This Florida chiropractic clinic network, modeled after a medical group practice, finds that bigger is better.

Daniel J. Pavlik, DC, is the founder, chairman, and president of Access Healthcare Inc, a network of 125 Florida chiropractic clinics, plus four in Orlando that he owns and operates himself under the name Pavlik Chiropractic Group.

Pavlik started as a solo chiropractic practitioner, but 5 years later in 1985, he was well on his way toward building what is now a gigantic group practice, which he hopes one day will stretch from coast to coast.

Now, Pavlik occasionally sees patients. The demands of running a successful enterprise of this magnitude are such that he has little time for clinical work. "I have a short list of patients I still adjust. These are people who have been patients for many years," says Pavlik. "I continue to treat them because they have been so loyal. Plus, it keeps my clinical skills honed, which is critical for anyone who has gone over to the corporate side of the chiropractic profession. I don’t think you can be successful without up-to-date clinical skills."

Safety in Numbers

Daniel J. Pavlik, DC

Access Healthcare allows Pavlik, the chiropractors he employs, and those who are under contract, to effectively compete for managed care business and make a decent living at the same time.

"Grouping together is the most viable form of practice," he asserts. "I’ve always felt there is strength in numbers. I’ve also felt that, if managed care contracts were going to be a substantial part of a practice’s income, the only way to economically survive was to have leverage to negotiate adequate reimbursement rates. The only way to acquire such leverage is to be in a large group setting. In short, large-scale groups like this offer the best way to prevent payors from digging into the providers’ pocketbooks to take dollars away."

The goal, as Pavlik puts it, "is to build a bigger fort. The larger the fort and the higher the walls, then there is greater security for those within."

Unlike many chiropractors who have fled managed care for the comfort of a cash-based practice, Pavlik intends to continue his relationships with those penny-pinching payors. "I don’t fault anyone who runs a cash-based practice," he says. "There’s nothing wrong with that at all, except for one thing: what happens to those patients who don’t want to pay cash? Basically, they’re out of luck. I think those patients deserve access to chiropractic care. They should not be denied just because they prefer to pay through an HMO or managed care plan." About half the Access Healthcare and Pavlik Chiropractic Group patients are covered under a capitated contract arrangement. The remainder pay with cash or some form of conventional insurance.

Model Behavior

The Access Healthcare model is patterned after a medical group practice, according to Pavlik. "Medical group practices struck me as a good and proven business model that chiropractors could and should replicate," he explains. "As every young chiropractor fresh out of school plans, I was going to go out on my own and be successful on my own. I soon realized this was naive—the real world was changing. Mom-and-pop practices were the norm in the past, but they were falling by the wayside as managed care began making strong inroads into the market here in Florida. It seemed to me that the days of the successful solo practice were about to come to a close. As I looked to see who the survivors were, it was the large groups of physicians. I felt that’s where chiropractic had to go if it was to survive."

Pavlik theorized that managed care organizations actually would welcome dealing with a sizable chiropractic group. "Those payors seemed to prefer working with big entities," he says. "That’s understandable. It’s easier for managed care to administer its product when overseeing one or two major players rather than many little ones."

Pavlik’s vision for a powerhouse of chiropractic in central Florida began with one clinic, and then he acquired three others in rapid succession. Next, he began talking to other chiropractors about affiliating their practices with his under a contractual arrangement. "What emerged was a preferred-provider organization, wherein members would be organized around standards of reimbursement and care," he says.

Back then, the network was known as the Academy of Industrial Health Consultants (AIHC), a PPO made up of 23 offices. Pavlik organized this fledgling group around a central administrative office. "My philosophy about the delivery of care was that it had to be local," he says. "However, in a group setting, you’re going to have multiple local delivery sites. That means multiple clinics, staffs, and front and back offices. The only way to keep costs under control in that environment is to centralize the back office, which is what we did."

AIHC grew at a phenomenal rate, reaching a peak of 1,400 offices across the entire southeastern United States by the time it disbanded in 1994, but it was starved for the cash necessary to run its administrative infrastructure. "The managed-care market had undergone a shift, so the PPO model was no longer economically viable," Pavlik tells. "Specifically, we weren’t generating enough capital from these contracts to be able to give payors what they were demanding—reams of documentation and extensive utilization controls."

At this point, the HMO model of managed care superceded the discounted PPO fee-for-service model. With this advent came capitated contracting. Pavlik nimbly adapted his business strategy to be able to take advantage of this change. Pulling together several dozen Central Florida offices that were part of AIHC, Pavlik unveiled Access Healthcare Inc. "I’m proud to say that some of the work we’ve done here in our Central Florida group set precedents in the capitated-contracting model adopted by one of the nation’s leading managed care companies," he says.