Gregory G Degnan, MD

Medical Director at acac

Christine Thalwitz

Vice President of Marketing at acac

Medical Fitness

• ACA wellness mandates

• AMA’s stance on obesity

• Exercise is Medicine initiative

… the perfect storm

Who we are

low-cost, introductory exercise program

340 average monthly program sales

> 22,000 patients to date

40% convert to annual paying memberships

Average membership > 30 months

$27 million gross/$16 million net

Medical Fitness

Phil Wendel, owner

“Interested inactives”

Of special interest:

• Older adults

• Individuals new to exercise

Target markets

Amenities & programs

acac Albemarle Square

Charlottesville, VA

acac Downtown

Charlottesville, VA

acac Adventure Central

Charlottesville, VA

Crozet, VA

West Chester, PA

Midlothian, VA

Short Pump, VA

Maryland Athletic Clubs

Critical program components

Internal structures and culture

Outreach strategies

Scope & scale

The opportunity ladder

The doc is in …

so we’ll leave plenty of time for Q & A!

Today’s Objectives

Historically, 2 separate entities

Little overlap

Less communication

A few physician champions

A few fitness visionaries

A tale of 2 industries

Surgeon General’s “Exercise is Medicine”

AMA’s declaration of obesity as a disease

Affordable Care Act

Dollars are driving a move toward

prevention

Medical integration

Provider level – private/academic practice

Wellness level – small business owner

Hospital/insurance level – hospital board of managers and vice chair of regional integrated network

Lifelong exerciser –

40 year member

Volunteer medical

advisor

Employed as

medical director

My perspective

One foot in

both worlds

Helps to bridge

the cultural

and “business

model” gap

My perspective

“Prevention” – past

and present

The health of our

nation

Despite technology

and improved

treatment

Obesity and

sedentary lifestyle

Increase in aging

population

State of health care

Driven by:

Rising costs

Affordable Health Care Act

Realization of declining health

Drivers of change

Challenges/weaknesses

Nutrition

Market penetration

20% barrier

60% interested

deconditioned

Training “Attitude”

Training the “fit” and

“trainable”

Drivers of change

Complete Package

Step up our resume

Exercise alone is not enough

Training “attitude”

Embrace our new population

Play to the strength of your trainers

Marketing shift

This population is not direct to consumer

Drivers of change

Not a new concept

On the radar in both

industries

6 presentations on

medical programming

Attorneys, MBAs,

Marketing experts, Fitness

experts, and physicians

Moving forward

Opportunity is apparent …

concrete methods are elusive

Clarity out of chaos

Methods to become involved regardless of club size

Concrete plans for multiple levels of club involvement

Road map for increased membership

Improve community health

Our goal today

Multiple levels of involvement

Provider level

Corporate level

Insurance/ACO/Integrated network level

To consider

Driven by scale of

your organization

Driven by your

health care market

Driven by your

desired level of

investment and

commitment

To consider

Cultural changes

Facilities changes

Marketing and outreach changes

What makes you attractive to the

medical community

The vision

11 years in the making

Started with philosophical commitment

Built a solid basic program – p.r.e.p.

Slowly built a medical model

Physical therapy, nutritionist, nurse, MFA

Vision to reality

Be realistic about necessary changes

Will not succeed with half measures

Seems simple

Many pitfalls

Often seemingly insignificant details

Vision to reality

Organizational

Owners/administrators

You set the tone

You are the key to

success

Changes

Sales

Different population

Different strategies

Not volunteers

Wary of “time share”

Provider concerns

No “hard sell”

Changes

Trainers

Deconditioned participants,

marginally motivated

Special needs/restrictions

Exercise 101

Hand holding 404

Embrace it and change lives

Ignore it and fail

Changes

Comfort Zone

Basic machines

Cardio

Flexibility

Social section (if

(if possible)

Changes

Layout/Exposure

Unfamiliar

Intimidating

Create a “comfort zone”

Use space or scheduling

Varies club to club

Social aspect is important

Changes

Comfort Zone

Handicapped friendly

Maneuvering space

Pool – not necessary but big asset

CPR/AED training

Emergency action plans

Changes

Facilities

Nutrition

Nutritionist vs Trainers

Marketing/Outreach

Key component

Common cause of

failure

Financial commitment

Depends on level of

involvement

Changes

Organizational commitment

Organizational expertise

Basic program – the “Foundation”

A “Team”

“Comfort Zone”

Outreach

The basics

MEMBERSHIPS

Doesn’t cut into your normal population

Don’t need to recruit them away from your comptetitors

Bonus members

The bonus pool is potentially huge

The upside

Foundation and workhorse

Provider referred introduction

to lifestyle

Appropriate for any size club

Data

Least important on the

marketing end

Data for provider feedback is

important

Program levels

Basic program

Team

Facilities

Marketing – a key factor

for success

Be patient

Use physician champions

Program levels

Affordable Care Act

30% premium discounts

Loose definitions of

“wellness program”

Participation vs.

outcomes

Data capture is crucial

at this level

Program levels

Involvement defined by your “bricks and mortar”

On-site, off-site & virtual services

HRA | Biometric screening | Exercise – basics

Nutrition & Education - strong sellers

Remember HIPAA

“Roll over” into corporate memberships

Subsidies based on use or outcomes

Program levels

Ongoing participation – HR’s biggest concern

>40% rollover

On site lectures/video education

Marketing is Key

Capitalize on HR burden/need for assistance

Use basic program as a foundation

Gear towards open enrollment

Program levels

ACOs/Integrated networks/Insurance carriers

New relationship with ill-defined model

Requires significant resources and scale

Largest front end investment

MUST HAVE DATA

Program levels

Requires ongoing programming

Requires metrics based outcomes

Consider small programs for specific

groups ( i.e. Diabetes)

Requires IT support

Requires specialized marketing

Physician champions are key

Program levels

Investment/Risk vs Benefits

Not well defined at present

Front end dollars and rollover

Toughest market with highest

front end

Rules and pathway not yet

well defined

Program levels

Something for everyone

Scope is defined by your

scale/interest/investment

Foundation program is key

Inexpensive, non-intimidating, basic

exercise and nutrition

Everything is built off of this

Seems simple…. It is not

Program levels

Gregory G Degnan, MD

Medical Director at acac

Christine Thalwitz

Vice President of Marketing at acac

acac.com

Thank you