Physicians Need Business Training to Run their Practices Well

By Rebecca Fox, MD of Physicians Practice

Once physicians graduate medical school and complete the internship year, they can get unrestricted licensure in most states to practice medicine and surgery. However, I doubt that very few people would choose a doctor that had only these credentials and did not have extensive residency training and board certification in their specialty. As physicians, we spend an incredible amount of time and mental energy mastering the extensive body of knowledge that we need to practice medicine competently.

However, when we get out of our medical training, we are suddenly faced with the truth of the matter: We have no clue how to run a business! We are a really smart group of people that have not received the proper instruction for the business world.

If there is one thing I know about doctors, when we do not know something, we tend to disengage. We want to know what to do in order to help people. If we don’t know what to do, we retreat. We do it with patients and we do it with the business side of our practices, usually with poor results.

It is really hard as a physician to deal with a patient’s complaints if you don’t know what to do. It is easier to dismiss the topic and move on to something you feel competent with in order to help the patient. To give you an example, when I was faced with a very obese (72 pounds) two-year-old boy, my first reaction was to refer to pediatric endocrinology because I did not know how else to address the situation. However this little boy had no endocrine effects from his extreme obesity (yet!) so no endocrinologist would see him. Therefore, I was on my own to figure out what to do. Rather than to not address the problem, I sought to educate myself on pediatric obesity. I went to a continuing education course specifically to learn what to do for obese and overweight patients. I read further references and journals. I learned the proper approach and evaluation of these patients and now feel competent dealing with this subject; therefore I can help my patients.

But what about my practice? As I have written before, a medical practice needs the same level of care and attention as a patient in order to stay healthy and thrive. As long as everything is running well and the bills and payroll are met, it is easy to ignore or avoid the details. But when trouble arises, the physician owner(s) must be able to diagnose and treat their business. If they do not know how, then further education is necessary.

About four years ago, my practice went through a financial crisis after a year in which we had a "perfect storm" of events that drove us into red ink. My senior partner had a death in the family and the two junior partners had just attained this ownership level (and thus were inexperienced in all that is required of an owner). My office manager had been on the job for about two months at the point.  I had to deal with this looming disaster alone. I very quickly learned about financial analysis. The situation was so dire we considered having to lay off a provider. My office manager took an aggressive approach to cutting costs and it was my responsibility to increase revenue generated by the providers. Within 10 months, the practice had a complete financial turnaround and was back in the black. We have been solvent since that time.

So, how can physicians get the education they need to at least speak the language of office managers? They don’t have to go back to graduate school for an MBA. They can start slowly by reading journal articles about the business and management of medical offices as well as the multitude of business books on the market today. Many medical professional associates have resources as well.

One excellent source of education and information is Medical Group Management Association (MGMA). I have been attending the MGMA conference for the past three years. I have gained an incredible amount of education and knowledge that has improved my ability to guide the office manager and has given me skills to deal with financial matters and human resource challenges. I received education about management and feel that I am a better physician owner of my large pediatric practice. Additionally, the MGMA is very well versed in ongoing changes with government mandates and insurance company requirements.

Don’t get me wrong. I definitely want to leave management to the professionals and do what I am good at which is seeing patients (and generating revenue). But in order to create the kind of practice that my partners and I want, we have had to get more involved in the management issues; not to replace our office manager but to support her to do her job successfully. The combination of an effective office administrator along with the full support and understanding of the physician owners allows a seamless approach to our practice of 14 providers and over 40 employees.

By Rebecca Fox, MD of Physicians Practice
Courtesy of: http://www.physicianspractice.com/blog/physicians-need-business-training-run-their-practices-well?GUID=2E8F906E-CDE7-43B7-AC93-7066F83372C7&rememberme=1&ts=15102013