Tuesday , December 11, 2018

October 2013

Featured In This Issue

October 2015


     “Service with a smile” has been a core precept of American businesses since the beginning of the last century. Research shows that smiling correlates positively with attractiveness and likability between humans. In fact, smiling correlates with greater trust, increased financial earnings, and enhanced interpersonal cooperation.

     A smile conveys respect, patience, empathy, hospitality and compassion. For example, when an employee smiles at a stressed customer, and exhibits excellent listening skills, most of the time, there is a report of total satisfaction.

     Research also reports that people receive more help when they smile. Even the smile of a stranger produces more “Good Samaritan” effects on the receiver. Neuroscience research shows that a smile enhances others’ memory retrieval of the person’s name.

     “Smiling is how we build trust in business and rapport in relationships. The ability to smile with confidence is foundational to self esteem,” maintains Dr. Christian Yaste, and is ultimately what led he and Dr. Joseph Hufanda to create the Ballantyne Center for Dentistry in 2001.

     “Everything starts with a smile,” contributes Hufanda, who says he knew in high school that he wanted to be a dentist. Both his parents were in the medical field, but he had a creative streak. He figured cosmetic dentistry would allow him to be in the medical field and be creative and artistic.

     “I have an avid interest in fine arts, music and painting. I firmly believe my art helps me with the artistic side of dentistry,” he says.

     Yaste, whose friendship with Hufanda dates back to middle school, had a more abrupt realization. While in dental school at the University of Michigan, Yaste had a bicycle accident on black ice which cracked off his front teeth. The care he received gave him back his smile, but left him disillusioned with “old school” dentistry and its lack of empathy.

     “If dentistry meant pain, I wanted out. I did stay the course, but committed to offer patients a totally different experience—one that’s friendly and comfortable. I want them to feel cared for and cared about and I want them to get the smile they have always wanted,” affirms Yaste.

     Both Yaste and Hufanda finished their graduate studies at the University of Michigan School of Dentistry, but Hufanda trained at the Upper Peninsula Rural Health Services while Yaste began a two-year residency in Oral Medicine here at Carolinas Medical Center.

     It didn’t take long for Yaste to convince Hufanda to join him in Charlotte and the two spent three years working at a general dentistry group practice in town.

     “We were seeing a lot of adults—baby boomers—whose needs weren’t being met through general dentistry,” describes Yaste. “We decided we really wanted to focus on that niche market sector.”

     So the two set up their own practice in Ballantyne to provide expert care using the latest techniques in cosmetic and restorative dentistry in a spa-like setting with a focus on health, wellness and beauty all under one roof.

     “At the Ballantyne Center for Dentistry, we’ve helped thousands of patients achieve the smile of their dreams…affordably, quickly and comfortably,” smiles Hufanda.


Focus on Adult Needs

     Ballantyne Center for Dentistry has become a destination for patients with cosmetic or restorative needs. The doctors’ expertise draws patients from both Carolinas and other parts of the country.

     “Many baby boomers finally have the time to focus on themselves,” says Yaste. “They want a comfortable, relaxing environment where they can improve their smiles for social or career reasons. We’ve noticed a lot of men coming in saying they’ve got to keep up with the 30-year-olds who look like G.I. Joe in their office.”

     With a full array of offerings including veneers, bonding, tooth whitening and the speed of CEREC technology (which can allow the custom crafting and fitting of ceramic restorations in one visit), the Center has options to fit varying needs.

     Their Six Month Smile system allows adults with a good bite but crooked or gapped teeth to unobtrusively correct their smile without the time or expense of traditional orthodontics geared toward children.

     “I smile a lot more than I used to,” attests patient Colin Pinkney after improving his smile at Ballantyne Center for Dentistry. “It feels good to smile. I think the world of Dr. Yaste and the whole dental family here at Ballantyne Center. Every nurse, every assistant, every person in this office is just incredible and I love coming here…They truly do work miracles.”

     Tooth loss is also a major problem for adults. “The denture adhesive market is a billion dollar industry,” explains Hufanda. “Dental implants can replace one tooth, several teeth or provide anchor teeth to help with denture slippage.

     “For someone who has had full dentures and who worried that their dentures might come out while they ate or that they might not be able to chew something, implants can be a life changer. Patients can go out and eat again. They can eat salad; they can have a steak.

     “And the treatment has improved. In some cases, we can get done in three months what used to take a year. Now we can remove a tooth and put in the implant in the same day in one surgery.”

     While some of the tooth loss the doctors treated was due to trauma, they also found an appreciable amount caused merely by a lack of dental care, and “diagnosed” that a fear of going to the dentist was probably an underlying cause.


Nothing to Fear

     That revelation led Yaste and Hufanda to focus on dental anxiety and resulted in them expanding their practice to include sedation dentistry. Anxiety was a problem that Yaste understood well.

     “I admit I am somewhat of a dental phobic, ever since my bicycle accident,” Yaste confesses. “I can empathize with my patients that are afraid of the dentist. When patients know I feel the same way, it helps them get through it. Sedation dentistry allows people to get the dental care they need or want without the fear and pain they’ve experienced in the past.”

     Both Hufanda and Yaste are certified in oral sedation by DOCS (Dental Organization for Conscious Sedation). The protocol they follow involves an oral sedative that puts patients in a calm, relaxed but conscious state where they feel no anxiety or pain. Some patients are so relaxed they drift off to sleep.

     A patient will need a ride to and from the office but beside the obvious benefits, sedation dentistry can allow doctors to condense treatment that might take three to four visits into one.

     The use of drill-free laser dentistry can also ease patients’ dental anxiety. With this technology, lasers remove decay and prepare teeth for fillings, root canals and gum surgery. All a patient feels is a light flow of water over the teeth and a soft clicking instead of the pressure and fear-triggering sound of drilling.

     Treating people with dental anxiety has become such a specialty for Ballantyne Center for Dentistry that other local dentists refer their patients with dental phobia to the practice for treatment.

     “We want to help these folks,” Yaste emphasizes. “We have a solution. We even offer a patient their first sedation for free so they can see what it’s like to be able to go to the dentist without fear.”

    “When I was a kid, dentistry hurt. It just came with the territory,” says WBT morning radio personality and patient John Hancock. “I spent most of my adult life avoiding the dentist because of my dental phobia. I heard about Dr. Yaste and Dr. Hufanda. I heard that they were miles ahead in both the art and the science and that it didn’t have to hurt.

    “I was amazed at the care I got from Dr. Yaste, Dr. Hufanda and their staff. They took my overwhelming dental problems and fixed everything without pain!”

     “We’re constantly looking for ways to improve the experience of our patients,” adds Hufanda. “We want to stay in the forefront of technology to find what benefits our patients and at the same time, helps our practice to grow.”

     Interestingly, that state-of-the-art compulsion has pushed the doctors into another related area—treating people with chronic headaches and migraines.


Solving Your Headache Pain

     Every day, dentists encounter patients who chew, grind, tear, and work their head and neck muscles as strenuously as athletes. The significant forces generated by clenching, grinding, and bruxing put the mouth and masticatory system under constant stress.

     Such stress and improper dental forces associated with the muscles, nerves, tendons, and ligaments contribute to a number of symptoms, including chronic headaches and migraines. Other symptoms include temporomandibular joint disorder (TMD), excessive tooth wear and/or breakage, tinnitus, clicking and popping of the jaw (TMJ sounds or vibrations), and discomfort or pain in the head, neck, face, or jaw.

     “Symptoms can also often be caused by macro trauma, like biking or automobile accidents, or micro trauma, such as from wisdom tooth removal or orthodontia,” suggests Yaste.

     “Sports medicine technologies, such as low-level laser therapy, therapeutic ultrasound, and microcurrent nerve stimulation, have been used successfully for years to improve athletes’ recovery from musculoskeletal and force-related injuries,” explains Yaste, “and now such innovative approaches to treatment are being applied in dentistry.”

     Drs. Yaste and Hufanda have embraced a patented pain relief technology called TruDenta to provide relief from headaches and migraines for their patients, branding themselves Charlotte Headache Doctors.

     “TruDenta is a state-of-the-art system for the diagnosis, treatment, and management of functional, dynamic force imbalances within the mouth. Utilizing a combination of sports medicine rehabilitation and advanced dentistry technologies cleared by the FDA, it can produce lasting relief and dental foundation rehabilitation for our patients,” describes Hufanda.

     “This is a way to successfully and predictably treat migraine, headache, TMJ and other conditions like tinnitus,” enthusiastically explains Yaste. “It revolutionizes how headaches are treated; this system allows us to treat the problem without medications.”

     “Several treatment protocols are available,” continues Yaste. “We might use cold laser or orthotics or we might re-map a damaged neural pathway. It depends upon the diagnosis. The correct protocol is determined by the diagnosis and the system uses comprehensive and objective screening tools to get an accurate diagnosis.

     “Treatment can take from two to 12 weeks and it has a very high success rate. I started treating patients a year and a half ago and currently we’re treating about four or five headache patients a week. But the whole practice has grown. In 2012, we had our best year ever. We’ve gotten so busy, we’ve had to bring in a new doctor.”


Staffing Up to Meet Needs

     Dr. Teresa Mercado has recently joined the Ballantyne Center for Dentistry team after 16 years’ running her own practice in California. Mercado has experience in general, cosmetic and sedation dentistry and she, like Yaste and Hufanda, is trained and certified in the TruDenta system.

