Taking Reasonable Risks to Promote Long-Term Growth.

In 2003, Dr. R. Alan Grimes and Dr. Alejandra Beardman perceived market opportunities and industry trends that favored creating an independent practice. They founded Priority Care Pediatrics, now the largest single-specialty group in the Kansas City, Missouri area with three locations and a clinical staff of 17 physicians, two nurse practitioners and four mental health professionals.

Beyond pediatric care, the practice’s comprehensive offerings encompass lactation services, nutrition counseling, immunizations, behavioral/mental health services, care coordination, sports medicine, obesity management and more. Priority Care Pediatrics was Missouri’s first Affordable Care Act Pediatric Health Home and is also an NCQA-recognized patient-centered medical home.

 

Aligning Patient Care and Business Strategies

Four core principles anchor the practice’s strategy:

• Take risks. Be willing to invest ahead of immediate needs. For example, the practice’s third office expansion represented a marketing opportunity rather than a necessity.
• Adopt a growth mindset. Priority Care Pediatrics believes that today’s competitive healthcare market demands scale and growth. Dr. Grimes says the practice wants to be “big enough to be relevant,” both to insurance companies and corporate organizations.
• Adhere rigorously to a patient/family-centric approach. Growth must serve a deep commitment to building patient relationships. Dr. Beardman notes that the practice looks at patients as families, a philosophy captured in the practice’s tagline: “Partnering with Families. Caring for Kids.”
• Promote work-life balance. Controlling the practice’s own destiny permits decisions that balance physician wellbeing with the bottom line.

Numerous Challenges and Needs

Executing this strategy has taken considerable navigation of challenges over many years. Priority Care Pediatrics has worked closely with Commerce every step of the way.

Drs. Grimes and Beardman faced substantial hurdles in launching the practice. The two had no capital, no operating experience and little in the way of significant banking relationships. Additional challenges arose a few years after inception when the practice found it needed more space. The practice decided that building its own facility was the best way to proceed. The process was complex and intimidating. Several years later, Priority Care Pediatrics again encountered a need to assess risks and obtain financing to open a second, and then third location.

Then came the COVID-19 pandemic. Revenue plummeted over 60% in the early months and declined an estimated 20% for 2020. The practice was forced to cut staff hours and pay, though thankfully not as much as others locally or nationally, due to a strong banking relationship and quick action with Commerce Bank. Cash was needed for supplies and other critical expenses. Witnessing area pediatric practices closing, Priority Care Pediatrics was concerned the crisis would threaten its independence or viability. The federal Paycheck Protection Program (PPP) was a lifeline, but like most businesses, the practice was unsure how to navigate the process.

 

The Right Partner: CommerceHealthcare^®

Commerce has implemented multiple programs to meet these challenges, demonstrating the bank’s versatility in partnering with healthcare providers.

• Startup funding. Dr. Grimes first sought funding from his personal bank at the time, which was not receptive. The founders then approached a large national bank but were not taken seriously. “We were literally laughed at,” remembers Dr. Grimes. Upon meeting with Commerce, Drs. Grimes and Beardman found a financial institution willing to listen and work with them. Priority Care Pediatrics secured a loan to launch the practice.
• Subsequent credit. Prudent, timely risk-taking has characterized the relationship ever since. Commerce has provided credit lines and leasehold improvement loans to support the practice’s physical expansion and growing working capital and investment needs. Priority Care Pediatrics currently draws on a multi-million dollar line of credit.
• Pandemic response. At the outset of the PPP loan program, confusion and delays were widespread. Commerce walked the practice through the application process, securing the funding rapidly. Dr. Beardman says the practice had the check in the bank before several other pediatric organizations had even found a bank to begin the application process. Priority Care Pediatrics has already received full forgiveness, noting that Commerce’s portal has been top notch.

The practice leans on Commerce for strategic and operational advice as well. The bank’s tiering-in model ensures that higher levels of bank management are engaged as escalation warrants. It creates a true supportive relationship.

Commerce brings three fundamental characteristics to these relationships:

• Extensive healthcare experience.
• Community involvement. During the construction of the practice’s new headquarters, Commerce used its local knowledge to offer guidance on contractors and quickly address construction delays.
• Disciplined methodology. Commerce has a long history of helping medical practices grow from start-up into large influencers in their markets. This knowledge and experience provided added value for Priority Care Pediatrics.

Benefits Achieved

Priority Care Pediatrics has derived multiple benefits from the Commerce relationship:

• Strategic continuity. The stable funding base has enabled Priority Care Pediatrics to remain focused on its twin commitments to optimal patient experience and prudent growth.
• Access to an array of services. Full-service banking maximizes convenience for a busy group of physicians.
• A trusted relationship. Mirroring the practice’s approach to its patients, Commerce has gone beyond funding to create a long-term bond with ongoing counsel that augments the practice’s agility.
• Successful navigation of COVID-19. Priority Care Pediatrics has avoided layoffs, or worse, closing the practice. They have even restored full staff hours and pay to pre-COVID levels.

Looking Ahead

Continued financing is anticipated as the practice works toward full recovery from the pandemic. Priority Care Pediatrics is also contemplating adding additional doctors and staff. Longer-term, the practice envisions more opportunities to capitalize on industry changes and maintain its successful strategy.