From Dermatology to Plastics: Strategic Expansion Insights 

A prominent dermatology practice was preparing for expansion, and there was a desire to purchase an established plastic surgery practice. This strategic expansion included traditional clinic settings for patient care (medical and cosmetic dermatology) and an office-based surgical (OBS) setting.  

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Situation

With a history rooted in medical and cosmetic dermatology services, the group practice was eyeing an expansion into surgical procedures. They considered establishing a state-licensed and accredited OBS center specializing in plastic surgery. To ensure a sound decision, the group engaged BSM Consulting (BSM) and Progressive Surgical Solutions (PSS), two professional services firms under the VMG Health umbrella with a wealth of expertise in the healthcare industry, to conduct comprehensive due diligence. This process was designed to assess the feasibility of the new venture and identify any potential risks involved in the transaction, providing the group with high-quality advice. 

Solution

BSM and PSS’ Senior Consultant team guided the practice through the complexities of regulatory compliance in an OBS environment. Before the on-site assessment, the team conducted a remote documentation review to familiarize themselves with the facility’s unique operations and regulatory compliance status. To maximize the impact and efficiency of the on-site assessment, the PSS consultant thoroughly reviewed previous state and accrediting organization survey results and critical governance documents. The on-site mock survey for state licensure and accreditation standards, alongside a billing and coding compliance audit by the BSM consultant, was conducted to determine areas of deviation from regulatory and accreditation standards and best practices. The client received preliminary feedback concerning the findings of the on-site assessment within 24 hours of the consultants’ departure, demonstrating the efficiency of the service and respecting the client's timeline, followed by a comprehensive written report.  

Success

The BSM/PSS team’s due diligence report was a comprehensive document that included a short narrative of the overall impression of the center and an extensive list of known deficiencies that would result in regulatory body citation, potential solutions or plans of correction, and an associated cost to rectify the issue. The client also discussed the report with the consultants to expand on the findings and considerations regarding the buyer’s perspective. Further, PSS created a comprehensive facility program that is fully customized to the center and aligned with the most recent regulations to ensure the buyer’s future success in this highly regulated environment. This policy and procedure set provides a critical framework for administration, provider credentialing and privileging, human resources, quality assurance, infection prevention, and control.  

Meanwhile, BSM’s Billing, Coding, and Compliance team’s audit revealed missed revenue opportunities and deviations from best practices that, when corrected, will improve the center’s bottom line. With this information, the dermatology practice made an informed decision about its first OBS purchase. This transaction sets the stage for the group practice's successful expansion into the plastic surgery space.