Doctors? Company Provides Clinic Management Services

Physicians from three prominent Fayetteville clinics have formed a new company to manage the business side of their practices.

Articles of incorporation for Medical Services of Northwest Arkansas Inc. were filed June 8 with the Arkansas Secretary of State’s office. Its owners include Fayetteville Diagnostic Clinic Ltd., Northwest Arkansas Pediatric Clinic P.A. and First Care Family Doctors LLC.

CEO Larry Shackelford says the new company’s owners hope to benefit from economies of scale by combining certain functions common to each, such as purchasing, general ledger work and payroll.

“We’re going to look at being able to do some joint contracting with other [medical groups],” he says.

Although similar companies — usually referred to as management services organizations — are common in other areas, Medical Services of NWA is believed to be the first physician-owned MSO in the region.

“The advantage is this puts the lion’s share of primary-care physicians in Fay-

etteville in one entity,” Shackelford adds.

Fayetteville Diagnostic Clinic has 20 physicians while the pediatric clinic has eight. First Care Family Doctors has seven physicians. Shackelford estimates that the group includes about 80 percent of the internists in Washington County and about 75 percent of the pediatricians. The group’s thrust is aimed at but not limited to Washington County doctors.

It is, officials say, a direct response to managed care, which typically increases paperwork required of physicians while reducing the fees they may charge. Theoretically, at least, an MSO allows even small practices to have their own certified public accountants and other specialists as well as computer services.

Jason Wilson, CFO for the newly formed Medical Services of NWA, explains: “The Rogers guys have decided selling to a hospital system is the way to [respond to managed care]. We’re looking at [the MSO] as an alternative for doctors who want to remain independent.”

Wilson says he hopes to consolidate the clinics’ computer systems that do billings by the first of the year.

The clinics were able to form the new company fairly quickly because organizers drew from prior research and discussions involving a possible merger of the three groups.

Merger remains a possibility, both men say.

“I think merger will always be a possibility,” says Wilson. The management services organization allows the groups to retain their own identities without addressing the more complicated issues of real estate or allocation of income.

Each of the three clinics owns shares in Medical Services of NWA. Another stake is held by the administrative group, which includes Shackelford, formerly administrator for the pediatric clinic; Wilson, who was CFO for the diagnostic clinic; Paula Maxwell, who was director of patient care for the diagnostic clinic; and John Jordin, formerly administrator of First Care. Maxwell is now vice president of clinical operations while Jordin is vice president of business operations.

All four will have offices at Fayetteville Diagnostic Clinic, but that may change later if the administrative offices are converted to physician space.

Mercy Health gains another clinic

Mercy Health System of Northwest Arkansas has purchased another clinic: The Rogers Clinic for Women, which specializes in obstetrics and gynecology. The three physicians who practice at the clinic are Dr. A.R. Addington, Dr. John Pappas and Dr. Karen Lanier. The clinic was founded by Dr. James Elkins, who now has a private practice in Rogers.

The clinic is the 11th purchased by Mercy Health, which also owns St. Mary’s Hospital. The practices form an entity called Mercy Medical Clinics.