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Tackling the Challenge of Physician-Hospital Relations (Part I)

William K. Cors, MD, for HealthLeaders Media, January 31, 2008
Editor's note: This is the first section of a two-part series. For part two, visit www.healthleadersmedia.com/PartII.

It seems that conflict is the fastest-growing product line in contemporary healthcare. Medical staff leaders must become comfortable with navigating these potentially treacherous waters. Here, we offer practical approaches and strategies designed to help medical staff leaders understand and begin to grapple with the real day-to-day issues encountered.

Beginning with the end in mind, here are some snapshots of what successful outcomes might look like:

  • A formalized medical leadership academy with defined curriculum supported by physicians and the hospital for the teaching, training and development of physician leaders
  • An explicit compact between the physician and hospitals defining mutual expectations and behaviors
  • Groups able to work and play together with trust growing from structured access
  • A shared vision of mutual success and the communication skills necessary to engage in vital conversations about present and future states.
Compare this to the current reality in many organizations. What often exists is unmanaged conflict, poor communication skills, lack of trust and an absence of respect. It is a very real observation that conflict in healthcare is a growth industry.

The Greeley Company has developed a ten step approach to improving physician and hospital relations. A central theme underlying this proactive approach is communication on multiple levels, in varied forums and as part of an ongoing commitment to leave things better than we find them.

Step 1: Acknowledge physicians are customers, partners, suppliers and competitors.
The first step is to acknowledge that physicians are simultaneously customers, partners, suppliers and competitors of hospitals. This is clearly a "get over it" moment for most of management. In order to make progress in this new environment, the change must first be acknowledged, discussed and understood. Only then can progression occur.

The ability to manage conflict is a necessary skill to approach this new paradigm. Physician and hospital leaders need to learn to distinguish which problems can be solved and those which are unsolvable and require training in Polarity ManagementT to handle. The ability to manage the following polarities is critical to success:

  • Physicians are both customers and suppliers
  • Physicians are both partners to be worked with in a collaborative fashion but are simultaneously competitors for shrinking healthcare dollars
  • Physicians are both independent practitioners yet mutually accountable to each other for the quality of care rendered by individuals granted privileges at the hospital
Step 2: Heal the past.
To move forward and succeed, the past must be healed. To achieve this, several things must occur:
  • Identify the perceived injuries from the past
  • Agree to "no playing old tapes"
  • Work through the polarity of impact and intent.
As will be seen in the next steps, tools for success include multi-channel communication, development of physician leadership competencies, negotiation skills, strategic thinking and specialized tools such as Polarity ManagementT.

Step 3: Create a shared vision of mutual success.
Physicians and hospitals must create a shared vision for mutual success. Efforts to align physicians and hospitals toward a common purpose often prove difficult. These groups have different beliefs about what is important, posses conflicting perspectives on who they are and often perceive each other as distinct or threatening.

The first necessity is the development of a strategic plan for the medical staff. Virtually every hospital with whom we have worked has a strategic plan; conversely, very few physician medical staffs do. Strategic planning is a disciplined effort to produce fundamental decisions and actions that shape and guide what an organization or group is, what it does and why. The Medical Executive Committee should charter the development of:

  • A mission statement which is a precise statement of purpose. The Greeley Company teaches that the fundamental purpose of the medical staff is to monitor and improve the quality of care that is primarily dependent upon the performance of individuals granted privileges.
  • A vision statement which answers what would it look like if the medical staff hit a home run fulfilling this mission. The Greeley answer to that is a truly effective medical staff form and function; indeed, much of our work with physicians and hospitals is how to achieve that effectiveness.
The second necessity is to acknowledge that the old medical staff development plan based on needs, demographics and physician age is outdated and inadequate to deal with today's increasingly complex environment. There needs to be multiple joint physician-hospital strategies:
  • An organized medical staff strategy that includes a physician-hospital compact, formal leadership development, building social capital and increasing communication.
  • Alignment strategies by specialty which can include employment, exclusive contracts, medical directorship, joint ventures, recruitment support and on-call compensation. In short, not one size fits all. Flexibility is paramount and not all physicians get treated the same
  • Recruitment and retention strategies based on physician satisfaction surveys, recruitment support, physician liaison, practice support, branding, operations councils, contracting strategies and no volume/low volume alignment. Competition and collaboration strategies which might include conflict of interest policies, joint ventures, facility leasing, economic credentialing issues and managed care contracting.
Step 4: Develop mutual expectations for physicians and the hospital: The physician-hospital compact.
A compact, very simply, is an agreement or covenant between two or more parties. The covenant is a written agreement between the parties for the performance of some action. The development of a compact, a written covenant, between the medical staff and the hospital can be a powerful tool to discuss, develop and codify mutual expectations of each other.

A powerful starting point is to look at the respective mission statements of the medical staff and the hospital. The medical staff mission statement would include insuring the quality of care of individuals granted privileges and being mutually accountable to each other for that care. The hospital mission statement probably includes language outlining how it provides patient-centered quality care to the community or region it serves. A joint starting point then might be:

    "There is a mutual interest in providing better and expanding clinical care and programs to our patients and our communities."
Using this as a starting point, the physicians and hospitals can codify what expectations might be addressed in the compact, including:
  • Expectations of each other, including what physicians would expect from the hospital to provide quality staffing and timely, excellent support services. Also, what the hospital would expect from physicians to be effective in holding each other accountable for care delivered by individuals granted privileges
  • Expectations of mutually beneficial clinical and business ventures that would be explored on a right of first refusal basis
  • Expectations that fair and just processes would be developed to handle conflict, disagreement and violations of the compact
The use of a compact is an effective tool for the alignment and advancement of diverse groups in their mutual interest to provide better and expanding clinical care to patients and communities.

Editor's note: In an upcoming issue of HealthLeaders Media PhysicianLeaders, we will continue with Part 2 of the 10 Steps to successful physician-hospital relations.


William K. Cors, MD, MMM, FACPE, is Vice President of Medical Staff Services for The Greeley Company, A Division of HCPro, Inc., in Marblehead, Massachusetts.
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