     “By bringing on Dr. Mercado,” Yaste explains, “we can care for more people. We can handle our growth and still give our patients the same high level of care they’ve come to expect.”

     “Dr. Mercado rounds out our team,” Hufanda adds. ”She also brings a woman’s perspective to our practice.”

     Ballantyne Center for Dentistry’s growth has also led the doctors to add 1,000 square feet to their second floor office suite in the Ballantyne Commons East Shopping Center and expand business hours for patient convenience.

     They’ve also added a significant new technology: a CT (computerized tomography) scanner.

     “From a diagnostic standpoint, it’s invaluable,” says Yaste. “It allows us to view a person’s entire head and face in three dimensions. We can find things we never saw on an X-ray. I now have more information available to me before I do a procedure, like where a nerve is or how much bone there is in a particular area.”

     The CT scan was especially beneficial in the case of a recent patient. “A gentleman came into the practice for a dental implant and the CT scan we did revealed a golf ball-sized tumor on his upper jaw next to the sinus,” Yaste describes. “He had the tumor removed and luckily it was benign, but it was growing quickly and was potentially disfiguring. He could have lost his front teeth and part of his jaw. This tumor didn’t show up in a traditional x-ray.”

     Both Yaste and Hufanda attribute the success and growth of their practice to many factors: keeping their eye on the trends in care and the business of dentistry, their relationships with mentors and influential industry leaders, and their eagerness to learn new techniques and procedures and implement them.

     “We are incredibly teachable,” jokes Yaste.

     They also list their ability to do most procedures, including root canals and other oral surgeries in-house, as a major differentiator for their practice. “We focus on the whole mouth,” explains Yaste. “We rarely need to refer a patient. We do almost everything here.”

     They also work with patients to maximize their insurance benefits and have relationships with several financing companies to assist patients in obtaining needed or wanted dental care.

     “Patients’ objections to dental care are fear, time and money,” says Yaste. “We’ve found ways to help patients with all three. There’s a book we keep in the waiting room filled with grateful letters that patients have written to us.”

     “Gratitude like that is very rewarding to us,” says Hufanda. “It’s our passion and our nature to help as many people as we can. There are so many people out there hurting. They’re in pain, whether psychologically from an unattractive smile or whether from debilitating headaches. Our goal is to help those people. We truly give service with a smile.”


 Photo by Fenix Foto

     When Paul Franz of Carolinas HealthCare System (CHS), a vast organization of 30-plus hospitals and 600 care locations, first interviewed Derek Raghavan in late 2010 to potentially head up the multimillion dollar cancer center they were building, he had no idea the precocious doctor would turn the tables on him.

     Raghavan was one of a handful of prominent oncology program administrators that CHS had carefully culled as being up for the task. Raghavan was at the time director of the Cleveland Clinic Taussig Cancer Center where, after seven years, he had raised its ranking by U.S. News & World Report from No. 46 to No.9. He wasn’t looking to change jobs.

     Yet, by his own admission, he had started thinking more globally about ways to get patients into clinical trials, removing barriers to access to care, eliminating perverse incentives that influence treatments that doctors recommend.

     Raghavan came for the meeting anyway. It was during the conversation that he had the audacity to remark to Franz: “I am not really interested in the job you’re offering, because I am not really interested in building a regional cancer center. But,” he continued, “if you want to ramp it up—to let me build you a world-class cancer center, one of the top centers internationally and also that serves the Carolinas—I would be interested in doing that.”

     In short, Raghavan was drawn to the opportunity to start with a blank slate and design the foundation and the systems on top of that, as he describes it, “building a rational cancer care system on an empty lot, based on bioinformatics tying together hospitals and outpatient clinics.”

     Franz tells it, “Derek’s eyes lit up with the opportunity, and, as you know, he can process things at 300 miles per hour. Immediately, our vision, which we thought was dramatic, Derek made 10 times bigger,” spewing “Here’s what you can do with this…here’s what you can develop here…here’s an opportunity to do this…”

     Raghavan continued to think through the implications of the Carolinas challenge, grasping some immediately and others “during shower time.” When CHS determined they wanted him to guide this mega-adventure, he accepted, starting as president of the Levine Cancer Institute in April 2011.


Building It Rationally

     Carolinas Healthcare System had been looking for the next big thing. They had successfully embraced cardiovascular services, which Franz describes as typical of most health systems in that they represented the best market share opportunity and were the most profitable service line.

     In 2007, they decided oncology made sense. They were already treating a considerable number (10,000) of new patients a year. Competition was weak— there were excellent cancer centers along the system’s boundaries, but not in its core area around Charlotte. And at the time, changes in reimbursement were weakening physician-owned, office-based practices, potentially making doctors more willing to join hospitals.

     In 2009, a CHS consultant confirmed that their patient volume was enormous and their timing was good for building a regional cancer center. Estimates for building a regional cancer center in the Charlotte area came up to about $250 million over a decade; however, given the needs of the entire system, CHS executives doubled that number.

     Construction began, made possible in part by a generous $20 million donation from philanthropists Sandra and Leon Levine of the Levine Foundation, along with tremendous support from CHS and the community. The center was to be specifically designed as a cancer care center “without walls,” the coordinating center for a series of integrated cancer care centers throughout the system.

     Opened in August 2012 and boasting 171,000 square feet of space in a stunning six-story architectural magnum opus, the facility certainly appeases those concerned about the aesthetics of the Charlotte landscape, but more importantly provides nine cancer clinics, infusion therapy, radiation therapy, palliative care and a Phase I clinical trials center, all under one roof.

     In addition to containing the most progressive clinical modalities and equipment to treat rare and complex cases, it also serves as the springboard for a clinical trials and research division and community education initiatives.

     It is this level of dedication and commitment to improving the patient experience and outcome that makes the Levine Cancer Institute so unique and on the path to becoming an internationally lauded facility. These themes were also considered a top priority in the physical design of this new space.

     It includes an Image Boutique on site, complete with wigs, prosthetics and other recommended treatment supplements. The Image Boutique goes a long way to make patients feel and look their best while dealing with some of the physical challenges overcoming cancer can bring.

     The Blumenthal Infusion Center, named in honor of the Blumenthal family who have supported cancer care at Carolinas Medical Center for years, is located on the fourth floor of the new building featuring more than 80 infusion chairs in a peaceful and caring environment. There are also mind/body wellness programs and a healing rooftop garden available for patients.

     “Cancer care includes much more than just diagnosis and treatment of the disease itself,” explains Raghavan. “Cancer affects every aspect of a patients’ life and one of the goals of Levine Cancer Institute is to broaden the scope of cancer research, prevention, treatment and survivorship to reflect the full impact of cancer on our patients and community.”

     So far, the system has spent $50 million in building the cancer center and another $20 million on renovations and recruitment.


A Man with a Vision

     Raghavan is a medical oncologist who came to the U.S. from Australia in 1991, which may be why he sees our health care system with the clarity of an outsider. His reputation is built largely on years of service on the FDA Oncologic Drugs Advisory Committee (ODAC), where he became known as “the sort of guy you don’t want to match wits with.”

     In one cancer journal, they say “His precisely aimed, lethal, Australian-accented remarks had, on more than one occasion, trashed cooperative groups, pharmaceutical companies, and the National Cancer Institute (NCI) itself.

     They are on point in describing his temperament: “Raghavan’s brand of humor would be better described as aggressive truth-telling. His delivery if perfectly deadpan. Indignation seems to affect his face like a dose of Botox. It’s possible that the guy laughs, but this has not been observed in public. Raghavan claims to be unable to retrain himself when an absurdity materializes within striking distance.”

     Indeed, Raghavan unabashedly admits, “I am deficient in self-control,” proud that he “says stuff most people would rather not.”

     Even though his tenure on the ODAC committee ended long ago, the agency keeps inviting him to return. “One of the most attractive features about ODAC is it doesn’t have lawyers on it, so we can actually think about patient welfare.”

     In selecting Dr. Raghavan CHS graced Charlotte with one of the most brilliant minds in the world of cancer care.


Building a Coalition

     One of Raghavan’s first challenges in accepting the position at Levine Cancer Institute, was to reach out and engage the medical community to identify common interests and areas of cooperation and collaboration. That included recruiting key physicians to complement clinical strengths in Charlotte and beyond.

     Raghavan reached out to the local community. Physicians like Kathryn Mileham of the Mecklenburg Medical Group graciously accepted because, “They gave us an opportunity to mold our future. Each physician had an opportunity to say, ‘I have an interest in a particular cancer,’ or ‘I prefer to maintain my community focus…without having to subspecialize.’

     “We were given the opportunity and support to make those decisions on our own. Without being unwillingly channeled toward a particular focus, it is easy to maintain the energy and the excitement and the drive to succeed in providing all aspects of excellent patient care.”

     Raghavan also reached out to academic stars, willing to leave prestigious academic institutions to join the team. With a broad, world-view approach to treating cancer, Raghavan never thinks small.

     “When we started, I made a list of 50 of the top cancer physicians and researchers that I wanted working at our center. I was able to recruit 40 of them,” says Raghavan. The feat is a testament to his tenacity for achieving the best for patients; a quality that perfectly complements the Institute’s vision of “changing the course of cancer care.”

     Since he joined the staff two years ago, Raghavan has recruited 82 specialists altogether. Mike Tarwater, CEO of CHS, attests to Raghavan as a “skilled recruiter, bringing some of the nation’s most gifted and talented oncologists to our region.”

