In late 2018, two general surgeons had their fill of challenges within the hospital system. Scheduling problems, facility weaknesses, growing patient dissatisfaction, and escalating staff disruptions led to more of the procedures they once handled being referred out. It wasn’t only an operational problem but a financial problem as well. Eventually, they branched out, borrowed, and started their own ambulatory surgery center just outside of Denver.

Six months later, their business was booming. They were flush with patients, had a pulsating referral pipeline with no end in sight, and attained income levels they never imagined. But then they discovered that growth, when achieved quickly and without infrastructure or planning, was an entirely new kind of problem. The surgeons became overscheduled, their staff overworked, their patients became annoyed, and their leased facility was beyond its capacity. By the end of 2019, they were facing a drop in revenue. As quickly as they had emerged, their center was now in decline.

After a much-needed weekend off-site with key staff, they were confident they had the right team, relationships, and general location to be massively successful. But what they didn’t have was a plan to scale growth successfully. So, that’s what they went to work on. By year-end 2022, the center had grown by 400% with over 200 employees, 22 partner physicians, and 3 locations.

It was all because of their innovative growth plan. Here’s how they transformed their business:

1. Staff. It all starts with people. Either you have the talent or you don’t, and the surgeons felt their current talent was top-notch. They also thought they had access to a robust pipeline of additional talent and the right compensation structure and environment for success. So, they built a compensation model where everyone, not just partner physicians, benefitted from four core areas: volume, patient satisfaction, employee satisfaction, and profit.
2. Technology. Managing everything from patient throughput to medical records and imaging equipment to surgical equipment that reduced time per procedure was critical to their overall success. They realized that scaling profitably was a function of how effectively they used labor, and there were few better ways to maximize labor output and employee satisfaction than to ensure the center was always on the cutting edge of technology.
3. Facility. Leased property wasn’t going to cut it. They needed their own building on a property that could allow for affordable expansion as the center grew. This was an essential element as new medical procedures could be offered when new staff members were brought in to work in a space dedicated to their specialty. Further, ownership of the building added additional value and net worth to the center for current and future owners.
4. Referral Rewards. They employed staff members to show benefits, event invitations, support, and gratitude for referral activity. It started small and evolved into an annual effort where referral partners could access exciting events and take advantage of numerous incentives for their relationship with the center. This program also became the primary pipeline of staff recruitment.
5. Funding. Funding growth at the scale they envisioned couldn’t be supported with cash. Borrowing became essential, and many lenders were eager to help. But, they found the answer to their borrowing needs in a diversification strategy that was a mix of traditional bank lending and specialty lenders. For example, this plan offered a better way to fund robotic surgery equipment with a lease than even the lowest interest rate loan because the lease aligned payments and use. The funding strategy also preserved cash, provided predictable cash flow streams, and maximized compensation potential.

“It was really a simple plan with common sense elements. We felt by addressing people, technology infrastructure, relationships, and financing, we could solve almost all the core business problems we faced upon starting. No one element could be withdrawn without severely impacting our ability to be successful.”

– CEO and Founder, Rocky Mountain Area ASC

For decades, LEAF has helped healthcare providers with the creative financing to adapt to changing care environments and stay on the cutting edge of technology.