From Due Diligence to Delivery: Physician Practice Operations Moves That Drive Financial Health

Your private equity firm closed the deal, and your due diligence team did a great job evaluating the financials of your new physician practice portfolio.

Now the true challenge begins: Translating financial forecasts into operational realities that improve patient care and ensure that the practices in your portfolio thrive.

If you are a private equity manager tasked with improving operations, boosting the quality of patient care, and growing revenue for a new physician practice portfolio, consider these tried-and-true moves as you build the strategy and tactics that will make you a star in your firm.

Due Diligence Often Overlooks Key Revenue Growth Drivers

Due diligence typically focuses on financial statements. This approach evaluates the bottom line but tells only part of the story. Critical operational details that can make or break a physician portfolio’s success often fall through the cracks during initial assessments.

You can be pretty sure your firm’s due diligence team hasn’t dug deeply into operations nuances like less-than-optimal continuity of care, inefficiencies in patient scheduling, underperforming locations, under-scheduled providers, or the opportunity cost of outdated technology. That’s where you come in. 

Your First Early Wins Are Right Under Your Nose

In a typical physician practice portfolio, 25-40% of patients are overdue for care. These patients may have missed their follow-ups or become inactive due to life changes. Patient reactivation, which systematically identifies and reaches out to overdue patients through automated reminders and personalized communications, can spur patients to return to the practice for treatments, check-ups, or elective procedures that are essential to continuity of their care.

As a portfolio manager, you can improve quality of care immediately if you bring overdue patients back in for care. To reactivate patients efficiently and effectively, you must surmount a few obstacles that just about anyone working with a newly assembled physician practice portfolio will recognize.

Challenge: Your PM/EHR Software Doesn’t Reactivate Patients Effectively

Practice management (PM) and electronic health record (EHR) software may have a few patient recall features, but they aren’t designed for true patient reactivation because they lack powerful datamining, targeting, and analytics. As a result, maxed out staff must identify and try to reactivate patients using very basic approaches.

Whether your integration strategy is to consolidate all your acquisitions to the same PM/EHR or to let practices stay on their legacy systems, Brevium has reactivation solutions that will work for you.

If your portfolio, like 80% of our private equity clients, has chosen to consolidate to one PM/EHR system, you can rely on BreviumStitch. That’s just what Chief Marketing & Growth Officer Laura Fink did when she was tasked with reactivating patients for Schweiger Dermatology Group (SDG), a portfolio spanning 120 locations and 400 providers. From going live in July 2022 to January 2024, SDG contacted over more than half a million unique patients, with nearly 100,000 returning for an office visit.

If your portfolio decides to let practices keep the PMs/EHRs they have become accustomed to, you don’t have to sacrifice your patient reactivation strategy. Chief Operations Officer Grizelda Altamirano successfully deployed Brevium with several PMs/EHRs to reactivate patients for a newly merged dermatology portfolio containing 19 brands and 170 physicians practicing across more than 100 locations. In just six months, the data mining and reengagement effort yielded $3 million revenue the practice would not have earned otherwise.

Challenge: Practice Staff Don’t Have Bandwidth for New Initiatives

Given widespread staff shortages in healthcare, you can be almost certain that staff at the practices in your portfolio are fully loaded. Their time and energy for supporting portfolio-driven initiatives is limited.

Physician practice portfolio leaders looking to reactivate thousands of overdue patients missing from multiple practices across their portfolios need simple solutions that don’t consume staff time. They must be sophisticated enough to engage the right patients with the right messages at the right times.

Solution: Manage Automated Reactivations from One Central System

“We needed an automated solution that could integrate seamlessly with our EHR so that we could reactivate patients at scale,” says Laura Fink of SDG.

“In just 12 weeks, the Brevium team set up a re-engagement system for us that generated value over the next 12 months,” Fink says. “We were able to dramatically improve patient adherence and continuity of care without taking away from staff bandwidth we needed for day-to-day operations.”

Operational Improvements Support Organic Growth

Key takeaway from 2024’s Healthcare Private Equity and Finance (HCPE) conference: High interest rates make the cost of borrowing capital high — driving organic growth is crucial.

Some organic growth drivers, like negotiating more favorable terms with payers or adding ancillary services, take time — no matter how efficiently you and your staff move. In the meantime, an efficient and effective patient recall solution can raise the revenue you need now and over the initial year after a merger. An optimal patient re-engagement strategy also supports practice success over the long term. Patient adherence and continuity of care is in the patient’s best interest. What is best for patient care is also what is best for the practice.