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Update on a "Social Business" Model: Working Class Acupuncture Had 448 Patients Last Week PDF Print E-mail
Written by John Weeks   

Update on a "Social Business" Model: The Working Class Acupuncture Clinic Had 448 Patient Visits Last Week

Summary: One of the Integrator's Top 10 for integrative practice for 2006 was Working Class Acupuncture. The Portland, Oregon-based business, controversial in the acupuncture community, promotes greater access to affordable acupuncture services through a business model in which acupuncture is delivered in a community room. Patients average $19 per visit. Now just 3-years-old, the clinic, which anchors a national network, had 448 patient visits in the final week of August 2008. Visits for the month were at over 1600, up 33% from the prior year, and quite likely the highest number of any acupuncture clinic in the United States. Co-founder Lisa Rohleder, LAc shares data on visits, salaries and expansion of this business about which they discovered, on reading the work of Nobel Peace Prize winner Muhammad Yunus, is a classic "social business."
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Image
Working Class Acupuncture logo
Lisa Rohleder, LAc contacted me in early August because National Public Radio was planning a Marketplace story on the unusual model of the business she co-founded, Working Class Acupuncture. Rohleder asked if the reporter could query me about other clinical models in which services are being delivered to a group. I spoke with the reporter, Joel Rose, and suggested Kjersten Gmeiner, MD, who was until recently "group visit leader" for Group Health Cooperative. (See
Interview: Holistic Leader Kjersten Gmeiner, MD on the Fit of "Group Visits" with Holistic Medicine, September 8, 2007.)

After the show aired on September 2, 2008 (text available here), Rohleder was pleased and thanked me via e-mail for my small hand in it. Gmeiner had been quoted in a useful way. I asked how things were going. She and I had first been in touch when I visited the clinic and reported on the WCA's truly revolutionary, controversial business strategy for giving more patients access to acupuncture and putting more licensed acupuncturists to work. (See Working Class Acupuncture: Revolutionary Business Model Creates Access, Fosters New Business, November 22, 2006.)
I selected the for-profit WCA and the not-for-profit Community Acupuncture Network it birthed as one of the Top 10 developments for integrative health care for 2006. Rohleder wrote back in response to my query:
"WCA has gotten a lot of local publicity lately (all of it listed on our front page at www.workingclassacupuncture.org), some of it highly amusing, and so we continue to get busier and busier. We're now open 7 days a week. The last week in August (which is supposed to be slow, right?) we had 73 new patients and 448 total patient visits. We have six full time salaried acupuncturists and we're getting ready to hire at least one more."
Now, that is tantalizing: 448 patient visits in one week! I asked Rohleder for more information. Rohleder and her partners have always shared business details. It's part of the transparency of their business model and key to their support of other acupuncturists who are in the Community Acupuncture Network. Here is a data-filled update based on materials she shared with me electronically.

__________________________________

Working Class Acupuncture: Monthly Visit Numbers
Summer 2007 and Summer 2008



2007
  2008
  2007
  2008
Month
Patient
visits per
week
   Patient
visits per
week
  New
visits per
week 
  New
visits per
week  


 
 
 
June
 320    377   31
   41
July
 283    381    22.5   38
August  292    405    33    52
               
Summer
Average
 298   388
   29    44

All data from Working Class Acupuncture, September 2008.
__________________________________

Rohleder notes that the 2007 client flow "dipped in the summer, which is typical for most practices." The visits did not dip in 2008. Says Rohleder: "Our theory is that our patient base is now big enough to create stability, and stability is one of our favorite things."


Acupuncture as a "social business" - as defined by Nobel Prize winner Muhammed Yunus

community acupuncture, CAN, WCA, Working Class Acupuncture
Patients receiving treatment in a community room
Rohleder and the WCA team distinguish their model from not-for-profit community clinics which use the community room model to serve the underserved. The latter are dependent on grants or philanthropy. WCA is a business.