     Raghavan says, “I basically wanted to bring in the very brightest people who weren’t jerks.”

     In truth, he wasn’t kidding and simply demonstrating his frank and often unintentionally humorous candor that is such a large part of his charm and unassuming persona. Perhaps most importantly, his belief that “the team trumps the individual” is both genuine and a mandate for his staff.


Raghavan’s Health Care Initiatives


     •Access to and Consistency of Quality Care. “We want to make access to cancer care easier for all,” says Raghavan. “Our physicians work with each patient to determine a personalized care plan based on their needs.” Using symmetrical access to care with a system-wide approach, Raghavan and his team utilize a de-centralized model of treatment and support which provides state-of-the-art care distributed evenly.

     That’s a hot button for Raghavan who explains, “The quality of care should use an integrated approach and be the same where ever you go in our system. A patient in Greensboro should have the same standard of care available as a patient in Fort Mill, or in Charlotte.” To that end, the Institute has a large and growing network of 12 charter member hospitals to ensure quality cancer care is delivered at each facility across the Carolinas.


     •Patient Participation and Navigation. Raghavan also puts a high premium on patient participation in treatment plans and outcome goals and is not satisfied to let them sit idly by as others make decisions for them. “I believe in treating cancer by engaging patients as part of the team so they know they can influence the outcome,” he says.

     The Institute offers patient navigators who play a vital role in helping patients find specific cancer services including different types of clinical trials and cancer registries, as well as clinical and support therapies, such as clinical modalities, grief consultation and survivorship, and palliative care. Working in tandem they help guide cancer patients and their families through their journey of healing and transition oncology care to the most appropriate location for the patient.


     •Caring for the Underserved. Of great interest to Raghavan and something very influential in his decision to accept the position at CHS was his profound commitment to treating the underserved. Of course that’s a polite term for the poor and those who can’t afford or don’t have access to health care. It is significant to note that in 2012, CHS spent approximately $1 billion in treating these populations.

     The breakdown includes $250 million in Medicare contracts, $250 million in Medicaid, and $500 million in caring for the indigent—money they will not recover. It’s one of the things Raghavan is most proud and he admits feeling frustrated over how little attention it gets in the media.

     “Doing altruistic work should be celebrated, and I am proud of the fact we look after this population,” he says. “The fact that we are prepared as a system to lose this amount of money from our bottom line is a testament to our commitment to providing care for everyone.”


     •Value Not Volume. As the cost of health care continues to be a top concern and albatross for the country, Raghavan was very attracted to what he characterizes as some of the “top, thoughtful” business minds at CHS who understand the need to get health care costs under control. He notes, “We are committed to helping people get better but we should be sensible in how we invest in treating patients and spend our dollars.”

     One cost-saving measure has been to consider the best treatment in terms of patient billing. If there are three treatments with equivalent efficiency and side effects, they will choose the least expensive option.

     Raghavan is also focused on moving patient care to a model based on outcomes rather than treatment options. “The algorithm has changed. It’s about value, not volume,” he explains. “Don’t choose a particular treatment because you can. Do it because it’s good medicine. We need to set constraints and be thoughtful.”

     Regarding the Institute as a microcosm of the nation’s complex health care system, Raghavan believes the underlying problems with health care can be fixed. Overall, he believes that people have some unrealistic expectations for health, government can’t afford the care we want, what consumers ask for is expensive, and that nobody wants to pay for health care. As a result, it creates monumental challenges for the federal and state governments to plan for the future.

     “We can’t make changes in health care simply by writing them down,” says Raghavan. “Sometimes we see people making prophetic statements with no skin in the game.”


Continuing to Innovate

     CHS now delivers cancer care to over 14,000 new patients a year. In less than three years the Levine Cancer Institute has literally changed the course of cancer and eliminated many of the natural barriers to top-quality care, such as distance to clinical and research sites, cultural barriers and patient access.

     From the technological spectrum, the Institute utilizes one of the most advanced wireless systems in the country. Joining forces with Accenture, it developed an app that connects with patients electronically so they don’t have to leave their home. Medical teams can also conference with other hospitals within the Carolinas HealthCare System and physicians have all clinical trials and a system of pathways for cancer care guidelines available for instant download.

     The Institute uses a holistic approach to cancer care and cancer survivorship. Part of the approach also includes financial and nutrition counseling sessions, support groups and wellness programs. Doctors and clinical teams also continue work with patients who have been cured and are dealing with the after-effects of their treatments so they can develop algorithms in that group.

     The Institute has also launched a Levine Oncology Program for Seniors at Mercy Hospital and at Stanly Regional Medical Center and are piloting the Flying Squad—a home-visit program to treat those who are remote and not well enough to visit the hospital.

     Amazing advancements in research are being made including first-in-human trials and complex cancer. Researchers have implemented unique programs to better track outcomes, drive efficiency, move research from bench to bedside quickly, and establish more accountable cancer care. Currently, there is a 12-bed monitoring unit in Charlotte and they are expanding to other sites.

     In addition, Phase II trials are underway, and a bone marrow transplant unit and a palliative medicine unit are being built. “I have had the opportunity to lift the game and increase the interplay between research and trials,” comments Raghavan.

     While many in the Charlotte region don’t even realize it, our community is now home to one of the premier cancer treatment centers in the entire world in the Levine Cancer Institute. It houses the largest single institution cancer research databases and is accredited by the American College of Surgeons Commission on Cancer and by the National Accreditation Program of Breast Centers.

     Dr. Derek Raghavan and his team are leading us into a new era of innovative, intelligent, and thoughtful cancer treatments and care. He says generously of the Institute, “What I saw here was a well-organized hospital system with the resources and seriousness of purpose to create a world-class institute. Alongside that was their preparedness to bring in national stars and their ability to provide adequate support for clinical trials and patient navigation—I just leveraged the vision they had.”

     Reflecting back, he says, “It felt like a perfect fit. And it has been more rewarding than I could have imagined.”

     Nestled away off Johnston Road in the Ballantyne area, Chelsea Therapeutics represents the next big evolution of the pharmaceutical industry. A far cry from drug giants like Pfizer and Merck, this small band of entrepreneurial-minded scientists, physicians and business executives are focused on a virtually untapped market.

     “We’re going to develop drugs for patients who represent a high unmet medical need and improve their lives,” says CEO Joe Oliveto. He refers to those historically ignored by the pharmaceutical power players because there simply aren’t enough of them.

     Chelsea Therapeutics has found its niche in what are called orphan drugs—those developed to treat rare, often little-known medical conditions or orphan diseases. By definition, the population of those suffering from orphan diseases numbers less than 200,000 and can be as little as a few thousand in the case of “ultra-orphans.”

     Acknowledging the difficulty and lack of incentive to develop and market these medications, the Food and Drug Administration (FDA) helped pass the Orphan Drug Act of 1983 to encourage the development of rare disease drugs. The act provides sales exclusivity for seven years, possible clinical trial tax incentives, and modifies Phase III clinical trial testing mandates as it literally may be impossible to test the number of patients required under current standard guidelines because they simply may not exist.


Finding Success in a Limited Population

     Leaving the humanitarian aspect alone for the moment, servicing such small segments of the population doesn’t mean there isn’t money to be made in this sector. Traditional thinking was that too few patients equaled too little opportunity for return on investment. Oliveto says that there has been a movement toward looking at orphan diseases because of the high unmet medical need and the opportunity to realize a financial return.

     Thus, a new generation of smaller companies like Chelsea Therapeutics is emerging and venturing into this underserved market. That is not to say that the big boys are content to sit on the sidelines. There are now large pharmaceutical companies that are also focused on the orphan drug space and even ultra orphan drug space which may serve only tens-of-thousands of patients.

     Chelsea Therapeutics has a mere 20 employees—specialists, really—who have come together armed with an entrepreneurial spirit and a deep passion to make an individual difference. As Rachel Couchenour, Chelsea Therapeutics’ director of medical affairs, is fond of saying, “There’s no tall grass here. There’s nowhere to hide.”

     Oliveto confirms the sentiment saying, “Here, you’re one-twentieth of the organization! You look around and realize, ‘This is it.’ You quickly find out you’re on your own and there’s not a large safety net like at the larger companies. We attract a particular mindset—risk takers and entrepreneurs.”

     Chelsea Therapeutics was founded in Charlotte in 2004 by Simon Pedder, Ph.D., who remains engaged with the organization in the role of consultant. Oliveto jokes that Pedder, who lived in Charlotte at the time, was simply tired of his then weekly commute to New Jersey. More seriously, Pedder saw Charlotte as an excellent location to start and grow a company—a place where one could attract other key players to live and work.

     Oliveto notes, “I’ve worked in places where nobody wanted to come, even when the job was a great one. We don’t have that problem here in Charlotte.”

     Pedder worked to assemble a group of investors and took the company public almost immediately as part of the initial business model. In the last year Chelsea Therapeutics watched its stock (NASDAQ: CHTP) jump over 200 percent from trading below a dollar to north of $3.00 per share as of late September.

     The company has high hopes of celebrating its 10th anniversary in 2014 with FDA approval of Northera (droxidopa), a drug developed for the treatment of neurogenic orthostatic hypotension (nOH), a condition that can affect patients with underlying neurodegenerative disorders such as Parkinson’s disease, multiple system atrophy, and pure autonomic failure. Basically, nOH causes a consistent drop in systolic blood pressure causing a myriad of problems including lightheadedness, dizziness when standing, and generalized weakness.


