The Evolution of Wound Healing Business

  A few weeks ago, February 12, we celebrated the 202nd anniversary of Abraham Lincoln’s birthday. It is also the 202nd anniversary of the birth of Charles Darwin: both were born on the same day in 1809 and both captained an idea through turbulent waters—and won. Stephen J. Gould points out that major evolutionary changes are occasioned by single dramatic events, for example, the Cambrian explosion and the American Civil War. I am not claiming a tectonic shift, but we are on the cusp of an evolutionary leap in our world—a small one—but nonetheless significant. This has special importance for me, having begun my scientific career in evolutionary biology. In my current role as a general surgeon and wound care specialist I have watched the evolution of wound care and hyperbarics with great interest.

  Beginning with Florence Nightingale, care of the wounded was initially under the aegis of nursing. The development of highly specialized modern medicine resulted in the fragmentation of wound healing among numerous clinicians. In the later part of the 20th century the wound care center emerged as a focal point for multidisciplinary specialty wound care. Industry developed advanced products, such as topical growth factors, negative pressure, and bioengineered skin. In 2003 hyperbaric oxygen, an important adjunct to wound healing, received a favorable reimbursement decision. However, there was still a paucity of wound care specialists to develop and staff centers. This niche was filled by management companies offering “turn-key” services: establishing the wound and hyperbaric center providing chambers and capital, assisting with billing, hiring and training nurses and staff, and building the physician panel. These companies filled a vast unmet need and the species flourished. Physicians migrated to wound care from every corner of medicine. The number of turn-key management companies, large and small, exploded.

  Evolution progresses.

  We now have mature wound clinics with experienced, well-educated staff. They have, indeed, been successful—too successful according to some. As the hospitals near the end of their turnkey contracts, they no longer need comprehensive and expensive services.

  Enter the small mammals.

  In this article I want to introduce the concept of transitional medical services (TMS). At the end of a turnkey contract, the majority of hospitals are ready for a change. They could still use assistance with marketing, billing, updated policies and procedures, and ongoing education. However, this service can be provided at a fraction of the cost. A turnkey management contract usually involves a split of the technical reimbursement for hyperbaric and a fee for each wound care patient visit. Transitional management contracts can be obtained for less than a third of the cost of the shared risk contract. For example a TMS package can be provided at roughly the cost of a full time employee (FTE) or 1 ½ FTE. In building a business plan, the overall overhead cost is neutral or marginally positive. (The TMS services provided would require a hospital FTE or more). Most TMS contracts are provided for a fixed fee. The hospital now realizes the full profit of the center. This can represent more than twice the previous net income.

  There are few downsides to TMS contracts. In fact, an underperforming center may respond positively to the enhanced clinical approach that characterizes most TMS agreements. There is also the opportunity to expand clinical services, such as adding a wound specific electronic health record or research protocols.

  Hospital administrators, physicians and nurses nearing the end of a full service contract might profitably investigate transitional medicine services. Clearly, there is an evolutionary plateau at hand: who will advance? The turnkey dinosaurs or the small mammals darting from clinic to clinic in the brave new wound care world?

  Dr. Thomas E. Serena MD FACS FACHM FAPWCA, Founder and Medical Director of The Serena Group™, a family of wound, hyperbaric and research companies, is a Phi Beta Kappa graduate of The College of William and Mary and Penn State Medical School. He completed his residency in surgery at The Milton S. Hershey Medical Center with fellowship training in Plastic and Reconstructive Surgery at Southern Illinois University. To date he has opened and operates wound care centers from New York City to Tulsa Oklahoma. Dr. Serena has been the lead or Principal investigator in over 55 clinical trials, including testing blood platelets, gene therapy for critical limb ischemia, antimicrobial dressings, growth factors, topical and parenteral antibiotics and bi-layered cell therapy. As a result of the overwhelming demand for his services as a researcher, he founded the NewBridge Medical Research Corporation, a non-profit corporation (501(c)3) dedicated to advancing the science of wound healing. On four occasions NewBridge has received funded from the National Institutes of Health. He currently consults for the government of Rwanda on AIDS prevention research. He is recognized internationally as an expert in the field of wound healing: He has 100 published papers and has given more than 200 invited lectures throughout the world. He consults for numerous wound care industrial partners in the development of new products for the wound care space. He has been a member of the Board of Directors of the Wound Healing Society and recently was an author on four of the national guidelines for the treatment of chronic wounds. In 2009 he was elected Vice-President of the American College of Hyperbaric Medicine. He also currently serves on the board for the Association for the Advancement of Wound Care. Recently, Dr. Serena returned from Haiti where he was the wound care team leader for the University of Miami’s Medishare Hospital. He has done extensive medical relief work with Health Volunteers Overseas and serves as chairman of the AAWC Global Volunteers/HVO Steering Committee. He also a member of the World Health Organization’s wound care outreach program (WAWLC).