Market Profile of U.S. Orthopedic Surgeons · tumors, and cerebral palsy. An orthopedic surgeon may complete additional training with a spine fellowship and specialize in spine surgery

MARKETINSIGHTS

Market Profile of U.S. Orthopedic SurgeonsMarket Insights Report

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For more information about this report, please contact:Jack Schember, Director of Marketing, email: [email protected] phone: 949-476-2051 x 1259

Overview: Profile of U.S. Orthopedic SurgeonsOrthopedic Surgeons by Number, Region and Move Rate 1

Practice Size and Patient Volume 3

Ownership, Affiliations and Specialty Associations 4

Affiliations to Hospitals for Admitting Privileges 5

Government Insurance Acceptance 5

IHS Employment and ACO Participation 6

Physician Access and Drug Sample Acceptance Rates 7

Electronic Health Records Adoption Rate 8

Annual Compensation of Orthopedic Surgeons 8

Promotional Spend Towards Orthopedic Surgeons Q4 2014 - Q3 2015Channel Mix - Details, Samples and Meetings 9

Total Product Details 9

Market Profile of U.S. Orthopedic Surgeons



1

5k

0

10k

15k

20k

25k

30k

35k

40k

201520142013201220112010

35,74236,11535,17734,16532,80234,372 35,74236,11535,17734,16532,80234,372

Source: SK&A, Dec 2015

Number of Orthopedic Surgeons in the U.S.

Introduction An orthopedic surgeon has been educated and trained in the diagnosis and treatment of diseases and injuries of the musculoskeletal system. An orthopedic surgeon is either a medical doctor or a DO who has completed a five-year residency focused on surgical treatment.

The most common treatment areas are spinal disorders, arthritis, sports injuries, trauma, fractures, bone tumors, and cerebral palsy. An orthopedic surgeon may complete additional training with a spine fellowship and specialize in spine surgery.

Orthopedic surgeons work closely with other healthcare providers and often serve as consultants to other physicians. They may practice in an orthopedic or multispecialty group, in a solo practice, or as a hospital system employee.

Orthopedic surgeons are key targets for the medical device and diagnostics industry; but they are difficult to pin down. Engagements and details are difficult, owing to the surgeons’ frequent movement from offices to hospitals to surgery centers.

Orthopedic Surgeons by Number, Region and Move Rate The number of orthopedic surgeons in the U.S. dipped slightly in 2015 after four years of sustained growth. Today there are about 35,742 physicians who named orthopedic surgery as their primary or secondary specialty. They are very likely (60%) to have a secondary specialty. Of the top 20 physician specialties by number of practitioners, orthopedics ranked seventh, just behind cardiovascular surgeons. They practice at 11,552 medical sites.



2

20152014201320122011201020092008

5%

0%

10%

15%

20% 18.2%

15.0%

12.4%

11.8% 12.1%

14.5%

12.4%12.0%

18.2%

15.0%

12.4%

11.8% 12.1%

14.5%

12.4%12.0%

13.4%12.3% 12.0%

11.9%13.4%

13.6%

15.6% 15.4%

13.4%12.3% 12.0%

11.9%13.4%

13.6%

15.6% 15.4%

All PhysiciansOrthopedic Surgeons


Orthopedic Surgeons Move Rate(deceased, moved, retired)

The southern states have the highest concentration of orthopedics. One-third of the country’s orthopedics are located in the south. But as a percent of population, the northern states have the highest number of practitioners.

Orthopedics moved to new locations, took new jobs, retired, passed away or made other professional changes at an average rate of 13.45% annually over the past 6 years, a number consistent with the average physician move rate of 13.55%. Orthopedics are trending towards job stability.

8,8147,502

11,177

8,249

West includes AK & HI


U.S. Orthopedic Surgeons by Region



3

Practice Size and Patient Volume Orthopedic surgeons tend to favor mid-size practice settings. Nearly half (47.5%) prefer to practice in locations where there are between 3 and 10 physicians. Conversely, about 30% pull towards the largest of the large practices with 11 doctors and beyond. Three physicians practicing together as a business meet SK&A’s definition of a medical group.

1

No. of Doctors Per Office

2

3 to 5

6 to 10

11 to 25

26 plus

7.1%

23.6%

25.5%

22.0%

8.7%

13.1%

Office Size of Orthopedic Surgeons

1 2 3-5 6-10 11-25 26+ Total

4,676 3,098 7,878 9,100 8,450 2,541 35,742


1 to 50

51 to 75

76 to 100

101 plus

32.6%

16.9%

6,02311.2%

39.3% 11,66114,044

4,014


Daily Patient Volume

Orthopedic specialty offices are quite busy when it comes to patient visits and consultations. The pie chart below represents patient visits per practice location. Most practices (39.3%) see at least up to 50 patients per day.



4

500

0

1000

1500

2000

2500

3000

3500

Physical Medicine/Rehab Specialist

Podiatrist Family Practitioner

Internist

3,482

2,976

1,929 1,758

3,482

2,976

1,929 1,758


Top 4 Specialty Associations

Ownership and Specialty AssociationsOrthopedic surgeons maintain a low level of independence compared to other specialties. Just 25% designated themselves to be independent or solo practitioners. About 56% said they are tied to either hospitals or health systems. In our survey, about 19% did not indicate their ownership status.

Orthopedics are closely aligned with other practitioners in their office setting. About 3,500 orthopedics indicated they are most associated with internists, which is not surprising considering the invasiveness of many orthopedic surgeries. Physical medicine and rehabilitation specialists also are common partners with orthopedics.

