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Orthopaedic Specialty Institute (OSI) is merging with three other practice groups, housing multiple specialties under one roof.
OSI was already partnered with Seaview Orthopaedics and Southern Orange County Orthopedic Group and recently added on Integrated Specialty Partners, launching a new neurosurgery division.
“The way medicine has trended over the last 10 years is that most groups are being acquired by Cedars-Sinai or University of California, Los Angeles, but our group has remained independent, which gives us control of our own destiny,” OSI Managing Partner Dr. Jeffrey Deckey told the Business Journal. “So, we’ve really wanted to keep that model.”
OSI said it is now the largest independent orthopedic and neurosurgery provider in Southern California with 35 orthopedic physicians and neurosurgeons and 21 mid-level providers.
There are larger orthopedic health systems in Orange County, such as Hoag Orthopedic Institute, which has 577 local employees.
The merger expands OSI’s OC footprint with new offices in Laguna Hills, Mission Viejo and San Clemente, growing to six total clinics on top of its existing locations in Orange and Irvine.
OSI last month relocated its Orange clinic to a 20,000-square-feet office within Providence St. Joseph Hospital’s Helen Caloggero Women’s and Family Center.
Providence, CHOC Partnerships
OSI was formed in 2002 by a group of private practitioners looking to form one entity.
“We took a bunch of orthopedic surgeons who were extremely passionate about patient care and quality and formed OSI,” Deckey said.
OSI specializes in non-surgical and surgical treatments in sports medicine, joint replacements and spine surgery.
The addition of neurosurgery complements the rest of OSI’s list of specialties, Deckey said.
A significant portion of a neurosurgeon’s practice involves spinal surgery as it is a central part of the nervous system.
“What this allows us to do is really provide consistency in terms of orthopedic and spine care throughout the county,” Deckey said.
The newly formed neurosurgery division will be led by neurosurgeons and pain management specialist Dr. Alvin Chang, Dr. Brian Hwang, Dr. Robert Jackson, Dr. Jason Liauw and Dr. Warren Reuland.
Early on, it formed a partnership with St. Joseph Health which in 2016 merged with Providence Health & Services to form Providence St. Joseph Health.
OSI also provides pediatric orthopedic surgery through another partnership with Children’s Hospital of Orange County (CHOC).
OSI has benefitted from its collaborations with Providence and CHOC, according to Deckey.
“We’ve been able to collaborate with them in terms of delivering orthopedic care and certainly inpatient care, and that’s been really key to our success,” Deckey said.
Challenges to Independent Providers
OSI’s model of remaining independent by merging with other medical groups is indicative of a budding trend of physicians wanting to branch out from large organizations amid a backdrop of private equity rollups, Deckey said.
About 70% of physicians graduating medical school or completing residency go on to be employed by a large hospital group or university, according to Deckey.
“It’s more recently those physicians have felt somewhat frustrated in terms of the flexibility they have in terms of taking care of patients being tied to a big organization,” Deckey said. “We see that with concierge medicine.”
The cost of running a practice, however, makes it challenging for smaller independent groups to survive, which is why OSI created an affiliate management services organization called Quantum Health Services.
Quantum, established about five years ago, has allowed OSI to centralize its IT, medical billing and human resources, Deckey said.
“We’re able to not only provide the optimum care for the patient, but also do it in a much more efficient way to bring down some of the financial pressures that smaller groups feel,” he said.
Founding Physicians of Hoag Orthopedic
Many of OSI’s physicians were also founding partners of Hoag Orthopedic.
About 15 years ago, Newport Beach-based Hoag Memorial Hospital Presbyterian approached OSI and other local groups to form an orthopedic inpatient and outpatient hospital, Deckey said.
“OSI played an integral role as founding physicians to form the orthopedic institute,” Deckey said. “The advantage of that was really allowing us to be intricately involved in the management of the hospital.”
Deckey, one of the original partners of OSI, specializes in spine surgery, performing over 350 operations annually.
Deckey was one of the founding physicians of Hoag Orthopedic and is chairman of the Surgical Spine Fellowship at the institute. He’s also an attending physician at St. Joseph Hospital and CHOC.
Over the past 20 years, Deckey said he has developed an interest not only in surgery but teaching.
OSI now has nationally recognized fellowship programs to train orthopedic surgeons in subspecialties after they complete their residency.