Dialysis Corporation of America: Stephen W. Everett, President & CEO

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Medicore Inc. was acquired by Dialysis Corporation of America (DCA) in a downstream merger in 2005. This was a follow-up to the decision, by the board of directors at Medicore, to approach the dialysis industry with more focus. Today, DCA is a seventy million dollar company, with over 600 employees, in 34 facilities across seven states, and is looking to enter new territories. “In 2006, DCA saw an increase in its patient base by 26 percent, through a combination of new facilities and internal growth,” elaborated Stephen Everett, President and CEO of DCA.

DCA offers a range of services for people with chronic kidney disease, including in-center hemodialysis care, training and support for peritoneal dialysis, and referral for transplant evaluation.

Standing Out

In a predictable business as in the dialysis industry, differentiation is the key to competitive advantage. With physicians hesitant to become a part of a large corporation, DCA needed to explore other ways of securing physician buy-in. The executive management team at DCA hit upon a business model that gained acceptance from the physicians and contributed immensely to their success. “With DCA, physicians were offered a wide range of strategic business alliance options, primarily structured as joint ventures,” clarifies Mr. Everett.

At the core, what makes DCA an attractive choice is its strong physician focus. “We offer our physicians 100 percent medical autonomy,” says Everett, adding “We believe that if we have top-shelf physicians, we don’t need a Chief Medical Officer or a Vice-President to monitor their work.” This understanding is reflected in DCA’s policy of entrusting decision-making authority, for patient treatment, solely in the hands of physicians.

Another element of the company’s success lies in its staffing model. The DCA patient-staff ratio stands at a healthy three to one. The obvious cost implication of the staffing model is offset by the returns. “With our staffing model, we are able to have the lowest turnover rates in the industry, very high levels of patient satisfaction, and are successful in attracting new talent.” says Everett.

Measurable Success

Everett believes that the physician-centric care delivery system and the staffing model have contributed hugely to the quality indicators at DCA, which are at par or better than its competitors and the national average. In the 4th quarter of 2006, Kt/V level, which measures the amount of dialysis delivered to the patient, was greater than 1.2 in 95% of the patients at DCA as against 91% of dialysis patients reported by CMS. DCA also has in place a comprehensive Continuous Quality Improvement program to ensure clinical quality. “This is a very measurable industry from a quality perspective. Companies that offer sub-par services cannot expect to survive.” says Everett.

In an era where restructuring costs is the call of the day, DCA’s company philosophy stands rooted in improving revenue on a global basis, and not focusing solely on costs. “Companies that focus more on costs and not enough on the top line start to see deterioration in quality,” says Everett.

Challenges Ahead

Today DCA is a successful publicly owned dialysis company, but the executive management team, led by Everett, is far from complacent. The biggest challenge that DCA faces, as do other healthcare entities, is the uncertainty over the changes in the reimbursement mechanism. With ambiguity over the roll-out of the bundled Medicare payments and the implications of anticipated change in the erythropoietin reimbursement policy, outside variables are perceived as the biggest cause of concern at DCA. However, the size of DCA and the commitment of the senior management to the growth of the company will enable DCA to move expeditiously and efficiently to market changes, according to Everett.

DCA’s dialysis facilities have a warm and friendly environment. “The idea was to create something special, a home away from home for the patients who spend a great deal of time here,” says Everett. Each facility is built around the patient, and that has contributed to high patient satisfaction levels – both clinical and experiential.

“Think about a dialysis patient who spends four to five hours a day, three days a week, essentially for the rest of his life, sitting on one of our chairs. We, as the provider, have a huge responsibility to that patient. That responsibility is paramount to what we are here for, as a company,” affirms Everett.

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