Bringing Successful Drugs to the U.S. from Abroad

     Droxidopa was initially developed by the Japanese company Dainippon Sumitomo Pharma Co., Ltd. Chelsea Therapeutics acquired the global development and commercialization rights to droxidopa (save Japan, Korea, China and Taiwan) in 2006.

     Granted orphan drug status by the FDA in January 2007, Chelsea believes Northera has the potential to be the first safe and effective drug that will treat symptomatic nOH without leading to significant supine hypertension, thereby improving the quality of life for patients suffering from the disorder.

     One of the challenges for companies in the orphan drug space is the difficulty of accurately assessing how many patients suffer from a given orphan disease due to the extreme lack of data and studies available. Regarding nOH, Oliveto says, “While it’s hard to pinpoint an exact number, we anticipate about 10 percent of Parkinson’s patients are suffering from the disorder and believe the overall number of patients suffering from symptomatic nOH to be around 140,000 to 150,000.”

     With such a small potential population of users, the obvious question becomes the price tag. It would seem inevitable that orphan drugs would be more expensive than their mass-produced counterparts.

     “Usually that’s the case,” responds Oliveto, “because you have to make your money back at some point and show a return.” But he also points out that Congress understands the need for incentives and through the Orphan Drug Act eliminates user fees normally paid to the FDA to help fund the review of new drug applications.

     Often, a foreign company lacks the capacity to navigate the FDA’s roadmap to drug approval and that keeps an orphan drug out of the U.S. market. In the case of Northera, in 2006 Dainippon Sumitomo simply did not have the infrastructure in place to understand FDA regulations and procedures.

     Oliveto explains, “This underutilized gem was serving patients well in Japan for years, but no one had the resources to bring it to the U.S. This is the niche that companies like Chelsea Therapeutics have significant opportunities to step in, license the drug, see it through FDA approval, and ultimately get it to market.”

     Currently Chelsea Therapeutics is in Phase III (final confirmation of safety and efficacy) of the FDA clinical research process for Northera as a treatment for symptomatic nOH. The FDA Cardiovascular and Renal Drugs Advisory Committee voted to approve Northera in February 2012 and the following March the FDA asked Chelsea Therapeutics to submit data from an additional study.

     The company resubmitted a New Drug Application (NDA) in August of this year and in September the FDA officially accepted the NDA resubmission.

     None of this is new to Oliveto, who has played a significant role in the success of multiple NDA filings during his tenure with Hoffmann-La Roche. To hear him describe it, the process seems exhaustively complex: “I have seen semi trucks full of boxes and boxes of paper heading to Washington, all to try to get approval for a single drug.”


A Defender of the FDA

     Yet, Oliveto remains a fierce defender of the FDA, noting that while it is not uncommon for NDAs to be rejected during their first review, he believes the rigorous procedures and practices are anchored in a genuine desire to protect the public. He also characterizes the Administration as progressive in their efforts to safely expedite the delivery of new drugs to market and sympathizes with their plight, explaining that from his perspective, the FDA is at a disadvantage.

     While it may take a drug company a decade to prepare and assemble hundreds of thousands of pages of data regarding a new drug, the FDA has only one year to review it—or in the case of orphan drugs—only six months. Chelsea Therapeutics’ FDA decision date on Northera, known as the PDUFA date (named for the Prescription Drug User Fee Act), is Valentine’s Day 2014—a day Oliveto hopes will be a very special day for those who suffer from nOH.

     “When you’re a company as small as we are, and as focused on one disease, you really take the unmet medical need personally,” notes Oliveto. “The patients’ needs are both heartbreaking and the ultimate motivator to achieve success. We never forget for a day what our goal is and who we are fighting for. Their pain and suffering is never lost on a single person here. We are all about the patients and improving their quality of life.”

     Unfortunately, for participants, at some point the clinical trials end. When the Northera clinical trials ended, patients contacted Chelsea Therapeutics requesting continued access to the drug. Oliveto explains, “When the drug has worked well for patients, it’s hard to go back to a life without it. These are heartbreaking stories and the patients become very vocal.”

    Vocal patients have become an important part of the learning process for the company and potentially the FDA. Oliveto notes, “Unless you really understand the patients and what they’re going through, you don’t have much hope of being successful in developing the drug.”

     Fortunately, through the support of the patients’ treating physicians, Chelsea Therapeutics has been able to provide Northera through an expanded access program allowed by the FDA.

     Chelsea Therapeutics has also been conducting Phase II trials for the use of Northera to treat fibromyalgia and intradialytic hypotension (IDH), the latter of which can preclude the delivery of adequate doses of dialysis for patients with kidney disease. Another compound, CH-4051, is in Phase II development for use in the treatment of rheumatoid arthritis.

     For Chelsea Therapeutics, 2014 stands to be a game-changing year. A development stage company for the last nine years, Oliveto and his team hope to make the successful transformation into a commercial stage company active in production, marketing and sales. If that happens there will be no shortage of larger companies, stressed to fill their commercial pipelines, who will aggressively come knocking.

     While not part of their original business model per se, Chelsea Therapeutics has been very open publically and with investors that they are seeking and evaluating opportunities for partnerships with other companies, and even prospects for acquisition.

     Oliveto says, “The only thing that’s for certain is that we will not stay the same. We will grow.” He adds, “It is certainly possible today for a small company to come to the orphan market, where they’re not competing with the Pfizers of the world, and actually grow and commercialize a product.

     “But for us, everything is on the table and we have to return value to our investors. Ultimately, we are about getting the drug to the patients. Whatever is the best path forward to accomplish that goal is what we will do.”

     Like trickling rain, binary numbers drop and slide onto the fabric of life, forecasting every possible sequence into infinity. Most participants, mesmerized, will experience the steadfast order; a single reality that can be taken for granted. A rare few will perceive the development of alternate realities—situations arise, problems are clarified; solutions become evident.

     Such was the backdrop for the movie, The Matrix. The ability to “see the matrix” allowed for insight and understanding, quick responses, survival itself and a new order.

     “I relate to that,” says an enthusiastic Troy Rice, owner and president of See the Matrix Incorporated, a Charlotte-based IT company. “With us IT guys, well, we often live in an alternate universe with the way we think, talk and look.”

     Rice also relates this theme to his business. “We see through a different set of lenses. We look into a mess of wires and problems and make sense of it.” And that’s a good thing for his clients whose computer woes often seem otherworldly.

     See the Matrix, or STM for short, provides, hosts, maintains, monitors and supports hardware, software, licensing and antivirus protection, allowing its clients to focus on their core business operations and goals.

     Work with small to mid-sized businesses in the Charlotte area comprises about 65 percent of the company’s activities, although the growing client directory is scattered over 18 states as well as in satellite offices abroad.

     “Entrepreneurial, professional-based businesses such as accounting, legal and medical gravitate towards STM,” says Rice. “Their software works really well with our platform, plus they tend to have multiple offices with a small number of users in each one.” Rice adds that that’s because companies with 50 or more users at one site likely have their own on-site IT person.

     STM is currently managing services for approximately 2,200 users. Clients include James McElroy & Diehl, one of Charlotte’s biggest law firms, and Adams Outdoor Advertising. Assisted living communities and small hospitals round out the company’s client base. Rice admits that there are businesses too big for the company.

     “We can’t really offer anything to Wells Fargo, but we can go to smaller businesses and offer them the same enterprise-level services that Wells Fargo utilizes,” maintains Rice. “We have the same quality and level of equipment sitting in our data center that Fortune 500 companies, banks and large hospitals have.

     “Businesses that have been frustrated with a too-small IT operation lacking in immediate response or face the option of working with a larger firm but at prohibitive costs—these folks are attracted to us. We operate on a flat-priced model; rates are based on the number of users and pieces of equipment.”

     One of the company’s largest new clients came on board earlier this year—a small hospital in New Orleans with over 100 users. “That was an amazing project that couldn’t have been done without the right group working on it,” says Rice.

     STM’s vendor partners include Cisco, EMC, Dell and SonicWall. Rice likens the process of bridging vendors to customers to building a house. “We buy the best brick, wood, tile, shingles, paint and nails that are available to build a structure; then we sell the house.” See the Matrix earned $2.5 million in revenue last year.


Living in the cloud

     “Customers ask, ‘When are we going to the cloud,’” says Rice. “I tell them, ‘You’ve been in it for eight years now.’” See the Matrix was far ahead of the curve, according to Rice. “We’ve been doing it longer than anyone else in Charlotte; before it had a name; before it was cool.”

     The cloud is a relatively new delivery paradigm making information and services accessible at any time from any location and from any device such as desktops, laptops and smart phones. Through the cloud, data lives and runs on multiple and highly-redundant servers in locations external to the data owners.

     “Why in the world would a company today want to have its data on a server in an office when its whole business life is dependent upon that server and subject to mechanical or electronic failure, theft, damage, accidental deletions or power outages?” ponders Rice.

     See the Matrix owns a private data center in the TW Telecom Data Center near Charlotte-Douglas International Airport. All client data is stored there on an EMC SANS appliance and applications are run from an array of redundant servers. STM utilizes TW Telecom’s conditioned power and generator, preventing downtime from loss of power. The company utilizes a triple entry fiber Internet service to insure constant connection.

