Rightsizing Your Physician Practice's Staff

How many staff members do you need to maximize productivity and quality while containing costs?

The bible of practice staffing ratios, Rightsizing: Appropriate Staffing for Your Medical Practice by Deborah L. Walker and David Gans, notes that understaffing can negatively impact employee recruiting and retention, disrupt physician productivity, hinder patient service, and place patients and business operations at risk.

On the flip side, Walker and Gans note that overstaffing can lead to poor staff interactions with physicians, a decrease in productivity, and a decrease in the bottom line.

Adequate staffing is one of the more complicated and important issues in healthcare. It's a nettlesome problem that every practice manager will face at one or more points in his or her career.

The issue gets cloudier when you factor in the dearth of qualified clinicians in most areas of the nation and try to determine the impact of healthcare reform and the adaptation of meaningful use for EMRs in your physician practice.

Fortunately, the answer to the question of what determines adequate staffing is simple: It depends.

"It is a balancing act. The more physicians you have, the more patients you see, the more staff you should anticipate to take care of them," says Christopher Clarke, practice administrator at South Coast Orthopaedic Associates, an eight-physician practice in Coos Bay, OR. "But you can't get to a level where it's just going to be breaking even. You have enough staff to take care of everybody, but you aren't making money. That is where you have to push the efficiencies."

Clarke says South Coast Orthopaedic stresses cross-training with its five mid-level providers, four physician assistants, and 15 other staff members.

"We do a lot of cross-training—and not just within departments. Each billing staff [member] can do every job in billing," he says. "We also cross-train our medical assistants to work at the front desk; the chart room people too. Anyone can answer the phone. We try to make sure that everybody is cross-trained to the best level possible. That really helps with our efficiencies."

Generally accepted staffing ratios can vary greatly depending on the subspecialty. Clarke says the Medical Group Management Association best practices recommend 7.7 full-time employees (FTE) for each full-time physician at his orthopedic group. "We are at five FTEs, and a lot of it is the efficiency of our staff," Clarke says. "You have to make sure you have the right people in the right jobs being as efficient as possible, and you have to evaluate that and watch your staff."

Staff size by formula

Barbara Daiker, executive director of NorthwestEye, which serves the Twin Cities area of Minnesota, says the 21-physician group uses a formula to determine staff size. "But it's not by doctor. We do it by encounters. We look at how many encounters a doctor has, and we try to staff accordingly," Daiker says.

NorthwestEye, which has 150 employees serving eight clinics and one surgery center, has developed specific encounter ratios for clinical and front desk staff.

"We also use a different kind of number for our business office, based on revenues, FTEs per revenue, so they're handling dollars as well," Daiker says.

With its encounters, NorthwestEye also takes into account the number of tests ordered. For example, the patient visit itself is a single encounter, but some patients may have two or three tests during their visit, and those may have to be included.

Even using the ratio can be a bit of a challenge as the physician group encounters ebbs and flows of patients in the annual business cycle.

"It's a bit of a floating number," Daiker says, adding that NorthwestEye is currently in its seasonal lull. "We can't change our FTEs per se, based on the lull. We have to ask, 'What do we think will happen over the next six to nine months?' and see if we can flex the hours a little bit now based on where we think we are going to be once we hit our busy time. We don't want to do any kinds of layoffs or staffing up until we can be sure where we are."

Unexpected stability

The recession and overall economic malaise that have gripped the nation for more than two years have had at least one unexpected upside for office administrators: Staff is staying put.

"We have had no resignations for four or five months at this point, which is a long time for us. It's not like we are a place where people bail from, but people get relocated or they have babies or whatever, so it is kind of unusual to go that long," Daiker says.

When a job opening is posted, NorthwestEye gets flooded with applicants who aren't necessarily qualified. "That makes it hard because you have to sort through a lot of stuff to find qualified applicants," says Daiker. "It used to be recruitment was expensive when the labor market was tight. Now, it doesn't cost much to recruit, but it is the training, the orientation, that takes a lot. Even if they come from another eye group, they don't necessarily know how to do it our way."

Although cutting back hours to maintain adequate staffing is preferable to layoffs, it can still get tricky. "We try to solicit reduced hours from employees, but you can only do that so much before people get skittish," Daiker says. "We try to be fair. It's easier for everyone to lose an hour than it is for one person to lose eight hours. Also, because we are in Minnesota, when the weather gets nicer, people are a little more open to cutting back some hours and heading outside."