings a week until 8 and on Saturday afternoons so we try to be really available for the people."

Sadkin admits it's been a big change. "For some of us, working for someone else was our whole lives," she says. "Some people in the group had come from private practice and for some reason, that wasn't for them, so they joined up with CHP. For me, it's the opposite. When I started off, I always had people do things for me and thought that was a good idea. But as time goes on, you get the feeling you want a lot more control." She says that, even for the few years leading up to the break with Kaiser, she thinks she was preparing for something independent, however that shaped up.

"I like the idea of what we're doing right now. It's a physician-run group. Now, we're not working for an insurance company, an administrator or a hospital. It's a group of physicians with the patient in mind." Sadkin has gone into this full-force. She personally owns the condominium building at Doctors Office Common that houses the practice, and she is the board chairwoman of PCHP.

"A lot of people still think of us as the old CHP or the old Kaiser," says Sadkin. "There was a time when some people left our offices because they changed insurances, but now people who thought they couldn't come back can come back. We can take anybody. We do say to people who come in, if they do not have coverage or cannot afford it, we'll have them sit down with the office manager to really come up with a payment plan."

Rutland Primary Care

Rich Baker is Rutland's physician-manager, one of three doctors on staff, and Rick Anair manages the office. There are 25 employees in the approximately 8,000-square-foot space. The providers own the building (16,000 square feet total) and lease out the remaining part to four other tenants: Champlain Valley Cardiology, Rutland Regional Medical Center's billing department and two mental health providers.

Baker says about working with PCHP, "It's a whole different thing, and we're kind of making up the rules as we go along. It used to be a very top-down, almost military organization. Now we're more of a confederacy and use the central administration for what we need them for. Other than that, we're fairly independent."

Having said that, Baker acknowledges that medicine is still fairly much the same. "What's changed for us is not being employees any more; getting those bills out accurately; and insurance companies. It's become much more difficult to get them to pay. You have to keep after them," he says.

Rutland Primary Care is learning to be flexible and seems to have taken well to the entrepreneurial spirit. "Right now, we have 20 to 25 companies that utilize us for Worker's Compensation, drug screenings, etc., and we're going out into the community doing flu clinics, hepatitis clinics, right at people's offices.

Thirty-five years ago, TimberLane Pediatrics started life as a private practice, then evolved through ownership by CHP and Kaiser Permanente days and has come full-circle to private practice as part of PCHP. "We just finished a flu clinic at GE and had some of our people go onsite there and give flu shots to over 50 of their employees," says Anair. "We're able to customize it the way the employer wants it and charge less than the hospital and the visiting nurses."

Rutland has established a walk-in service so patients can "get their health care when they want it," says Baker. "We're open every evening until 9 o'clock in addition to Saturdays. We feel that the key to success is being more accessible to patients and being willing to do things that a lot of the smaller offices aren't willing to do."

Baker sees a day in the not too distant future when all practices will become more customer-service oriented. "Those who make those changes will probably be more successful than those who don't." •

Originally published in January 2002 Business People-Vermont