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Great Group Practices

Patrick T. Buckley, MPA, for HealthLeaders Media, February 21, 2008
In his 2001 book, Good To Great, author Jim Collins talked about research he and his associates had conducted on why some companies thrived during economic downturns and others in the same field floundered. Although the companies that Collins and his team studied didn't include medical group practices, there are a number of principles that are relevant to physicians trying to run a successful business.

So what makes a group practice great?

In many cases, marketing makes the difference between a mediocre group practice and an exceptional one. CEOs will tell you that the "moments of truth" for a business occur in daily operations. All the publicity, promotion, and advertising in the world won't matter one bit if the word on the street is that it is difficult to make an appointment or get in to see your physician. But those who would separate marketing from operations fail to see that the two are integrally wound together. Timely appointment-setting, friendly reception, respect for the patient's opinion, and protecting patients' rights are all things that happen through customer interaction--which is operations and marketing.

In a recent focus group I arranged, the facilitator asked participants what they felt truly equated to a great experience when seeing a physician. "I was concerned that there may have been wrong information in my medical record and asked if I could review it," one participant explained. "Not only did they let me review it, but they apologized after I pointed out mistakes in the record and promised to correct them. They also asked that I double-check with them later to make sure the corrections were made."

Another participant boasted that the nurse arranged for a pick up when she wasn't able to drive. Others lauded simple things like being able to make appointments online or in the evening, and for being informed of the doctor's progress every ten minutes when waiting for an appointment.

These are the things that Jim Collins would say are the mark of a great, not just a good, medical group practice. They are the result of truly listening to the patient, putting the customer (patient) first, and doing something as opposed to just talking about it. At first, employees and their managers are worried that implementing patient-driven enhancements will take too much time and cost too much. However, practices that operate with a focus on the patient have actually seen employee morale improve--without seeing costs skyrocket. In fact, in some cases, they have gone down because of spin-off efficiencies as a result of process improvements.

A number of progressive medical groups have learned the secret to building and sustaining patient volume. They have integrated market research into their efforts to improve operations, and they have fine-tuned their operations to incorporate marketing concepts. But even the best-run practices struggle with the ongoing throughput/efficiency vs. customer satisfaction challenge. There is an opportunity cost to an unused MRI machine or an empty exam room. Machines and buildings have sunk costs that must be covered by paying customers. To the degree that a practice can accommodate throughput without sacrificing clinical quality, it will achieve coverage of the fixed and variable costs that exist with all operations. But will it achieve customer satisfaction?

A recent study that was reported in the Denver Business Journal suggests that efforts at increasing efficiency can be compatible with customer service. The article claims that overbooking patients (similar to how airlines overbook flights) may be better for large practices where there can be a significant number of patient no-shows. Which leads one to ask: Wouldn't it make sense to find out why there are so many no-shows and devise a strategy that would cut down on them? This is where market research and strategy can be instrumental in not only improving operational efficiency but in increasing patient loyalty and satisfaction.

Together, operations and marketing help bring in patients and keep them coming back to a physician's practice (if medically necessary). There are many factors involved in attaining patient loyalty, including competent clinical management of chronic disease from specialists and pharmacologic management of cholesterol levels and blood pressure by primary care physicians. However, what makes a patient refer other potential patients to the practice (the "multiplier effect" of marketing), is primarily the skills and understanding of the physician in meeting the patient's specific health care needs. And what makes you're a great group practice is making your interaction with patients more than just a "get 'em in, get 'em out" experience.


Patrick T. Buckley, MPA, president and CEO of PB Healthcare Business Solutions, LLC, a consulting firm that assists healthcare organizations with strategy, marketing, and management. He is also the author of the new HealthLeaders Media book, Physician Entrepreneurs: Marketing Toolkit, which includes marketing techniques, sample forms, and templates geared specifically for physician practices.

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