Yet WCA is not an example of what is usually called a "socially-responsible business" that makes money then gives some away. The WCA model begins with a core perspective which Rohleder explains:
"For most acupuncturists, acupuncture is a vocation, kind of like farming. People don't go into acupuncture, or farming, for the purpose of making money (and if they do, they are not very bright, because there are much much easier ways to make money)."

Last year, the WCA team encountered the writing of
Muhammad Yunus, the economist [and founder of the micro-finance movement] who won last year's Nobel Peace Prize. In the concept of a "social business" described in his book, Creating a World Without Poverty, they felt they saw their own emerging model portrayed.

Says Rohleder: "
WCA is a 'social business.' A social business is not a 'socially responsible business' and it is not a nonprofit. It functions completely differently. The structure of a socially-responsible business is to make a profit and then use the money for good. The structure of a nonprofit is to subsidize doing good with money that has been made some other way. The structure of a 'social business' is not to make a profit at all, but to create 'social dividends.' If a social business does make a profit, it reinvests that profit immediately into itself rather than pulling it out and giving it to its owners or shareholders or to some separate nonprofit (as a 'socially responsible business' would do). We were doing all these things (at WCA) before we read his book, and we got all excited that there is finally a term for what we are doing."

Rohleder further explains that the social business model "is just to exist and do its thing without either depending on subsidies or making extra money beyond what it needs to meet its social goals." Instead, WCA's social goals are "to create jobs for acupuncturists and to provide acupuncture to people with ordinary incomes."


__________________________________

Working Class Acupuncture:  More Data on the Model


Annual budget (2008)
$426,000
Days open per week
7
Number of LAcs
6-7
Compensation form of
staff acupuncturists
Salary
Clinical hours/week per LAc
25
Average patients/week
per LAc to break even
70
Non-clinical hours/week
per LAc (diverse support tasks)
 10
Annual salary, staff LAc
$32,000
Annual salary, founders (2 LAcs,
one business person)
$35,000
Target annual salary
$40,000
Vacation days/year
10
Health care benefits
none
Monthly payroll taxes
$6,000
Sliding scale fees/visit (amount
decided by the patient)
$15-$35
 Average payment/visit
$19


All data from Working Class Acupuncture, September 2008.

__________________________________

Salaries and benefits for WCA's employees

Image
Founders Skip Van Meter, LAc, Lupine Hudson and Lisa Rohleder, LAc
As noted, WCA's 'social business' is based on a view that most licensed acupuncturists are deeply service-oriented. Asserts Rohleder: "Most acupuncturists want to make a living by doing what they love, which is acupuncture. Some time last year we realized that acupuncture is not a good part-time job and that all our acupuncturists would be happier if we could pay them a salary to work full-time at WCA. We asked them what they needed in order to do that - meaning, what did they need in order to live, make their student loan payments, not feel deprived. They told us and we did the math.
"

The $32,000 salary was the basis they established. Rohleder notes that while this may seem low, she does not think it is based on survey data on acupuncture income which suggest that 40% gross less than $40,000. Take home is less. WCA's
$426,000 of gross annual income divided by 6 acupuncturists equals $71,000 per acupuncturist. Rohleder suggests this is just about average, based on figures on an Oregon College of Oriental Medicine website. She opines, in her typically outspoken way: "There is an appalling disparity between what an AOM education costs and what practitioners can expect to make when they graduate."

WCA's acupuncturists work 25 clinical hours and 10 additional hours each week doing whatever most serves the clinic-as-community. In the model, everyone chips in where help is needed. Employees have vacation time but no healthcare benefits. WCA's founders determined that,
like many small businesses, "with 3 receptionists over 60, and the oldest 78," providing medical insurance was not affordable. She notes that the employed acupuncturists are closer to 30-years-old, and within 2 years of graduation from acupuncture school.

