OrthoNOW CFO and Co-Founder, Justin Irizarry, sits down with Jack Sweeney from Middle Market Executive Thought Leaders to discuss the OrthoNOW model and pathway to franchising.
Imagine if your doctor had a heads up on your injury before you pulled into the parking lot? That and more are now available thanks to OrthoNOW and Uber. This new version of their mobile app includes a feature called “On My Way NOW,” that sends alerts about patient arrival at the nearest OrthoNOW location. The app, which is now integrated into the Uber app, is available free of charge in the iPhone App Store.
In the October 26, 2016 news release, co-Founder and Chief Medical Officer, Alejandro Badia, M.D. quotes Steve Jobs, saying “You’ve got to start with the customer experience and work back toward the technology, not the other way around. We understand that injuries don’t happen by appointment and providing an outstanding patient experience begins before patients cross our threshold.”
Uber South Florida General Manager Kasra Moshkani said, “We are excited that OrthoNOW is utilizing Uber’s open API for such an innovative integration.”
The OrthoNOW mobile app allows patients to notify an OrthoNOW Center that they are in route, the reason they are going, and what time they expect to arrive. Additionally, the app locates the nearest OrthoNOW Center, provides contact interface to the Center, can connect to Facebook and Twitter accounts, and supplies information about conditions treated and a section of frequently asked questions…Patients are now able to send a custom injury alert to the orthopedic experts at a Center with pictures of the injury in advance of their arrival. Users of the mobile app can now create multiple patient profiles—a feature designed to help parents or coaches build a system for rapid decision making and notification at the time of injury, when seconds count.”
Dr. Badia told OTW, “Our decision to include Uber in our mobile app is fundamental to the mission of OrthoNOW. As technology evolves, so should the process of how, when and where healthcare is delivered. We can see no reason why injured patients should report to a packed emergency room where a majority of illness and accidents would neither fall into the realm of either specialty or priority for the vast amount of on-call overworked ER physicians. The Uberization of medicine allows for a patient or his caregiver to be aware of nearby appropriate, alternative locations for specific treatment. Further, technology such as ours allows for the transmission of an ‘on my way NOW’ message, relaying critical information such as a description and photo of injury and estimated time of arrival. These features allow the center staff to be prepared when the patient arrives saving time, money and increasing positive outcomes. Lastly, this eliminates the wasted resources for those patients who do not need an ambulance to get treatment but have no other transportation options.”
“Our 90-day goal is to create awareness about the OrthoNOW app and get it downloaded onto the phones of professionals including: coaches, trainers, employers, teachers, risk managers and human resource directors, whose day to day life includes a potentially high number of injury victims.”
OrthoNOW CEO Alejandro Badia is more driven than ever on his mission to make orthopedic urgent care readily accessible for patients all across the United States
Dr. Alejandro Badia’s big, hairy, audacious goal is for his company OrthoNOW to be as synonymous with orthopedic urgent care as Starbucks is with coffee. But Badia knows that there is much more to achieving goals than just identifying them. His priority has always been giving access to great medical services that saved patients time and money. Now he is going further.
“People should get excited about the fact that through simple technology, like an app on a smartphone, they can have access to faster and better medical outcomes with less cost and decreases in wait and recovery time,” says Badia, OrthoNOW’s cofounder and CEO. “That, to me, is groundbreaking.”
OrthoNOW, the nation’s only franchised orthopedic urgent care center, evolved out of Badia’s frustration with the traditional healthcare delivery method of going to an emergency room, receiving an initial consult and often unnecessary and costly test, and being referred to a specialist. OrthoNOW cuts out the emergency room middleman, providing specialist services to patients right away.
When Hispanic Executive first spoke with Badia in 2014, the organization was in the early stages of franchising, with a flagship location in Doral, Florida, and plans to expand in the state’s Broward County. In 2016, OrthoNOW has seven locations with plans to expand in Orlando. Badia, an internationally respected hand and upper extremity orthopedic surgeon, leads this initiative with his cofounder Justin Irizarry, a leading financial industry figure and Wharton alumnus, as well as with select members of their executive team.
While a majority of the centers are located in Florida and Georgia, “our goal is to be a national presence,” Badia says. “But we realize that large-scale expansion of urgent orthopedic care will take some time and unique marketing campaigns to achieve.”
OrthoNOW has also developed its own app that will let patients give the company a heads up that they are on their way. Users can open the app, which will help them find the nearest OrthoNOW and register with their name, ailment, and when they plan to arrive. The patient is in the system and by the time they get to the nearest OrthoNOW, an x-ray technician is ready to see them right away.
“We’re well ahead of the curve now in terms of not [making patients] sit around the waiting room,” Badia says. The next round of updates to the app will include a more attractive interface, using Google Maps to find the nearest OrthoNOW, and the ability to contact Uber through the app if you need a ride to the center.
Badia and his team are working hard to find potential franchisees to help them continue their quest for a national presence. Currently, there are six franchises located in Florida and Georgia. “Our initial thinking was that independent physicians would buy a franchise and be armed with OrthoNOW marketing materials that they could tweak for their purposes,” he says.