     “Jack Bauer [referring to actor Kiefer Sutherland’s character in the television show 24] couldn’t get into the place. There are nine layers of security before you get to a computer over there,” boasts Rice, describing the facility on which blinds cover, not windows, but more concrete. The unmanned data center is located 3.7 miles from the company’s West Morehead Street offices.

     The constant monitoring and probing of the network systems is conducted by the STM staff. Annual upgrades are supported by Varrow, Inc.

     “We finished an upgrade about 60 days ago,” says Rice. “It came off without a hitch and no one [customers] knew. That’s the way it’s supposed to be—no lapse for the customers, just seamless backups, faster retrieval and advanced security.”

     Downtime is the ultimate nemesis for most businesses, according to Rice. “We work to make sure that computer problems don’t stop your operation in its tracks.”


A bright and capable team

     The STM team consists of 12 full-time employees.

     “I am blessed with a great staff,” shared Rice. He speaks of Travis Nieves, his director of operations: “Together, we manage the data center. He’s the hardware guy; I’m the money guy,” laughs Rice. “We often act on ideas Travis brings to me because his ideas make sense to further our products and the stability of our program.

     “Tim Bailor is senior systems administrator and has worked with the company for over 10 years. He’s kind of my McGyver,” says Rice. “He’s sat at every desk here.”

     The company’s on-boarding manager is Mat Schulz. He acknowledges,“It’s a massive undertaking to bring a customer with 25 users on board—two weeks of work for us, then a 24-hour switch-over.”

     “I never tell anyone that someone works for me,” says Rice. “They work with me to build this company. We all built this company. Each person is valuable. If somebody doesn’t come in, it’s felt.”

     See the Matrix came through the Great Recession with relative ease. “We did notice that our customers weren’t buying new equipment as much, but none of them went out of business. In our house, we weren’t losing money, but we weren’t growing at great strides, so we tried to maintain our war chest in case it was needed. Raises were suspended for a couple of years but we were able to keep all of our staff.”

     During that time, the company even picked up some new customers who switched from having an on-site IT person, according to Rice.

     See the Matrix started out as a break/fix operation. “We’ve done our share of repairing slow computers, reviving monitors, fixing printers, ramping up memory and, of course, coming to the rescue when servers crash,” says Rice.

     The company has a ‘tell it like it is’ approach to repair. “We don’t just fix and leave. We tell them what they need to do so it won’t happen again. Sometimes equipment is just worn out and needs to be replaced. You wouldn’t want your medical doctor to just treat symptoms and not look for the root cause of the problem; you shouldn’t want that in your IT service either.”

     Furthering the medical analogy, Rice says that many people think they have to know what’s wrong before calling the IT professional. “You don’t,” he maintains.

     Today, fewer customers come on board in direct response to a computer crash. Rather, they have an increased level of awareness regarding operation and security, says Rice.

     A native of Charlotte, Rice graduated from West Charlotte High School before attending Appalachian State University. He graduated in 1998 with a degree in graphic arts, part of his somewhat unorthodox business plan.

     “I was way too interested in my fraternity and knew that I wouldn’t make it through business school, but I was already very handy with computers,” explains Rice who cleverly traded coursework for the maintenance of department computers.

     “I’ve always enjoyed technology,” says Rice who has had no formal IT training. “I was a geek as a kid—an audiophile—always breaking things that had to be fixed before Dad came home. It just made sense to me how these things worked.”

     Now, Rice, an avid reader, keeps abreast of new technology by diving into all the publications vendors and researchers offer. He also communicates with his young staff that includes a person dedicated to keeping up with what’s new. Plus, Rice says his customers are a great resource for new information. “It’s a matter of being receptive,” he says.


Staying on track

     Rice’s passion also extends to riding motorcycles, from motocross to joy-riding on the track.

     “I’m an avid biker,” exclaims Rice. “Four years ago, Santa brought my son a dirt bike for Christmas. I was so enthralled watching his fun—I couldn’t get enough.” Rice’s wife Patty surprised him with a bike for his birthday.

     “My first time out, I cracked two vertebrae and fractured my coccyx, a feat that will cause significant back pain for the rest of my life. But, I love it.”

     After the terrible accident, Rice engaged a motocross trainer who has taken him from a novice to a skilled rider in competition. Rice competed recently for a spot on the U.S. Team for the BMW Motorrad GS Trophy. Rice grabbed 17th place among 73 riders from around the country. The competition took place at the BMW Performance Center in Greer, South Carolina.

     Now the entire family—wife, son 9 and daughter 6 are all involved in riding. “We’re a very active, fit family. Exercise is a very big part of life,” says Rice.

     Rice is also active in furthering causes he feels deeply about. Sometimes, these interests overlap. Rice recently participated in a 10-day, 1,056-mile motorcycle ride across Peru as part of the filming of the television show Neale Bayly Rides: Peru on the SPEED Channel. The trip’s goal was to raise awareness in America of a non-profit organization, called Wellspring Outreach International, which helps to support orphaned children in the Peruvian village of Moquegua.

     “I lost a dear friend to brain cancer two years ago,” shares Rice. “I like to get involved with efforts to further research and treatment.” Rice also uses his gym workouts to raise funds for Barbells for Boobs. “I have to compete in ungodly awful exercise routines but it’s worth it,” he says with a smile.

     Rice hopes to grow the company into a $10 million enterprise during the next five years. “We’re going to continue growing our customer base and advancing our technology,” says Rice. He has been approached by potential buyers but says he has no plans to sell.

     “What would I do—perhaps ride motorcycles professionally for a while, but then what? I don’t want to start another business. I’ve already put the work in here.”

     “Some people are impressed with what we have and what we do, but I look around in amazement that I could afford a conference table, color laser printer or LCD monitor, much less have the opportunity to buy a building,” says Rice.

     He remembers the humble beginnings of the business when he would take a pay check home and say to his wife, “Put it in a drawer or use it as a note paid. We can’t cash it.”

     “I know how hard it is to grow a business. It’s been a great ride. We’ve come a long way but we haven’t peaked. We’re still clicking uphill.”

     For the last three years, health insurers and health care providers have been preparing for the start of open enrollment for the Federal Health Insurance Exchange or Marketplace created by the Affordable Care Act (ACA). And for the last several months, insurers from coast-to-coast have been announcing their rates for the health plans which will be offered through this new health insurance market beginning on October 1.

     As has been the case in most other states where ACA-conforming rates have been announced, the rates to be offered by Blue Cross and Blue Shield of North Carolina (BCBSNC) are lower than many had been expecting. That may be a bit of a surprise given that there will be only two competitors on the North Carolina exchange and only BCBSNC will offer plans in all 100 counties.

     “The opportunity to participate on the exchange was open to any company in the country, so we find it curious that many of them chose not to invest in our state,” says Brad Wilson, president and CEO of BCBSNC, “but our obligation is to North Carolina, so we didn’t calibrate our engagement based on how many competitors there would be on the exchange.”

     BCBSNC traces its roots back 80 years, when few people even had health insurance. Today, they cover one of every three people in North Carolina. They serve more than 3.75 million members and are the state’s largest health insurer. Their network includes more than 97 percent of medical doctors and 99 percent of hospitals in the state.

     BCBSNC executives believe that after the subsidies are taken into account, over two-thirds of the people who are candidates for an ACA-compliant policy will see either a decrease in their cost of insurance or a very minor increase. They also point out that ACA plans will generally offer richer benefits than most of today’s individual market plans. BCBSNC thinks that these cost dynamics will be the primary factor in determining eventual participation rates.

     Since many of the people who will buy through the ACA insurance marketplace have never bought health insurance before, education will be key to obtaining good participation rates. BCBSNC is helping educate the public through television commercials as well as their LetsTalkCost.com website, and meeting customers face-to-face through community events and meetings.

     “We’re doing some unique things we’ve never done before,” acknowledges BCBSNC Vice President of Sales—Group Markets Steve Crist. “For example, we’re inviting people who don’t historically seek out health insurance to movie premieres where we spend anywhere from 10 to 15 minutes talking generically about the importance of insurance and how easy it is to get. We’re also opening our own storefront retail venues.”


The Political and Economic Costs

     Ever since it was passed on March 23, 2010, the Affordable Care Act has been a political lightning rod. Due to their opposition to the Act, many states with Republican-controlled state governments—including North Carolina—have refused to set up their own state-based insurance exchanges, deferring to the federal government to establish and administer the exchange for their state.

     Many of these same states—again including North Carolina—have also chosen to opt out the ACA’s expansion of Medicaid to individuals and families with incomes up to 133 percent of the poverty level. However, these individuals will still be eligible for subsidies when purchasing coverage on the federally run exchange.

     Those two decisions by the North Carolina General Assembly have had differing impacts on the rollout of the ACA in the state. But, say Wilson and Crist, North Carolina’s decision not to operate a state-based exchange probably had little or no impact on the rates charged.

     “I don’t think the lack of a state-based exchange has added to the cost of the insurance,” explains Chist, “it just takes away some of the flexibility and decision-making authority from our state government and puts it in the hands of the feds.

     “Frankly, there were some theories that a federally facilitated exchange might be more inviting to national competitors like United Healthcare, Aetna and Cigna because they wouldn’t have to deal with the idiosyncrasies of a state-based exchange. But that did not prove to be the case.”

     “Our corporate position from day one has been that a state-based exchange was in the best interest of North Carolina,” adds Wilson. “We believe that the government that is closest to you is typically the best.”

