Back on track: technology helps doctors turn spine surgery into outpatient procedure.

AFTER more than 8,000 spinal surgeries under his belt, Dr. Robert Bray had more than a few ideas about what he'd like to see in his dream practice.

And technological advances in the last five years that can enable intricate, minimally invasive surgery to be performed outside a hospital gave Bray his chance.

Last summer, after spending $12 million to renovate an empty office building in Marina del Rey, stocking it with hundreds of thousands of dollars worth of state-of-the-art equipment, working out partnerships and convincing more than 20 medical professionals to join his experiment, Bray opened the D.I.S.C.--Diagnostic and Interventional Spine Care--integrated surgical center.

Staff at the 55,000-square-foot facility can turn what was once a multi-day hospital stay into a time- and cost-efficient outpatient procedure. While the bulk of his patients still pay cash, Bray said, the hybrid surgi-center also became cash-flow positive in January, ahead of schedule. And his administrative overhead is so low that the actual cost is prompting favorable attention from private insurers.

One sticking point: the way D.I.S.C. conducts patient treatment in an outpatient setting is so different from conventional methods that the proper billing codes don't really exist. Noting that the center's records system was set up to provide rich data for clinical trials, Bray said he also expects payers will want to see more patient outcome evidence before adding it as a provider.

"I wanted to enable the personal attention that is all-too-often missing in the health care industry today along with the access to the latest techniques and equipment," he said. "I'm hoping that payers will see the value and efficiency in patients being able to get seamless care under one roof with a team of specialists working together."

D.I.S.C.'s medical staff includes spinal and orthopedic surgeons, pain management specialists, chiropractors, physiatrists (physical rehabilitation), and psychiatrists. Using an integrated medical records and referral system that Bray had a company create for him, a patient can come in for evaluation and often get non-surgical treatments, such as a spinal block, in the same visit. Surgical patients also are treated and released the same day.

Part of what makes that possible is technology that Bray helped develop. The Baylor College of Medicine graduate was the founding director of the spine program for Cedars-Sinai Medical Center, and is a longtime clinical investigator as well as the holder of several surgical-related patents.

The pride of his personal digital operating room--one of three operating rooms--is a huge Zeiss Pantera surgical microscope that he helped develop. He uses it to perform intricate spinal procedures while making only tiny incisions. Such equipment is in part why patients are able to go home to recuperate a few hours after surgery.

In addition to Carl Zeiss Inc., Bray also has developed corporate partnerships with other medical device makers that not only given him cost-effective access to the latest equipment, but is establishing his center as a training facility. Cameras and monitors in the operating rooms not only enable the patient to watch the surgery if they desire, but also other physicians, either from on-site conference rooms or remotely.

British endoscopy equipment company Smith & Nephew plc has a $3 million equity investment in the venture. The U.S. subsidiary of Germany's Siemens AG has provided the center some of its latest digital imaging equipment even before some larger, more established institutions.

And surgical and pain management equipment maker Medtronic Inc. has designated D.I.S.C. as a training center. Bray's doctors also are participating in clinical trials for a shock-absorbing spinal stabilization implant developed by Medtronic, one of two trials under way at the center.

Bray also established partnerships with two neighboring hospitals to refer patients who may need more intensive care. The Marina del Rey campus of Centinela Freeman Medical Center operates a sports rehab and medicine clinic at D.I.S.C. In addition, D.I.S.C. also has a relationship with St. John's Health Center in Santa Monica, where Bray serves as medical director of Saint John's Spine Institute.

"Their approach to medicine, multiple specialties operating in an integrated, patient-friendly environment, is very much in line with our model at the hospital," said Lou Lazatin, St. John's chief executive.

Another challenge Bray experienced in setting up the center was its ownership structure. Federal and state law strictly regulate non-physician ownership of physician groups and surgical centers, and restrict how doctors can refer patients to facilities they own. While all of D.I.S.C's physicians have an equity stake in the business, Bray knew he needed greater flexibility to make his integrated medicine concept work and eventually open other centers.

A team at the law firm of Shepherd Mullin Richter & Hampton led by partner Bob Spanlotti worked out a single-integrated medical group structure for the center, similar to the medical group subsidiary of Kaiser Permanente, that Spanlotti said should stand up to regulatory scrutiny.

At least one of Bray's recently recruited surgeons says D.I.S.C.'s integration works even better than the Kaiser model. "I was really attracted by the multi-disciplinary approach with state-of-the-art equipment under one roof," said Dr. Sanjay Khurana, who came from a San Diego Kaiser facility. "In this setting there are really no hurdles to getting the patient treated quickly."