While interest in the franchise model is high, the executive team has found that potential franchisees want to see OrthoNOW put up more money to get the location up and running. “We understand their perspective,” Badia says, “but we also know that to run a franchise that way would not lead to stable, long-term growth.”
OrthoNOW continues to work toward expanding its brand nationally through franchise sales. The effort begins by carefully selecting those the company feels will be an ideal franchisee and someone who is serious about opening up a location. To help identify potential owners who would be a good fit, Badia and his team are putting more focus on increasing their candidate search pool.
The group will do this by increasing marketing aimed at the franchise buyer public. One avenue for connection includes hosting regular “Franchise Discovery Days,” which are events put together by the company’s chief development officer. Badia, the chief financial officer, and the marketing team band together to show interested franchisee candidates what OrthoNOW is all about. The day includes “transport by minibus to two to three locations so they can see the centers in action,” Badia says.
“Our model is designed to spark the interest of people who realize that healthcare is a safe business,” Badia says, “one that is here to stay, or a conglomerate that has knowledge and a presence in the healthcare industry who would partner with us or acquire us, which would hyper accelerate national expansion.”
Another proactive step to bring in more patients and activate more centers is to find people with healthcare experience and integrate them into upper management. Included in this push for talent is a chief development officer to oversee franchise sales and a director of clinical operations to help set up protocols from a clinical end. The biggest change on the executive level Badia would like to see, however, is at the top—he wants to replace himself as CEO.
“Honestly, [performing surgery] is what I love to do,” Badia says. “I think I’m a very good hand surgeon. I enjoy that. I did not begin this corporation thinking of transitioning into healthcare administration but rather creating a vehicle that would disrupt traditional healthcare and produce better outcomes for patients. Now that we have traction, I would welcome the onboarding of a top-notch healthcare administrator as CEO to lead us to our goals.”
You might not think of urgent-care centers, where you can come in off the street for quick treatment of a flu or stomach ache, as retail outfits. After all, they don’t sell clothing, makeup, auto parts, or other actual products the way classical retailers do.
But Justin Irizarry does think of it that way. Irizarry, the co-founder and CFO of OrthoNOW, which touts itself as “the nation’s only network of orthopedic urgent care centers,” feels that location is what makes the firm’s franchise operations akin to retailers. By the end of this year the franchise firm will have sponsored eight centers Florida and two in Georgia, and plans to double that number by the end of 2017.
“It is a retail operation because the centers themselves are located in retail shopping centers or retail locations. You will see an OrthoNOW facility five or six bays down from an anchor tenant. It might be right next door to the grocery store or pharmacy,” the finance chief notes.
“If we’re really trying to make the delivery of expert orthopedic care convenient, then we have to be where people are going naturally. And that’s what pushes it toward a retail model,” he says.
Unlike retailers, however, the centers carry no inventory. Perhaps more significantly, the firm doesn’t face the biggest challenge brick-and-mortar retailers face: online competition from the likes of Amazon. Despite the advances of telemedicine, you can’t get your broken arm set over the internet.
At the time, Irizarry feels his firm is well positioned to compete with generalized urgent care centers. “Urgent care centers are very good for treating a wide range of issues. But one of the issues they are very poor at treating is orthopedic and musculoskeletal injuries: any sort of sprain, strain, break, fracture, concussion, laceration, or tear,” he says.
The reason? “Those sets of injuries require specialist care, and will only get worse over time unless they are cared for correctly the first time around. If you have a bad ankle fracture right now, and you go to the emergency room or urgent care center they will give you ibuprofen, ice, and homework,” he says.
“The homework is that you have to follow up with a specialist when you get home. The time it takes you to see a good orthopedic specialist would be two or three weeks,” Irizarry adds. Because of that time lag, “you’re much more likely to need surgery or something more advanced than just a simple treatment.”
Along with his partner, Dr. Alejandro Badia, a hand surgeon, Irizarry looked at the situation and decided to “disintermediate that process altogether” and build the centers. “We’ll staff them with orthopedic specialists, and the value proposition will be: if you come to us you’ll be in and out in 70 minutes or less, and when you walk out the door you get to go home and do nothing else. You walk out treated.”
Starting a business related to orthopedics also had personal appeal for Irizarry. As a stellar center fielder for Cornell University, he suffered considerable pain as a result of a congenital spinal problem aggravated by the wear and tear of stealing many bases. The existing treatment options didn’t suit his needs, he said in a recent interview with CFO. Edited excerpts from that conversation follow.
I do. I was initially a Wall Street investment banker at Scott Macon in New York. I left after five years of building a practice in M&A, went to business school, started my own consulting practice, and moved to Miami. One individual I met through the Cornell Club of South Florida was Dr. Alejandro Badia, a world-renowned hand surgeon. And he had envisioned this idea of OrthoNOW and had actually started the first center, which is in Doral, Florida. We started working together in an arrangement in which I brought the business expertise and he brought the clinical expertise. We perfected the local model and in 2013 started the network model, which is basically a franchise system.
