Even such seemingly small details as a departmental annual budget are built to foster physician teamwork, says W. Roy Smythe, MD, medical director for innovation at Scott & White Healthcare.
"The departments have no endowments," Smythe says. "At the end of the year, if my department was several million dollars in the black, it all went back to the house. All of it." The benefit of that zeroing out is that if the department of surgery or pediatrics or medicine wanted a new device or position or program, it would have to gain leverage for its idea across several departments.
"There were very few times I went to the administration and asked for big things without having gone as a team—with other department chairs who were on the same page," Smythe says. "We were all zeroed out at the end of the year and were not allowed to grow empires. Almost everything has to be rationalized with a colleague. There are ways to do things with the capital budgets, but give me a list of 10 health systems where the departments give all their revenue back at the end of the year."
Even having physicians manage budgets presents a training issue. Paul Dieckert, MD, chief quality officer for Scott & White Healthcare, says when he joined the organization in the mid-1990s there was only a handful of physician leaders with any sort of business training.
"One thing that just struck me was we didn't have any physicians who were leading the organization who had been trained in any kind of business principles, or even leadership principles," Dieckert says. "We did have some natural leaders, and they were doing a good job." So he asked the board at the time if it would support him going to the University of Texas to get his MBA. The board agreed, and now there are 40 or more physician executives who have MBAs.