Big Dreams   
Sleep HealthCenters^® is hoping to establish a national network of outpatient sleep medicine clinics.

Sleep HealthCenters^® (SHC) opened its first clinic earlier this year in Bedford, Mass. The Bedford site is the first of what CEO David Barone hopes will be the nation's finest network of specialized sleep medicine outpatient clinics. The sleep centers will diagnose a variety of sleep disorders and provide services such as continuous positive airway pressure (CPAP), CPAP compliance management, oral appliance therapy, surgical consults, medication, and behavior modification.

Speaking from SHC headquarters in Newton, Mass, Barone is confident about the large market for his "one-stop shop" sleep disorder laboratory." No doubt there is a dire need for outpatient clinics that not only can diagnose, but also can treat and support patients with sleep disorders - all under one roof," Barone says. "There also is a need to coordinate provision of care for sleep disorders that is designed to meet patient, physician, and managed care expectations for customer service, quality, and cost - effectiveness. For these reasons, SHC is truly unique."

SHC President Stanley M. Goldstein believes his company has the business plan for success. "Most [sleep clinics] provide only diagnostic services-a $750 million market in 1997 - but do not capture any portion of revenue for sleep therapeutics. Given that an estimated 30 million Americans are going undiagnosed and untreated, we believe the need for diagnosing and treating sleep disorders - such as sleep apnea and chronic insomnia - is significant," Goldstein says. "Therefore, at each of our clinics, we are expanding the traditional range of services from primarily diagnostic to include all pertinent therapeutic regimens, delivered by a multidisciplinary team of experts in the field of sleep medicine."

Partnering with Established Hospitals

Barone is quick to point out that he is not starting from scratch. Instead, he explains that SHC is entering into relationships with existing hospital sleep disorder programs that are already affiliated with well-respected institutions. "We expand the programs considerably and add additional diagnostic services and treatment services," Barone says. "We provide the resources to further expand the whole program and create a comprehensive service that, in most cases, doesn't exist today."

Since the opening of the Bedford clinic, SHC has opened two more clinics in Newton and Denver. In the case of Bedford, SHC took the outpatient facility originally located on the McLean hospital campus in Belmont, Mass, and moved it to a nearby community where it could provide a "better physical setting." SHC's second facility in Newton is affiliated with Brigham and Women's Hospital of Boston and is located "off campus." In Denver, the facility is on the premises of the National Jewish Medical and Research Center.

By combining diagnosis and treatment under one roof, Barone hopes to consolidate what he calls the "fragmented" US market. "The people that provide therapies, whether they are home health care companies or ENT surgeons, have very little interaction with each other and very little interaction with the sleep center," he says. "The patient essentially has to move through the process by himself and no one feels fully responsible for the patient because everyone is just seeing a small segment of the overall care.'

Through SHC, Barone hopes to quiet critics who say laboratories are too slow and overcrowded to provide timely service. "Our goal is to have 90% of the patients diagnosed within 3 weeks," he say. "That's our standard."

Lessons from Israel

SHC has learned a lot from Sleep Disorders Centers Ltd (SDC) in Israel-the largest provider of sleep disorder services in that country. Through an exclusive agreement, SDC has shared comprehensive clinical and case management protocols with SHC. These invaluable "best practices" have helped SHC develop a framework for success.

"SDC Israel is a 100% managed care market. They've worked effectively with managed care by demonstrating and developing comprehensive protocols to manage patients-not only to diagnose patients, but to measure outcomes," Barone says. "By managing the patient all the way through from the diagnosis through the treatment and ongoing care, they're able to demonstrate true outcomes. SDC started to measure outcomes before people here had invented the term- which is now the buzzword of the industry."

SDC showed Barone how to integrate multidisciplinary physicians and work in conjunction with academia. Combine all this with measured outcomes and Barone believes you gain the credibility that is the key to managed care reimbursement. "From the payor's point of view, they're seeing a front-loaded system where they're paying lots of dollars for diagnosis," he says, "but the majority of patients are not getting the ultimate benefit - which is getting better."

Still, the proper "physical setting" is often the key to making the patient feel comfortable and, thereby, getting accurate results. Proponents of home-based sleep studies say that patients will most likely feel the most comfortable in their own homes. Recognizing the validity of this argument, SHC has designed "residential-looking diagnostic suites" that Barone says look like "nice hotel rooms."

Greg Thompson
Home Health Care/Provider
September, 1999