I played four years of college baseball at Cornell and have a congenital spine problem called spinal stenosis. I could never get relief from it, and the world of orthopedics was always very scary to me. It’s sort of a big word if you don’t know what it is. And so I ended up playing in pain, 60 games a year. I wish I had had a concept like this in which I could have just gone and gotten worked on in a friendly, non-threatening atmosphere. That was absolutely part of the draw for me. I should mention that in the centers, patients aren’t just being treated for fractures or back injuries but are also rehabbing or “pre-habbing.” We have a number of therapies for athletes that are going to play four baseball games in the next week and want their muscles loosened up or their bodies stretched out.
I was a centerfielder for Cornell, batting leadoff. My biggest asset on the baseball field was my speed. I will humbly say that I had freakish speed. My job was to get on base, whichever way I could. Then I would be a very aggressive base runner. I’d steal second a lot, steal third, steal home, and then cover a lot of ground in the outfield. In my junior year I set a record at Cornell for most stolen bases, with 40 or 41 in a 55- or 60-game season. I also hit above .300 as a lead-off guy. We would play two doubleheaders on the weekend, and there could be another two doubleheaders during the week. So we could play a total of eight games in a span of seven days. And that’s all while you’re trying to keep up with academics.
I played in a lot of pain. Spinal stenosis is a narrowing of the vertebrae, the canals that all the nerves run through. They would get inflamed with a lot of rotation. If you think about how you use your body in baseball it’s almost all rotation: When you throw the ball, hit the ball, run there’s a lot of sort of left-right force that’s being generated.
I do. I’m actually a patient at one of the OrthoNOW centers down here in Miami, where I’m also a part owner. I eat my own cooking, or my own dog food, as some people say.
It’s actually very complementary. We have a mobile application that allows patients to tell us what their injury is, take a photograph of it, and let their local center know that they’re on the way. Let’s say you sprained your ankle playing soccer. You pick up the phone, and you’re able to locate and contact the nearest OrthoNOW. Then we will have an Uber car come and pick you up right at the soccer field and take you to the nearest OrthoNOW center. The center is waiting for your arrival when you walk in the door.
We also do online consultations, using telemedicine to talk with patients that might be 50 miles away from the nearest center. With the high-definition available on an iPhone, you can say, “OK, move your hand this way. Does it hurt? Move your hand that way, does it hurt?” You can make diagnoses based on that interaction and actually save the person some time in so doing.
Absolutely, because we can and we do charge for consultations. But it also allows us to expand the addressable market. That’s because if you can triage or at least get an initial reading of a patient’s problem by telemedicine, you can reach a lot more people than if they were all in your waiting room. You don’t have that physical constraint.
If you’re a surgeon, whether it’s a sports-medicine surgeon or an orthopedic surgeon, all you want to do is surgery. That’s where you are most valuable to the patient and why you went to school and paid your dues. About 17% of patients that walk through our centers need surgery. The draw for a sports-medicine doctor or an orthopedic surgeon is that they get to do more surgery on the patients that they’re seeing. It’s a great patient feeder for them for surgery. It doesn’t replace their job, it just gives them more of what they want to do and more of what they are well compensated to do.
When you walk into a center the person you will most likely see is called a mid-level provider, either a physician’s assistant (PA) or a nurse practitioner. But those PA’s or nurse practitioners, who work full-time, have specific experience and training in orthopedics. Those PA’s or practitioners report up or are supervised by a sports medicine doctor or an orthopedic surgeon. That doesn’t require the orthopedic surgeon or sports medicine doctor to be on staff full time. We use telemedicine for consultation. The PA and the supervising physician are constantly in contact.
One of the things that frustrates me the most as the CFO is what I consider to be a lack of appreciation by insurance companies for the actual value that we deliver. Urgent care is largely an insurance business. You can come to us with any sort of insurance and we’ll see you. But if you have a fracture and you go to the emergency room, and your insurance pays $1,800 and then you have to go to an orthopedic surgeon and have surgery, the bill is astronomical. If you come to us and you’re treated the first time around your insurance company would pay us a fraction of that. And one of the things that frustrates me is that sometimes the insurance company gives us a hard time about paying you for your visit or doesn’t pay us what I see as a fair rate. And that’s my biggest frustration as the CFO.
In their continued commitment to providing outstanding patient care OrthoNOW®, the nation’s only specialized urgent care franchise, announced today that they will be offering Master Franchises in 54 exclusive territories available across the US. OrthoNOW was co-founded in 2010, by orthopedic surgeon Dr. Alejandro Badia and financial industry expert and Wharton alumni Justin Irizarry. The duo saw an opportunity to disrupt the multi-billion-dollar orthopedic health care delivery system and to simultaneously achieve the industries “Quadruple Aim”: better outcomes, lower costs, improved patient experience and improved clinician experience”. Recently the group was named a “Top Ten Franchise Opportunity” by Entrepreneur Magazine.
Dr. Badia said “Disruptive innovation is occurring across the United States specifically to break the dominant business models and level the playing field. OrthoNOW provides our Master Franchisees a system where they can develop an enterprise level orthopedic urgent care business for the specific purpose of providing the general public with on-demand access to quality, specialty care while building dream equity for their families future”.