THE ORIGINAL POST: (dated 6-29-00)
Hello List members:
My company is an OPNET member. When Hanger purchased Novacare, we suddenly
had competition for the OPNET referrals in our area. (OPNET claims that
referrals are made strickly by which facility is closest)
If you are a private, “non-chain” facility that has been with OPNET, has
this affected you? Can the OPNET dues be justified by the sales generated?
How crucial have such contracts been for you….. have you found success
in negotiating directly with health plans? Which plans
have been good for your practice?
Randy McFarland, CPO
single facility owner
Sunny Hills Orthopedic Services, Inc.
www.sunnyhills.com
THE RESPONSES: Each is separated by a blank line.
I can’t dermine the accuracy of the following responses:
>From Ohio:
Hanger has “satellite” offices open only a few days/ week which allows
OPNET to refer to those offices rather than “non-Hanger” offices.
>From Florida:
I thought as an opnet member you are give a protective area, in miles,
that no other member can have a presence in. If this has changed I would say
the cost of being a member needs to be evaluated.
>From Florida:
I managed a NovaCare office that competed with a non Hanger/non NovaCare
office with an OPnet contract. After becoming Hanger, I was told by OPNET
that they do not refer patients at all. This proved to be a lie. I found
that they did send a volume of business to this non-company facility.
Why did they send the business to this other facility? I have no idea.
But, understand that they may say they do one thing and actually do
another.
>From California:
Our experience w/ OPNET is as follows:
The referrals pre-merge were never able to justify the dues. I calculated
the discount rate including dues, and we were doing OPNET WORK at less than
half of Medi-care rates. When I determined the effect of their poor
contracts coupled with the high membership rate I stopped paying my dues. At
that point, we renegotiated
the dues to a percentage of the previous amount. This still didn’t really
justify the small amount of referrals, but we considered our membership
as a somewhat “defensive” position.
Post merge we haven’t seen much change, with neither an increase or
decrease in the meager referral pattern.
I was in Bethesda and had the chance to review their operations.
I don’t believe they have the ability “cherry pick” the referrals, and send
the good ones to themselves. When given a zip code all members regardless of
ownership
show up the same. Doesn’t mean that they couldn’t have been deceiving
me or have changed practices since then but it seemed fair at the time.
Currently OPNET is sending out new contracts, as the current ones come
up to their renewal dates. What little protection you had prior to the
merge will be diminished with the new contracts. They will be able to
open new offices or acquire your competition at will.
At this point OPNET no longer needs us and the impression I got is they
would prefer we all just go away. We are complicating their lives
through the expense of maintaining the organization, and through legal
issues involved with the arrangements. I believe their goal is to make
continued membership distasteful and cost prohibitive so we will all
make a “business decision” and quit on our own volition.
>From Florida:
I am not in your position, but I know of those who are. I feel that OPNET is
in breech of contract. They promised you no Hanger shop in your area if you
signed on with OPNET. Screw the discount or referrals, you and every one else
bought to keep Hanger at bay. Well they took your money and now they are
going to take it again with your business. Sue them don’t let them have their
cake and eat it too!
From: Florida: Confirm percentages can be stated FIRST
About 5 years ago, I was the O&P advisor for a work. comp. company called
P.M.S.I. We referred cases to O&P facilities all over the country. Jeff
Martin gave us an in-service and we began making most of our referrals thru
OPNET, rather than using the ABC & AOPA directories. At that time, the
contact at
OPNET would make a sincere effort to refer to the closest facility, showing
no bias toward independents over Hanger or Hanger owned facilities.
Problem was, we thought the referrals were going to independents when in
fact, they were referring to Hanger owned facilities that retained their old
name. I have talked with many, many independent since then, and all, without
exception, felt they paid more money for the OPNET network then they got
back in referrals.
I have talked to Jeff Martin several times, and he has always maintained
his
people show no preference toward a Hanger, Hanger owned, or Novacare
facility. That may have been true at one time. But now, many things have
changed at Hanger Orthopedic Group (HOG, as I love to call it). Facility
managers are now asked to use S.P.S., S.O.G.I., Lenox Hill, D.O.B.I., etc.
whenever possible. And I’m sure Jeff Martin is told to use Hanger owned
facility whenever possible. I’ve known Ivan Sabel for many years. He moves
slowly, but in a straight line. I’m sure he keeps a close eye on the
MicroSoft litigation now going on. He and Dick Stein are the only two left
of the original HOG. There are still employees, but none in high management
positions.
Had some very close friends give up everything to go with Hanger, and all
have been
pushed into the background or dumped completely.
Again, I know of no independent facility that got their moneys’ worth
joining OPNET.
Many independents got referrals from OPNET, but were asked to provide service
well below Medicare allowable. They had the option of turning it down, which
most
did, then the referral was given to a HOG, who would accept the business.
Then Jeff
Martin could say,”Hey, we offered it to the independent first.”
Before they merged, Novacare was worse than Hanger. Novacare would provide
service way below Medicare profile.
From: New York
My company was a member of a network for approx. 5 years. As a member we
benefited because we were able to accept certain insurance companies that we
couldn’t contract with on our own. This was OK as long as our dues/fees
remained low in relation to our receipts. After the network raised the dues
over 250% it just didn’t make economic sense.
In our area, we have had good success negotiating independently with MCO’s.
We just aimed at the organizations that we knew would be good referral
sources; and we did not lowball our suggested fee schedules.
>From California:
There is no question that independent members of OPNET are taking the shaft.
In the beginning, the West Coast got the shaft by having few to no contracts
that were relevant. We all joined on the hope that OPNET would be the only
entity that could compete with the monster Novacare in obtaining contacts.
This never seem to happen. Then, Hangar, took over Novacare. We then hoped
that we would finally see the contracts that would finally benefit the large
amount of money spent. This again never occurred. In fact, I now believe
that it will never occur. With Andy Meyers taking over OPNET and the
financial losses Hangar reported, it is now in the best interest of the
company to get rid of the independents as they are in direct competition with
their facilities. The bottom line is I believe the independents are screwed.
If we complain, it will be to deaf ears as they would like up to drop out.
This will be easier for them than asking us to leave. The cost of OPNET is
too high for the return. This is a benefit to them as a good business
decision would be to leave. Remember, the independents were necessary to
have the FTC approve the idea of OPNET. Now Hangar no longer needs OPNET as
they can run their contract the same as Novacare did. So when we should be
getting the advantage of Hangar buying out Novacare we are getting the shaft.
My OPNET referrals have gone to ZERO and the remaining contracts are not
of much help. If OPNET integrated the Novacare contracts and opened them up
to the independents that have been long time members, it would again be worth
the price. Hangar has no incentive to let this happen. In fact, just the
opposite. Hangar has the incentive to get rid of all of the independents.
It is possible that the independents should be thinking about a class action
suit as Hangar no longer would meet the criteria that would allow OPNET to be
a legal entity.
Also recommend all independents calling Andy Meyers and let him know
there is trouble brewing. This might motivate the board to be more lenient
in their decision of how to disperse the Novacare contracts. Remember, it
has already been a long time since the takeover and we independents have seen
no benefits.
>From California:
OPNET claims to give the patient only the “closest” facility… but what’s
to stop them from giving a “list”, say the closest three facilities in the
area to the patient?
The “renewal” contracts (subsequent to Novacare acquisition) have
eliminated exclusivity wording that prevents preferential treatment to Hanger
facilities.
Those who have serious concerns should consider filing a complaint with
their local Senator. By the way, (E mail address to contact your senator is:
www.senate.gov/contacting/index.cfm)