WCA's goal: "Open more clinics and create more jobs.  We would like to be able to pay everyone $40K per year, and if we grow the business big enough, that's realistic.
" Rohleder thinks it "unlikely that anyone at WCA, myself included, will ever be paid much more than that." She adds that "the future of benefits I have no idea about, because health insurance especially is so dysfunctional."

Payoff for the work: Each acupuncturist is a "nexus of a little community"

As Rohleder presents it, this "social business" is sustained through the community which is created, which she says is actually an overlapping sets of smaller communities around each acupuncturist.

Says Rohleder: "We have learned that the key to all of this is for each acupuncturist to see himself or herself as the nexus of a little community of patients.
Each of us tends to attract a different kind of patient, and our respective communities overlap with each other, especially in the case of those patients who are coming in more than 3 times a week for treatment, but they are also distinct. The connections that each of us feel with our patients are definitely a large part of the payoff for this work.

An ethic of frugality and efficiency necessarily prevails. She continues: "We are all living pretty frugally and the clinic itself is very efficient because it needs to be. Morale, though, is sky-high because everyone, including the reception staff, is passionately devoted not only to his or her job and to the
   
 
"The vast majority of our patients
are very grateful, very nice people,
and the experience of watching so
many patients get better (for both
the acupuncturists and the receptionists)
is intense and addictive."

- Lisa Rohleder, LAc

patients he or she interacts with, but to the rest of the staff. We weren't really expecting this; our staff is quite diverse, by age, background, education and personality. They are just crazy about each other. The people who catered our holiday party said they wanted to do it again next year because they were so inspired by how much we all love each other -- that kind of thing. I'm including all this because it's what we are trying to help other acupuncturists create as they become employers, even though we are not quite sure how it happened. I think it has something to do with the fact that the vast majority of our patients are very grateful, very nice people, and the experience of watching so many patients get better (for both the acupuncturists and the receptionists) is intense and addictive."

She adds: "So I want to make it clear that this is not a normal job; it's closer to a religion. We didn't plan that. In terms of the rest of the acupuncture world, and most of the rest of the business world, WCA is happily inhabiting an alternate universe (a nonloss, nondividend, fanatical little lovefest)."


Developments nationally and internationally

I asked Rohleder for information on the national network she and her team birthed as the Community Acupuncture Network. She estimates that the number of clinics using the community acupuncture model is at 100 "and might be twice that in reality." She counts
20 community acupuncture clinics "in Northern CA alone." Of CAN members, 20 are hiring new acupuncturists or "expecting to be there soon" and are participating in a CAN forum on the subject. Internationally, CAN is set to do a training in Victoria, BC. She notes that the UK organization, Affordable Acupuncture UK, "seems to be doing fine." She reports that the organization in the United Kingdom is planning its first conference.


Comments
: One can imagine that the WCA staff, from front desk to clinical, would be quite excited in seeing and feeling the hum of this small-ish center delivering over 400 treatments a week, week in and week out. Something is happening.
For the typically 30-year-old, newly licensed acupuncturists who probably had limited clinical experience in their acupuncture education, this scene may also be serving as an exceptional kind of residency. That this energy, coupled with the devoted leadership of the co-founders might create a "fanatical little love fest" is also easy to imagine.

Yet the salaries on which the model floats seems severly low. (I did not ask Rohleder the level of student loan debt these young doctors have.) The US median gross family income is $61,500.  Rohleder and her business-and-life partner, Skip Van Meter, LAc, together earn $70,000, roughly 18% above that threshold. While the choice is not for everyone, it clearly works for them. Rohleder shared that they just sent their youngest child off to college.

Time only will tell how this model will work in the long run, or in less devoted hands. But for now, one thing is undeniably clear. This "social business" is succeeding in its twin missions "t
o create jobs for acupuncturists and to provide acupuncture to people with ordinary incomes." I would love to see a functional analysis of the experience for both patients and employed acupuncturists.

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for inclusion in a future Your Comments Forum.


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