Penrose-St. Francis Health Services entered into its fourth Professional Services Agreement last week after inking a deal with Front Range Orthopaedics. The agreement was effective April 1 and the terms of the PSA included the purchase of Front Range Orthopaedics’ assets by Centura Health.
Those assets, as determined by an out-of-state third-party assessor, came in at around $1 million, according to Jamie Smith, senior vice president and chief administrative officer with Penrose-St. Francis Health Services.
“[Penrose-St. Francis Health Service is] employing all the people and will run the practice, but it’s contracting with [Front Range Orthopaedics’] physician group for their professional services,” Smith said. “We will [lead] practice operations on the Centura side and Front Range Orthopaedics group will remain its own entity, providing us with the professional services of its physicians.”
Smith said the agreement will be mutually beneficial.
“We had truly deep discussions about the future, the benefits, costs, fears and opportunities of each side. We’re both committed to a new future.”
– Jamie Smith
[/pullquote]“For us, we’re aligning with a great group … that provides comprehensive orthopedic services with an existing practice. We don’t have to bring it in and build it on our own. They have a reputation in town that’s very good and an existing patient base and referral services,” Smith said. “For them, we’re taking over and running the business side and they are able to relieve themselves of that headache and focus on medicine. They’ve done a good job running their own business, but [health care is] getting complicated. Reimbursements are going down and it’s getting more challenging for private practices to make it on their own.”
According to Dan Karpel, former Front Range Orthopaedics CEO and new administrative director of the orthopedic service line for Penrose-St. Francis, the PSA bolsters the systems’ orthopedic care capabilities.
“Penrose gets a group of highly respected and skilled surgeons that have been one of the premier groups in Colorado Springs for close to 40 years,” Karpel said. “The [Penrose-St.Francis] Health System wants to talk about physician-driven business models and this proves that Centura is up to that task. And we’re certainly up to it and looking forward to it.”
Smith said the entire Front Range Orthopaedics staff had the opportunity to continue in their positions under the agreement and most did, adding the PSA should create more job opportunities and lead to additional locations.
“We didn’t cut any positions and will probably hire more people. I think it’s a great recruiting platform and we will be able to add physicians to it,” Smith said, explaining an additional five to eight doctors could be added over the next two to three years.
Three years ago Penrose-St. Francis Health Services entered into its first PSA with Colorado Springs Cardiology, and has similar arrangements within the fields of thoracic and oncological surgery.
Regarding the arrangement with Front Range Orthopaedics, Smith said the group was “very strategic. It took a lot for them to be willing to sacrifice some of their historical control and see the future from the physician side. I give them a lot of kudos. … We had truly deep discussions about the future, the benefits, costs, fears and opportunities of each side. We’re both committed to a new future.”
Partnership includes new Colorado Springs soccer team
Penrose-St. Francis Health Services and Front Range Orthopaedics, a Centura Health Clinic, have aligned with the Colorado Springs’ Switchbacks FC as the official hospital and orthopedic partner of the soccer team.
The partnership will provide the Switchbacks FC with an athletic trainer as well as a team of orthopedic physicians.
“Penrose-St. Francis Health Services has been a visionary partner from the beginning, believing in our organization before we even had a name,” said Switchbacks’ President Nick Ragain. “Front Range Orthopaedics has been instrumental in keeping our players fresh and healthy to compete at the highest level. Altogether we could not ask for better health partners.”
The Switchbacks FC is the first and only professional men’s soccer club in southern Colorado. The expansion franchise was awarded to Ragain Sports in December 2013 and the team is playing in its inaugural season in the United Soccer League. The Switchbacks join 23 other clubs in the league and are part of the USL’s Western Conference.