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June 18, 2020

Obsolete Maps

[Part Three in a series.  Click here for Part One and Part Two.]

As I have been reflecting on my great-grandfather’s losing battle with the rising Arkansas River in 1943, I realized that as a now ‘city boy’ (according to my redneck brother) I don’t naturally think in acres.  Blocks, neighborhoods, interstate exits – these are my geographic frames of reference.  Acres are not as natural for me as they should be for someone with farming roots.

In that flood, 450 acres forever disappeared underwater as the river changed course.  My 24-home typical suburban neighborhood sits on about 10 acres, so 45 of those.  A square mile covers 640 acres, so about 70% of that.

Gone.

Forever.

Here is where we get to the really hard part of the coronavirus reality.  Not the part about short-term pain or inconvenience or the challenges in restarting, but the part where we stare hard at the situation and ask, ‘Is it gone forever?’

Last weekend I was happy to plop down in the booth at our favorite Mexican restaurant for an enchilada and a margarita. But in about 30 seconds you realize that despite their best efforts, the math just doesn’t work.

I flew for the first time yesterday and while I enjoyed having a row, or seven, to myself with room to spread out, the same math was easy to do.  As it was at the hotel. And many other places you see.

Many just won’t make it.

Their business is, or is sliding toward, the bottom of the river.

Surely this can’t happen to physician practices, right?  I mean, we’re talking doctors here, superheroes in white lab coats.  Wasn’t there some implied and unspoken promise for surviving med school?

Devastating floods and microscopic killers are indiscriminate.

The prognostications on physician practices that will close shop, particularly small practices and especially primary care, are blaring everywhere.  That has not yet happened at a doomsday level and maybe the soothsayers got a little carried away.  Or maybe PPP loans and Medicare advance payments propped up some dead practices that just haven’t fallen over yet.

I recently spoke with some folks who work with a lot of small practices and they are optimistic.  Maybe it was their unique market, maybe it was more hope than realism.  I’ll hang on to their take as we all want some good news.

But the math of business applies to physician practices, too.  Take enough volume out for long enough and it ends up under 25 feet of water.

Well, that was cheery, wasn’t it?

Dan Dan might tell us there are two options: quit farming and move on, or you better work the land you have and maybe go find some more.

This is where we’ll be focusing in the weeks to come.  You’re going to hear things you’ve heard from me before, only with more urgency.  You’ll hear some new thoughts based on our new reality.  But I assume you still want to keep farming, keep practicing medicine and taking care of patients.

So, let’s get after it.

Tim Coan
Tim Coan

CEO and founder

Tim Coan, ALN’s CEO, writes an insightful and witty blog weekly about a variety of topics relevant to independent physician practices.