Health System Owned29.7%

Hospital Owned26.1%

Independent25.0%


59.4%Yes

40.6%No

Have a secondary specialty?



5

0% 20% 40% 60% 80% 100%

Medicaid

Medicare

Orthopedic Surgeons All Physicians

92.7%

84.3%

66.1%

66.3%


Medicare & Medicaid Aceptance

Affiliation to Hospitals for Admitting PrivilegesNearly 10% of orthopedics have no affiliation to hospitals, presumably conducting their operations and treatments solely in outpatient surgery centers. The trend towards outpatient service is gaining favor. About 40% of orthopedics are affiliated to just one hospital, while 50% are affiliated to two or more.

Affiliation to Hospitals No. of Doctors % of Total

0 3,418 9.6%

1 14,256 39.9%

2 12,054 33.7%

3 4,254 11.9%

4 1,760 4.9%


Government Insurance AcceptanceOwing to the high cost of their complex treatments and rehabilitation, orthopedic surgeons are more likely to accept government insurance plans and navigate reimbursement than the average physician. Nearly 93% will accept Medicare and 66%, Medicaid.



6

New York-PresbyterianHealthcare System

Community HealthSystem Inc

Cleveland ClinicHealth System

Partners Healthcare System

Kaiser Permanente 331

165

157

139

130


Top 5 IHS Employing Orthopedic Surgeons

Cleveland Clinic Cigna ACO

WellStar Health Network

Advantage Health Network &Florida Blue Cross Blue Shield

Montefiore Accountable CareOrganization & United HealthCare

Frederick Integrated Healthcare Network ACO 199

162

160

146

145


Top 5 ACOs with Orthopedic Surgeon Participation

29.1%Yes

70.9%No

Percent OrthosPart of IHS

23.4%Yes

76.6%No

Percent OrthosPart of ACO

IHS Employment and ACO ParticipationEmploying more than 7,900 MDs and DOs in 800-plus medical offices, Kaiser Permanente is the largest employer of health professionals among integrated health systems. Kaiser hires the most number of orthopedics, double the number of the next top employer. Most orthopedics, however, remain independent.

At least 23% of orthopedics are participating in accountable care organizations (ACOs). While newcomer Frederick in Maryland is not one of the largest ACOs in terms of total physician enrollment, it has the highest number of orthopedics in its network.



7

Physician Access and Drug Sample Acceptance RatesOrthopedics are somewhat restrictive when it comes to details from sales representatives. One-quarter (25.5%) flat out will not meet with a rep. Another 55.2 % will see a rep but require an appointment up front. About 16% allow walk-ins any time.

Mail

Drug rep drops off drugs

Both

No preference or unknown

3.8%

34.8%

13.9%

47.5%


Drug Sampling Preference

Access any time

Call for appointment

No access

Unknown

3.5%

25.5%

15.8%

55.2%


Physician Access

In terms of sampling preferences, 14% expect a direct drop-off at their office, while close to half will accept either a drop-off or mail delivery. With their busy surgery schedule, it’s hard to pin down an orthopedic for an interaction or sample signature.



8

0%

10%

20%

30%

40%

50%

60%

70%

80%

20152014201320122011

19,284 21,12924,166 25,709 24,954

58.8% 62.0%68.7% 71.2% 69.8%


EHR Adoption Rate

Electronic Health Record Adoption of Orthopedic SurgeonsOrthopedics’ adoption rate growth over the past three years has remained flat at an average of 70%. Even so, they remain ahead of other physicians in terms of software usage and office automation.

Annual Compensation or Orthopedic SurgeonsAcross the seven workplace types, orthopedics earn an average of $400,000 per annum, making them among the very highest paid surgeons. Solo practitioners earn the least, understandably, but those employed in healthcare organizations are bested by multispecialty group doctors.

Compensation by Practice Setting

Multispecialty Group Practice $459,000

Healthcare Organization $449,000

Single Specialty Group Practice $442,000

Hospital $397,000

Outpatient Clinic $388,000

Solo Practice $348,000

Academic, research, military $319,000

Source: Medscape’s Orthopedics Compensation Report 2014



9

Samples

Meetings

Mailings

Detailing

0

$1M

$2M

$3M

$4M

Q3 2015Q2 2015Q1 2015Q4 2014

Source: IMS Health ChannelDynamicsTM, Dec 2015

Promotional Spend to Orthopedic Surgeons, by Channel

Promotional Spend Q4 2015 to Q3 2015 Channel Mix and Detail SummaryOrthopedics are sought-after targets for medical device and diagnostics providers. The industry’s preference is to detail the surgeons, but they also invest heavily in sponsored meetings and curricula and some direct mailings. Compared to the pharmaceutical industry, promotional spending and activity from the med-device manufacturers is minor. In a rolling annual forecast provided by IMS Health ChannelDynamicsTM, about 80,400 details or engagements were performed on orthopedic surgeons, with the second quarter of 2015 being the most voluminous period. The panel reported on the promotional activity of 38 manufacturers.

Source: IMS Health ChannelDynamicsTM, Dec 2015

14,514

18,552

26,816

20,528

14,514

18,552

26,816

20,528

Q3 2015Q2 2015Q1 2015Q4 20140

5k

10k

15k

20k

25k

30k

Total Product Details(in units)

Documents

Market Profile of U.S. Orthopedic Surgeons · tumors, and cerebral palsy. An orthopedic surgeon may complete additional training with a spine fellowship and specialize in spine surgery