Integrative Medicine Clinic Reports: Marino Profits Rise, Heartspring Expands, Wellspace in Retro Announcement
Summary: Reports from both coast show growth in revenues and operations in primary care-driven integrative medicine clinics. Boston-based Marino Centers for Progressive Health generated $650,000 in excess income over costs in 2006, leading to a plan to add 3700 square feet to one of its sites. Across the country Heartspring Wellness Center also announces plans for an additional center in its service inside the Samaritan Health System. Meantime, Boston-based Wellspace, led by a new set of venture capitalists, sends out an oddly optimistic, retro press release ...
Send you integrative clinic news or comments to
for publication in a future article.
1. Marino Center Banks $650,000 Profit in 2006, Sets Growth Plan
The model at the not-for-profit Marino Centers for Progressive Health is working. The 15 primary care doctors (11 internal medicine and 4 family practice) are seeing patients an average of 30-60 minutes a visit, according to administrator Carmen Pascarella. "We're billing what we do and insurers are paying," he adds. The operation, now in two clinics, fills 7,700 square feet and is about to have another 3,700 built out for a 11,700 total. On $7.7-million of net revenues, the Boston-based operation turned an operating profit of $650,000 in 2006.
The total set of providers is 35-40, and includes 5 nurse practitioners, 4 licensed acupuncturists, 2 chiropractors, 3 physical therapists, 2 massage therapists, 2 psychologists, 2 nutritionists, 1 social worker and additional registered nurses. Pascarella says that Marino has just set up a task force looking at what the "Marino way" is in integrative medicine. The clinicians meet weekly for 60 minutes of "mostly clinical" discussion states Pascarella, adding: "That meeting's our Bible."
Comment: Marino has earned its success the hard way, after losses of literally millions in philanthropic support from the Marino family. A turning point: moving away from a CAM only model to a structure built significantly around primary care providers. Interestingly, this history, and recent success, directly parallels to Inner Harmony Wellness Center operation founded by Peter Amato. Amato's lessons for success printed here include the acknowledgment that it's primary care that drives revenues.
2. Integrative Developments Near Corvallis Oregon
Mary Ann Wallace, MD, writes that her group at Heartspring Wellness Centeris "helping the Emenhiser Cancer Center in
Lebanon, OR, add complementary services to their program." Wallace, medical director for integrative medicine for Samaritan Health System, says the approach at Emenhiser, also part of the Samaritan system, is "sort
of redefining 'integrated cancer care' to include more parameters that
attend to
the mind and spirit of those undergoing chemotherapy and radiation
therapy." (Typically, programs will include pastoral counseling, for
instance as part of an "integrated" team consisting of the oncologist
and nursing staff and perhaps a social worker.) Wallace writes of the additional parameters: "So
far, we've hired a massage therapist and are now interviewing
for a nutritionist well versed in herbals and nutriceuticals."
Mary Ann Wallace, MD, Heartspring medical director
The Corvallis-based Heartspring Center is also adding primary care as part of new growth. Reports Wallace: "We
are again in the process of expansion, with plans to add primary care,
using a
somewhat refined 'chronic disease model' to focus on patient
education and lifestyle, behavioral changes - utilizing mind-body
therapists and
stress reduction techniques as the team members with the docs." Wallace
points out that they have "a ready team" which consists of
acupuncturists, massage therapists and a naturopathic doctor "to help
with the whole picture." Heartspring
is setting up a second site, in Albany. Wallace notes that the
learning of their five years has led to a variety of additional
consulting.
Comment: Note that the expansion, again, is primary care. The major player in integrative medicine here in Seattle, Seattle Healing Arts (SHA)
also thrives on a primary care model. SHA, led by Fernando Vega, MD and Bruce Milliman, ND, has a mix of medical doctors and
naturopathic physicians. (NDs are recognized as part of the primary care
mix in the state and are primary care providers in some major health care plans.) An earlier Integrator note on the Heartspring operation is here.
3. Wellspace Pokes up It's Venture Capital Head ...
Mort Rosenthal, a successful software executive and founder in 1997 of Wellspace sold his stake in his ambitious project a half decade ago. His
venture capital-backed operation envisioned a national roll-out of branded Wellspace clinics. After five years, Rosenthal publicly acknowledged in 2002 that
the model couldn't economically support a national roll-out. He had a provider mix which was mainly massage therapists and acupuncturists, plus a
lone naturopathic doctor who was also an acupuncturist. (The
naturopathic doctor's services were limited because Massachusetts has
no licensing.) No MDs, no nurses, no primary care and no 3rd party payment. Rosenthal learned that he could generate sufficient revenues to keep the clinic open but there wasn't enough margin to energize the venture dream. Bottom line: there simply wasn't enough profit that could be taken off a massage visit. I followed the cycle closely, serving for a time on the firm's advisory board.
So a press release published through Yahoo Business on January 24, 2007 came as a surprise. The headline splashes: "Wellspace Reports Explosive Demand for Integrative Medicine."Current owners Paul Clemente and Daniel Braz, both
ex-Wall Street people with some healthcare experience,
appear to be making another run at another national roll-out. The release states
that the business at Wellspace's grew 300% last year. The operation has "gone
from one to four locations." The firm's website describes two of the
acquisitions. One is a large massage practice since converted to
have other providers of natural health care, but no MDs. A second is a
single operator, male, integrative gynecology practice. The third is not up on the site. The Wellspace team, according to the release, recently spoke before the Harvard Business School class of consumer-healthcare maven Regina Herzlinger, PhD on "Innovation in Healthcare Service Delivery." Comment: From the title
on down, the feel of this release is that of the rise of CAM into consciousness of the mainstream healthcare industry a decade ago. Data about
complementary healthcare usage began to drive a lot of pie in the sky
business models. Such as Rosenthal's. Do these two new Wellspace owners know something that we
don't know which can turn into sustaining gold, not just open the venture capital spigot from unsuspecting but perhaps passionate investors? The revenue growth boasted about in the release appears to be a function of acquisitions, not "explosive demand." Maybe there is still room for magical thinking on Wall Street. Is there a new generation of investors who have no memory of the Wellspace and American Whole Health losses?
Take a look at the release and see what you think. One thing will be clear: the writer forgets the Rosenthal era by referring to the Clemente-Braz team as Wellspace's founders. One hopes that they haven't also forgotten the lessons hard won in the Rosenthal era. As an esteemed student of history once said, yes, history repeats itself - the first time a tragedy, the second a farce.
Send you integrative clinic news or comments to
for publication in a future article.
The total set of providers is 35-40, and includes 5 nurse practitioners, 4 licensed acupuncturists, 2 chiropractors, 3 physical therapists, 2 massage therapists, 2 psychologists, 2 nutritionists, 1 social worker and additional registered nurses. Pascarella says that Marino has just set up a task force looking at what the "Marino way" is in integrative medicine. The clinicians meet weekly for 60 minutes of "mostly clinical" discussion states Pascarella, adding: "That meeting's our Bible." 