     On the other hand, the BCBSNC executives argue North Carolina’s decision to opt out of Medicaid expansion has increased the rates that must be charged on the ACA exchange. They say the rates have to increase to cover the cost of providing care to people without the ability to pay.

     “We think between 500,000 and 800,000 North Carolinians would have been covered by the Medicaid expansion,” explains Wilson. “But those people are still accessing care when they need it, so the demands and cost on the system did not go away just because North Carolina chose not to accept additional money from the federal government to pay for that care.

     “Doctors and hospitals still are not being paid, which leaves a debt on their balance sheet that has to be made up by the private commercial side of the business.

     “As long as people are showing up and getting care that is not paid for, it is going to manifest itself somewhere,” he continues. “The question is: Are we going to do it rationally and appropriately, or are we just going to let this unsustainable economic model continue?”

     Another real risk with the insurance exchange is what insurers call “adverse selection,” where only those customers who are in immediate need of insurance actually sign up. Any insurance plan needs a diverse pool across which to spread the risk, so younger, healthier people need to sign up for the plans as well as the old and the sick.

     The ACA addresses that situation through what is called the individual mandate—a requirement that every individual not covered by an employer-sponsored plan, Medicaid, or Medicare secure an approved private insurance policy or pay a penalty.

     “We are fairly confident that those who need it the most are going to come onto the exchange—as they should,” says Wilson. “But I think one of the weaknesses of the ACA is the participation incentives for young, healthy people are not aggressive enough. There has to be enough incentive so that the cost of not participating outweighs the cost of the insurance.”

     BCBSNC also worries that the negative political energy directed toward the ACA will have a negative effect on the participation rate. In fact, some interests that oppose the ACA have launched a campaign to persuade the young and healthy to boycott the exchanges to, in effect, sabotage the ACA by actually encouraging the adverse selection insurers fear most.

     “There is so much political energy around it, our fear is this misinformation, coupled with the national ambivalence about the ACA, will keep people from signing up,” admits Crist.


Changing the Health Care Model

     In addition to expanding the availability of coverage, the ACA was designed to make health care more affordable by driving innovation and moving providers away from fee-for-service arrangements to more outcome-based reimbursement models that reward higher quality and greater efficiency.

     “There’s not a day that goes by that we don’t get a half dozen calls from providers saying they would like to do something collaboratively and differently,” offers Wilson. “Those trends have been initiated and accelerated by the passage of the legislation.”

     One significant accomplishment along those lines has been the partnership between BCBSNC and UNC Health Care Systems in forming Carolina Advanced Health. Established in 2011, it resulted from collaboration between Wilson, then new to his role as CEO of BCBSNC, and Dr. Bill Roper, CEO of UNC Health Care and dean of the UNC School of Medicine, as they discussed ways post-health reform could “move the needle” and truly make a difference in health care delivery.

     “We came up with the idea based on the patient-centered medical home model,” explains Wilson. “Now that Carolina Advanced Health is up and operational, it’s created a lot of buzz and we believe it will result in higher quality of care at a lower cost.”

     The medical home concept was first introduced by the American Academy of Pediatrics (AAP) in 1967 and defined as the center of a child’s medical records in special health care needs situations. Over time, however, it has evolved to signify a home base for any patient, child or adult, family, and primary provider in cooperation with specialists and support from the community.

     It has broad support in the medical community as an integral model for health care reform. In a rigorous discussion and analysis entitled The Strategy That Will Fix Health Care (Harvard Business Review, October 2013), authors Michael E. Porter and Thomas H. Lee describe the ultimate strategy for health care reform as maximizing value for patients by achieving the best outcomes at the lowest cost.

     They maintain that it will require restructuring how health care delivery is organized, measured, and reimbursed, and they applaud the medical home concept as an important step toward establishing better-coordinated, team-based care that has the ability to improve outcomes and lower costs.

     Carolina Advanced Health is certified as a Patient-Centered Medical Home (PCMH), the recognition for the most widely-adopted model for transforming primary care practices into medical homes. Established to help boost quality outcomes, streamline care and reduce medical costs, Roper describes the new practice as representing “the next generation of the PCMH.”

     “This is just the beginning of what we hope will be a new era in personalized health care that leads to improved patient health, greater efficiency, and lower health care costs,” he says.

     Specifically, doctors, nurses and other health professionals at the practice work together to manage every aspect of patient care to help improve the patient experience. The collaborative approach, aimed at improved health and quality standards and a reduction of complications among patients, will help reduce medical costs in the national transition from production-based to value-based medicine.

     Practices that are certified as a PCMH must meet a wide range of standards for technology use, patient access, care plans, care coordination, measurement, and performance improvement. Interestingly,  North Carolina is second only to California in PCMH designations, with over 30 percent of statewide primary care practices having received the PCMH certification.

     Among the requirements for PCMH certification are electronic medical records, a capability that has proven to be a problem for smaller primary care physician offices that lack the capital to install the necessary systems. However, BCBSNC partnered with health care technology provider Allscripts to offer their electronic solution at cost and provide training and maintenance for a year with BCBSNC paying for 85 percent of the cost for physicians’ offices and 100 percent of the cost for 39 of the state’s free medical clinics.


The Spirit of Collaboration

     “Establishing the new clinic didn’t have that many challenges or anything insurmountable,” explains Wilson. “The first step was deciding that these two organizations would come together on this project. If you think about it classically, a health insurer and a major academic medical center typically don’t come together to build things. Once we decided we had the spirit and the will to work together and bring this to pass, the hard work started.

     “Along the way, there were bumps in the road on very important issues like governance, how to pay providers working in the clinic, what kind of technology to employ, and how to handle specialty referrals. There were lots of important conversations. The key agreed-upon aspect of the project from the onset was that failure wasn’t an option.

     “When we got to a tough place, we stayed together, kept working, and found a solution. Then we moved down the road. All the teams that brought this clinic into being did exactly that. The work got done.”

     Carolina Advanced Health is currently available to about 5,000 eligible BCBSNC members, adults 18 to 62 with chronic illnesses. “The parameters were necessary,” says Wilson, “to make sure we had a well-defined population that we could accommodate and not lose our focus trying to determine best practices. As we learn what’s working well, we certainly intend to translate that into other age categories and populations.”

     Addressing the future of health care reform, both Wilson and Crist say the ACA is helping to drive more incentive-based wellness programs like the one available to BCBSNC employees. In that plan, each employee can earn up to $750 per year by achieving health goals set in a personalized health risk assessment. An employee’s goal might be weight loss, cholesterol management, blood pressure management, or a combination of goals.

     “The fascinating conversation is going to be a year from now when we have a full 12 months under our belt,” admits Wilson. “We’re getting ready to go to school here, and while most of our assumptions are fact-based, there has still been a lot of intuition involved.”

     He also suspects that other national competitors will take a look at the data after the first year and may opt to enter select markets where they believe the opportunity for reward is the greatest.

     “I’m optimistic about the future,” concludes Wilson. “I believe that we are at the beginning of a revolution, and in 10 years we will have a better system of care delivery and finance in this country.

     “I think it is going to look dramatically different than even what we’re talking about today, and I’m not sure exactly what it will look like, but we all have to get beyond the political acrimony that is consuming so much energy.

     “We need to focus on making sure that we as Americans become healthier and know how to use the system that will be created over the next 10 years—both for the financial well being of our nation as well as our overall health,” asserts Wilson.


     No matter the legal form of your business, the IRS may challenge your assertion that you are engaged in a business rather than a hobby. There is a significant difference in how the tax code treats hobby income and expenses versus business income and expenses. The IRS estimates that incorrect deductions of hobby expenses account for an estimated $30 billion per year in unpaid taxes due to overstated adjustments, deductions, exemptions and credits. If you tell the IRS you are engaged in a business you had better be able to “walk the walk” and prove it.

     Generally, an activity qualifies as a business if it has a profit motive. If not, the activity is subject to the hobby loss rules which state that deductible expenses are limited to the amount of income generated. Further, the expenses must exceed two percent of adjusted gross income before providing any tax benefit. Losses are unable to offset a taxpayer’s other income and a portion of a hobby income may be subject to tax.

     The IRS and the courts have provided the following factors to be considered in determining a profit motive.


Do you have a business plan? Business plans provide directions to the business owner, investors, bankers and the IRS. You should have a plan that projects an overall profit and reasonably predicts when you expect this profit to occur.


How do you run your business? Your activity should be conducted in a business-like manner. Your business should maintain a separate bank account, keep a separate set of books, and act like similar profitable businesses. You should have a yearly income statement and balance sheet, advertise your business, and have business cards and stationery. If you conduct your business like other successful people in the same industry you have a strong argument.


Do you have expertise in the field? A business operator should have extensive knowledge of his or her chosen profession or activity. This can be demonstrated by seeking advice from experts in your area and studying accepted business methods. Prior business experience with a similar product or service can also make a difference to the IRS.


Do you expend substantial time and effort? Devoting time to your business indicates intention to make a profit. Even if you have another job, using your free time to pursue this activity indicates an honest intention on making a profit. Document your time spent in order to better support your for-profit intent.


Have you changed your operating methods to improve profitability? If you have incurred losses in the past, documenting your efforts to improve profitability would lend credence to your assertion of a for-profit business motivation.


Will your business assets appreciate? If you expect assets used in your activity—such as land—to appreciate in value, IRS regulations say that appreciation may be used in lieu of current profits to indicate a profit motive for the business.


