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Model for Success

Elyas Bakhtiari, for HealthLeaders Media, October 13, 2008
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From operational improvements like Six Sigma and Lean to EMR implementation and pay for performance, many of the newer management and care techniques that the entire industry is moving toward require a new level of integration, both within groups and between settings. However, any time there's an effort to better define the culture of the group, there's a risk that some physicians won't be able or willing to adapt, James says.

Physicians' new roles
For Scott D. Hayworth, MD, convincing new physicians that organizational change and growth are necessary has been one of the biggest challenges as president and CEO of Mount Kisco Medical Group, a multispecialty practice with more than 170 physicians in Mount Kisco, NY.

Mount Kisco is in a market with rapid consolidation, and its long-term strategy involves aggressive growth in both size and scope. It has recruited physicians to continue its expansion of services into vascular surgery, pediatric neurology, dermatology, and other subspecialty areas, and it has put money into an ambulatory surgery center—which Mount Kisco has owned for five years—and imaging services.

Getting physicians to buy into that growth philosophy is absolutely crucial, Hayworth says. Physicians who were around a dozen years ago when the group had only 38 physicians were accustomed to having more direct control over strategic decisions. As healthcare management becomes more complex and organizations grow, there's a need for more sophisticated practice management and a certain degree of segregation between administrative and clinical duties. Decisions are now approved by an 18-physician board of directors, and a suite of executives handles overall leadership.

"It's a challenge getting doctors to give up hands-on, day-to-day management," Hayworth says. "They've got to let financial and operations people run the practices so they can step back and be the great doctors they are and practice medicine."

Relinquishing control is not easy, especially for many older physicians who can be fiercely independent and may have started practicing on their own. That's why it's important to be very selective in bringing in new doctors, making sure their practice still meshes with the organization's culture, he explains. "If you start taking physicians that don't fit your culture and don't match your quality levels, then you run the risk of hurting your brand. We're very careful about who we bring into the group," Hayworth says.

The good news is that today's physicians are increasingly well-suited for the new structures medical groups are implementing. Younger doctors are less interested in starting and running a practice on their own and more open to working as an employee or an integrated member in a larger organization.

At the same time some physicians are relinquishing some of their entrepreneurial instincts, there's a growing need for physician leadership. With segregated administrative and clinical departments, physicians who can straddle both worlds and translate clinical issues for administrators and administrative issues for clinicians are extremely valuable. That's part of the reason the number of physicians returning to classrooms to get MBAs has spiked in the past couple of years, according to the American Medical Association. It's becoming more common to see members of the C-suite with an MD after their names, but today's healthcare organizations require a sophisticated understanding of leadership and business that not every physician can provide.

Best of both worlds The trend toward bigger physician groups that embrace business principles comes with one caveat: Patients don't always like it. Practices can't survive without a more sophisticated approach to finances and operations, but patients tend to miss the personal connection that the mom-and-pop community practices are able to provide. As financial pressures force physicians to increase patient volume, the consequence can be a deteriorating doctor-patient relationship. In short, as practices have become bigger and more complex, they have become, at times, impersonal.

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