What is your past record in business? Even when your present business is unprofitable, if you have been able to convert other businesses in the past from unprofitable to profitable, this would be considered a factor in determining your profit motivation in your current business.


What is your history of income or losses? Losses in your business alone are not indicative that you are really engaged in a hobby. However, a long series of losses may draw the attention of the IRS, whereas sustained earnings indicate a business run for profit.


What are your relative profits and losses? According to the IRS, “The amount of profits in relation to the amount of losses incurred, and the relation to the amount of taxpayer’s investment and the value of the assets used in the activity, may provide useful criteria in determining the taxpayer’s intent.” However, the presumed profit motive in the IRS Regulations states that if an activity has a net income for three or more of the last five years then the activity is generally presumed to be for-profit.


What are your other sources of income? The IRS considers whether you have other sources of income. Having other income sources does not necessarily preclude your activity from being considered profit-motivated. The amount of time and effort you expend on your business may determine whether or not the business is considered to be operated for-profit.


Do you have recreation or “personal motives” for the activity? Activities that have recreational appeal and sustained continued losses may be more difficult to establish as for-profit activities rather than hobbies. For example, if you are serving as a guide for tour groups, it could be construed that you are using the activity to cover the cost of your travel expenses. On the contrary, if you are providing janitorial services such as scrubbing bathrooms and mopping floors, there is very little recreational appeal.


     Using the guidelines above can help strengthen your case with the IRS for running a profit-motivated business rather than being engaged in a hobby.

     Recently, I had lunch with several small business owners and executives, and the topic of discussion quickly focused on hiring new employees and partnering opportunities within the community. Some questions around the table included:


To what level do you conduct a background check on key people?

Are there better ways to verify a candidate’s credentials?

How did Joe do at Company XYZ?

Do you hire an outside recruiter to prescreen candidates?

Is anyone using a search engine or exploring social media to look at a candidate’s  history?

What do you know about Company ABC?


     As part of our own services, we develop technologies for collecting surveillance and intelligence information for the military, so I became intrigued with the mining of public information and databases to support decisions related to recruiting key personnel and entering into business partnerships. I wanted to assess recent improvements in commercial search engine technology, the ability to rapidly aggregate disparate data, and the amount of historic information that has been made available via the Internet, so I decided to investigate myself as a prospective employee and assess my “digital exhaust.”

     I did a quick search on Google and Bing and looked at the most recent news articles. I then checked the LinkedIn postings to see who was making professional recommendations and reviewed postings from business associates. Then, I decided to look into public records using Intelius and was impressed with the level of detail available about my multiple residences, tax payments in those localities, construction permits, and other information mined from public records over the past 25 years.

     Taking it to the next level, I ran some searches using proprietary tools and was quickly able to map my usage of multiple Internet devices and appliances such as mobile and VoIP phones, email servers, and cloud-based peripherals. Turning to social media sites, I looked for postings that referenced me or my business.

     During this walk down the digital yellow brick road, I discovered professional papers I had written more than 20 years ago that had been archived in a government information center, as well as statements that I had made to various publications over the years that are now accessible via the Internet. I even found some technical reports that I had written in the 1980s that have been digitized and made searchable by the Federation of American Scientists.

     In the 27 years of my professional life, I have created a modest digital exhaust. That digital exhaust has increased substantially with the digitization of photos, videos, transcripts, and professional publications, and the storage of that indexed information on the cloud.

     As an employer and business owner, evaluating the digital exhaust of a prospective employee or business partner is invaluable. Within an hour, I was able to construct a comprehensive profile of a person or entity to include: validating statements made on a resume or application, identifying the history of any legal and financial matters, assessing professional performance over time, and developing a general character profile.

     Analogous to the greenhouse effect, it became apparent that the digital exhaust of a person or company does not dissipate with time—it’s trapped forever in the peripherals connected to the Internet. I cannot help but wonder about the many college students who will post photos, comments and other digital media to a website, blog or social media site that will be accessible to the public for the remainder of their professional careers.

     As a business professional, it is imperative that we recognize our own generation of digital exhaust and the accessibility, and potential use, of that information by others.

     Do you really have a succession plan for your business? If you left work today and for one reason or another (retirement, disability or death) never returned to your company, what would happen? Does everyone know who would be in charge and who would make the decisions? Does everyone know who would manage and lead the company? Has a leader been selected and trained?

     Who would own the stock of the company upon your death? Would it be your wife, or your children, or a trust for the benefit of your children? Is this what you want? What does your will say?

     Do you have any shareholder’s agreements or other documents that place the ownership, management, and control of the company in the hands of the people who you would want to manage and control the company in your absence? Who would deal with the major customers you have always kept as “house accounts” and that you have the closest relationships with?

     How about your star salesman who accounts for one third of the revenues of your business? Would he now join the competitor who had earlier offered him an ownership opportunity? Would you keep all of your key employees? Who would deal with the bank?

     If you left work today and for whatever reason (retirement, disability or death) never returned to your company, would your company not only survive your departure but also thrive after you were gone? Is there “anything” that you need to do to be absolutely certain that it would thrive without you?

     If you are honest with yourself, you will probably acknowledge that there are some things that need to be addressed before that happened. But you say, “Well, I hear you, but that type of thing would hardly ever happen and if I did die or become disabled and never returned to my company, I have plenty of life insurance and disability insurance which would protect my family.”

     I hear you…but what if, instead of dying or becoming permanently disabled, you wait until you are ready to retire before addressing these issues? Will you be able to retire when you want to and, if so, will you have the necessary financial resources to live the way you want to live in your retirement? Or will you have to work until you die because you have not planned for your own succession so that your company can thrive without you?

     What we are talking about is succession planning. What is succession planning? It is part of your strategic business plan. It’s a plan for how the business survives separation from the owner or founder—whether because of retirement, disability or death. It involves planning for the continuation of your business after you leave.

     Three things have to be planned for: 1) the transition of ownership; 2) the transition of management and control of your business; and 3) the particular terms and conditions of your “exit” from the business.

     Succession planning is a process that all owners of privately owned businesses will ultimately have to deal with. There is no “if” in succession planning. There is only “when” and “how.” When and how will you deal with or have you dealt with your succession plan? Again, this process not only involves planning how your business will survive you, but it also involves how your business can thrive with or without you.

     Succession planning is one of the greatest unmet needs of business owners. According to a U.S. Trust survey, 50 percent of closely held business owners would like to transfer their businesses to “insiders” (family members or key employees), but only about 16 percent are able to do so. The others end up selling to “outsiders,” or liquidating their business for the value of its assets less its liabilities—usually a nominal amount.

     Why is that? Why can’t more business owners accomplish their objectives? In most cases, it is simply because of poor planning (or no planning) and the failure to identify and prepare true successors who are ready, willing and able to take over. In fact, statistics show only one third of the “most successful” businesses have succession plans which address all of the issues set forth above.

     In next month’s article, we will address some of the prerequisites for a successful succession plan and begin to discuss the particulars of a succession planning process for business owners.

     Good advertising is not the same as good marketing.

     Advertising is one piece of a marketing strategy. Effective marketing converts a customer into a loyalist. Establishing a connection and delivering an experience are the necessary elements for the customer-to-loyalist conversion to occur. This is internal marketing.


Internal Marketing: Creating an Experience

     Internal marketing is in the details. It’s the essence of a business. As the French would say, it is the ‘Je ne sais quoi.’ These details showcase the intangible of caring without having to say, “We care.”

     Creating an experience is as important as the end product or service and is what matters when recruiting loyalists to unknowingly join your company’s marketing team by telling the world through sites like Facebook, Twitter, Yelp, TripAdvisor and Google Reviews about their love (or disdain) of your enterprise.

     Examining customer touch points is where the development of internal marketing begins. The goal is to deliver a five-star experience for each customer interaction. Using a restaurant as an example, note the numerous points of contact before a meal is ever served.


  • Website: The digital first impression should be organized and professional.
  • Phone: Formal phone manners make an impression before an arrival.
  • Parking: Poorly marked parking areas or difficulty finding a space is arduous.
  • External Cleanliness: Landscaping, cleanliness of sidewalks make an impression.
  • Internal Cleanliness: Cleanliness of bathrooms, lobby and dining room say a lot.
  • Greeting by Host/Hostess: A warm greeting can set the right tone.
  • Time: Being seated, receiving the menu, ordering food and drink and receiving the food are details that greatly impact an experience.
  • Interactions: Attitude of the server plays the largest role during the experience.


     If asked to be a secret shopper, what merits a five-star review? If the food is impeccable, but all touch points mediocre, five stars is unlikely. What motivates an individual to make the effort to post via social media? The answer is simple, sell an experience versus a product or service. In the list above, the individual details don’t appear to hold great importance, but the combination of each affects the experience. The fine points do matter.

     Similar to a Broadway production, business operators must pay close attention to the minutiae. Before the curtain ascends, hours of preparation is focused on how the audience will judge the show. Beyond the playhouse being clean, the lighting must be correct, audio fine-tuned, actors well-rehearsed and support staff from the ushers to the concession attendants, well-trained. When the curtain rises, the show will not stop until the last note is sung and final bow is made. Thereafter, the process is repeated meticulously. The success of the show will be heavily influenced by the critics in the audience who publish reviews of praise or disappointment. So it is with organizations. When the doors open each day, we are judged not just by our product or service, but also on how we make customers feel.

     Each customer possessing a smartphone has the capability to reach hundreds or thousands of people within minutes. Leveraging customers to be advocates will yield a higher return on investment than any form of advertising.


5 Steps to Improve Internal Marketing


  1. Assess all customer points of contact utilizing the five senses: touch, taste, hearing, visual and smell. Evaluate each impression on five stars.
  2. Evaluate employees and their ability to deliver amazing service.
  3. Inquire how your customers feel about the experience using surveys, or just ask!
  4. Be adaptable to make necessary changes to achieve five-star outcomes.
  5. Consistently deliver a great experience each day.


     Generating traffic via advertising is one segment of a marketing blueprint. Retaining and converting customers into devotees is more comprehensive. An unyielding attention to the fine points activates word-of-mouth marketing and separates a business from its competition.

     Word-of-mouth is more influential than any form of advertising and cannot be purchased from an ad agency. It is created internally at a nominal price and can be achieved by any business owner interested in creating an experience while simultaneously selling a product or service.

     Famous last words… Since the enactment of the Immigration Reform and Control Act in 1986 (IRCA), federal and state governments have become increasingly determined to shift the burden of immigration law enforcement to U.S. employers. State legislatures, concerned that the federal government is not doing enough to enforce current law, are now enacting their own pieces of immigration law, making it a challenge for employers to do business in multiple states and apply corporate policies evenly. This shift has resulted in a minefield, one that even the most diligent and well-intentioned employer has difficulty navigating unscathed.

     Following the tragic events of 9/11, Congress passed The Homeland Security Act of 2002 to address perceived deficiencies in our immigration law, and creatie the Department of Homeland Security (DHS). Two of DHS’s agencies, U.S. Citizenship and Immigration Services (USCIS) and U.S. Immigration and Customs Enforcement (ICE), are now tasked with ensuring that U.S. employers are IRCA-compliant.

     USCIS is responsible for immigration benefits, for Form I-9 Employment Eligibility Verification (Form I-9) and for the federal e-Verify employment eligibility verification program. ICE is tasked with penalizing violators. Too often, the two agencies interpret provisions of the law differently, with employers forced to rely on a maze of unofficial policy guidance as to how best to comply.

     For example, an employee in H-1B status may begin working for a new employer upon the filing of a petition with USCIS; however, it is not clear how to reflect such authorization to work on the Form I-9 absent an approval from USCIS. In the case of an ICE investigation, questions may arise as to whether the individual is indeed authorized to work for the new employer.

     The stark reality for today’s employer is that it is not just a matter of ensuring that a Form I-9 is properly and timely completed for a new hire. Many states and federal contracts now also require that employers register with e-Verify, making mandatory what was once touted as a voluntary federal program.

     The interplay between Form I-9 completion and e-Verify confirmations can be confusing. For example, an employee with expiring work authorization must be re-verified for I-9 but not e-Verify purposes. Misuse of the two programs can trigger investigation by the U.S. Department of Justice Office of Special Counsel for Immigration-Related Unfair Employment Practices in the Civil Rights Decision (OSC) for unfair hiring practices.

     At a minimum, today’s prudent employer should have a written hiring and employment eligibility verification policy in place. This should include an internal compliance and training program related to the hiring and employment verification process, explaining: how to complete Form I-9 and whether to maintain copies of supporting documentation, how to identify fraudulent documents, and how to use e-Verify and the Social Security Number Verification Service (SSNVS) for wage reporting purposes (if part of the employer’s policy).

     Employers should require that Form I-9 completion and e-Verify confirmations be performed by specific employees who have received proper training. A further layer of review should be required to ensure any mistakes are quickly corrected. Employers should conduct annual audits, either using an external auditor or a neutral reviewer within the organization. Employers may also want to consider contractually binding subcontractors to these same standards.

     The written hiring and employment eligibility verification policy should include directives concerning how to handle letters from government agencies about conflicts in information between the agency, employer and/or employee. A prime example for this directive is to know how to handle the receipt of a “no match” letter from the Social Security Administration (SSA) which advises an employer that an employee may be using a social security number that does not coincide with SSA records.

     Employers should also consider including a provision for a “tip line” so that employees can report suspected incidents of unauthorized employment and a method for handling and investigating these tips. In addition, employers should ensure that authorized employees are not treated differently on the basis of citizenship or national origin in the hiring, firing or recruitment process.

     And this is just the tip of the iceberg. The USCIS also conducts site visits to investigate potential visa fraud by employers. The Department of State (DOS) has the authority to review visa applications for potential fraud and recommend revocation of approvals previously issued by USCIS.

     The Department of Labor (DOL) routinely audits applications by employers sponsoring foreign workers for permanent employment certification (the first step in the “green card” process). These audits and investigations are pitfalls for the unwary and can lead to enormous expenditures of time and resources if not handled properly.

Publisher's Posts

     I am always pleased to hear from our readers about our content, and especially responses to this column. In a recent communiqué, prompted by our current series on health care reform, a particular writer described how she had been confronted by unaffordably high costs of fairly straightforward services and how she overcame them. I think our readers may benefit from some of her insights, so here is her story in pertinent part.


     “I will begin by saying that I have had no health care coverage for a couple of years now. ‘That’s not how I was raised,’ my parents would say, but it has been an economic reality. Fortunately, I have been pretty healthy. Let’s put it this way—if all of my health care premiums were still in the bank, it’d be a pretty healthy bank account, too. But that’s not how it works.

      “Let me say initially that this ‘self-help’ I describe involves healthy amounts of Internet research.

      “From my general reading, I had decided it would be prudent to embark on hormone replacement therapy (HRT), appropriate for my age to prevent osteoporosis and benefit cardiovascular health. So, for the first time in over 15 years, I decided to go to a doctor.

      “I was very careful to ask in advance about the costs of the consultation and ancillary procedures, as I had to budget for them.

      “I went to my appointment, again confirming the costs with the receptionist before I completed the paperwork. Before they could put me in the system, however, it took them some time to figure out the right ‘code’ for someone who was uninsured.

      “After the visit, I stopped at the payment counter. There they tried to assign dollar amounts for the services rendered. Again, it took them quite some time to locate a fairly beaten up binder of plastic-covered sheets with the rates for services, and an equal amount to match up codes with services that should be charged. Actually, I was at the payment counter longer than the entire appointment had taken. After we got it all straightened out, I wrote my check.

      “The regular exam and five blood tests totaled $1,200-plus. Those blood tests alone had been charged at whopping $800. And that’s with the ‘self pay discount.’

      “No more than a week later, I received a bill from the doctor’s billing service attempting to charge me $70 more. I returned it with an explanation that nothing more would be forthcoming, along with copies of the bill marked Paid in Full and my cancelled check. Then about a month later, I received the same invoice as before, only now ‘60 days late.’

      “This wasn’t long after The Charlotte Observer’s series of articles on hospitals’ aggressive collection tactics, so I wasn’t surprised. I sent back the same information and was prepared to do so each time in the future, but I did not receive any further invoices.

      “As far as the prices for the actual HRT prescription, the lowest price I could find among all area pharmacies including Costco was $115 per month. So after paying that once, I researched whether I could find it cheaper online. As it turns out, there are a number of reputable pharmacies in Canada that anyone can order from for about one-third of the price of the same exact (non-generic) product in the U.S.

      “So I chose one—www.onlinepharmaciescanada.com—and emailed them my prescription, and from that time on I have had exemplary service, receiving shipments every three months.

      “As the year passed, I knew that, while I might have to see the doctor annually, there was no reason at my age and given current recommendations of the surgeon general, that I needed an exam every year. So this year when it was time to go, I determined to specify that no exam was necessary, only a consult on blood work with the doctor.

       “Then I did some research online on how to get blood tests done less expensively. First, though, I had to request my records from the doctor to see the particulars of the blood tests that had been done the first time. When I picked up a copy of those records, I was glad I did, because they had a lot of information that should be part of my own personal health record.

      “Poring over the medical jargon, I was able to discern the five tests I would need. And, as it turned out, there are many sites on the Internet where you can register and schedule to have blood work done at local facilities through Quest and LabCorp without a prescription and receive the results directly yourself.

      [Sites include: health-tests-direct.com, healthtestbenefits.com, medlabusa.com, mymedlab.com, healthcheckusa.com, directlab.com, and firstchoicelabsusa.com (requires Rx).]

      “So I registered online for the five tests I needed and chose the office location most convenient—which was, by the way, just a floor below the doctor’s office! I paid the total for the tests of $183 and the time and date of my appointment was confirmed.

      “The LabCorp office was very efficient and had all paperwork in order. It was evident on the receipt that if I had not paid for the blood work through the online site, it would have been $700 for the five tests. (They say the doctor’s office usually adds on medical waste disposal fees, etc. to this amount.)

      I provided the results to my doctor’s office and the subsequent consult was direct and informative and a mere $125.

      “What I have learned is to be more aggressive about my own health care than ever before. While I did not have a choice—it was either find a more affordable solution or do without—I encourage others to research and aggressively inquire about expenses of non-emergency health care. This year, being proactive, what cost in excess of $1,200 last year was kept to a minimal $300 level, and managing the monthly prescription costs is a third as expensive.”


     In my opinion, one of the best attributes of the new health care system set up by the Affordable Care Act is the emphasis on consumer choice and decision-making. American consumers are wise participants in our free enterprise system and know how to weigh the costs and the quality in their decision-making parameters.


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