What Good Is A Broke Doctor?

Screen Shot 2015-02-22 at 1.45.24 PMI was invited a few years back to give a talk on vaccine management. The audience was mainly adult doctors from various specialties. My assignment was to pull back the curtain on how our pediatric practice managed vaccines.

In preparation for the talk I spoke to several family practice and internal med practice managers to understand what were the obstacles that steered their practices away from giving vaccines.

The practice managers I spoke with said that the time, risk, cost and poor return on their investment made it difficult to justify carrying vaccines. It wasn’t worth it to them.

With that information, I structured my presentation with the message that “vaccines are good for patients and good for business.”

One of the sponsors of the event was a vaccine manufacture and a representative from the vaccine company was present during my talk. I received word afterwards that the sponsors did not like my “…vaccines can be good for business” tone and I should tone it down in that regard.

Let me get this straight, I said to the messenger, a pharmaceutical company, which makes billions of money ON VACCINES, is telling me that I can’t talk about making money with vaccines? The messenger said, yes. They want you to focus on storage, logging refrigerator temperatures, proper vaccine handling, etc.

A few weeks later, the issue of profitability centered around the flu vaccine came up in a discussion. I shared with the group that the flu vaccine is profitable for our practice. Not huge margins, but certainly not a loss.

A primary care physician announced to the group, that we ought to be careful what we disclose because insurance companies may find out. The gentleman was implying that this profitability “revelation”may be harmful to physicians in the form of lower payments.

I find these two incidents disconcerting. This implicit taboo-like mentality that shuns people away from discussing healthcare is a business (thus profitability needs to exist) needs challenging. Talking about cost, revenue, margins should not be kept quite or even discussed discretely. On the contrary. We need to make people aware.

Besides doctors, who in healthcare does not embrace profitability? Pharma? EMR vendors? Malpractice attorneys? What about Welch Allen or McKesson? BCBS? United Health Care?

I believe private medical providers have an obligation to be profitable. Profitability allows us to buy the best technology, hire the best doctors, nurses, staff, buy the best equipment so that we can offer the best pediatric care. Does the grocery store apologize for making a profit by fulfilling a biological need? No. Of course not. Then why should doctors?

Simply put, we can’t help people in need, if our practices are in need ($$) too. Profitability allows us to continue providing healthcare services.

Here is a challenge. Let’s talk openly, candidly and honestly about making a profit. Our livelihood depends on it.

Deal?

Small or Big: What is the future of small private practices?

Many experts and pundits are predicting that the downward pressure we are seeing in healthcare will claim small independent private physicians first. Those that are not affiliated or belong to a hospital or large healthcare network will not survive, say the pundits.

The argument is that these small practices will not be able to withstand the financial and administrative pressures of the new healthcare landscape.

Others very eloquently argue that if we don’t band together soon, and form larger groups, they will not have a seat at the table when the time comes, therefore forcing them to accept a deal that may not be in their best interest in the future.

It is like jumping on a large tanker to survive a huge storm or last longer at sea without returning to port. Which is a good strategy, I guess. If your goal is to cross the Atlantic back and forth, a small independent ship may not be the best strategy.

But to me, jumping on a larger vessels dismisses the fact that there are other destinations… destinations that can be reached far easier on a smaller boat.

Jumping on a big ship, you dismiss the opportunity to go up and down the coast, making lots of stops, go in and out of ports, explore new islands and have a say on where you want to go everyday. The large vessel, once it sets its course, it is set.

The big vessel does have many advantages, like protecting you better from a big storm. Nevertheless, that doesn’t mean that a smaller vessel can’t maneuver faster around the storm or find shelter in another port.

I do acknowledge that we are being squeezed in many ways, and I agree that many will eventually go out of business, fold or simply disappear; but I don’t believe there will be a massive small private independently own practice extinction.

If anything, I see this as a huge opportunity for those of us that are small, flexible and nimble to adapt to the new challenges of the healthcare industry.

Something to think about…

Amazon might have driven Borders out of business, but they haven’t put “writers” out of business. iTunes has changed how consumers buy music, thus crippleling the record labels’ business model, but iTunes hasn’t put artist out of business. If anything, they now have more distribution channels than ever.

The Internet is challenging the newspaper industry, but we don’t have a shortage of journalist.

McDonalds and Burger King mass produce hamburgers, but we all know of a place that sells the best burger in town.

Expedia and Travelocity might have driven travel agents out of business, but it has not bankrupt hotels, beach resorts, bed and breakfast and cruise lines.

There are going to be opportunities. It is just a matter of figuring out how the delivery of care will change.

Now, I’m not suggesting that becoming part of a larger entity is a bad strategy. But what I am suggesting is that it ought not to be the only strategy.

Personally, I believe that smaller practices will be positioned uniquely to transform the healthcare landscape. How we “deliver” medicine may change, but I believe that these larger groups cannot, and will not fulfill every single need.

And that is where some of us will jump in.

Does your practice need a business manager?

When we first opened our practice, we knew we needed to hire an office manager to handle paying the bills, managing the staff’s time of and buying all the office supplies. But we didn’t anticipate that we’d need a business manager.

Soon after we opened, it was apparent that the practice needed a business manager – not an office manager – but a business manager.

Medical practices are relatively complex businesses. And they generate a lot of cash when you compare them to other small businesses. Thus, a practice should have a “qualified” business manager that manages the practice for physicians in order to run the business efficiently.

In my experience, I’ve seen physicians give this position to nurses and in some cases, medical assistants with a knack for organization. However, unless they have specific knowledge and experience with running a business, I don’t think they should be left solely responsible for managing the business.

Giving a nurse or a medical assistance with a propensity towards business is like Derek Jeter giving his batboy the reigns to his career on account that the batboy “knows” baseball.

Now, before I get angry emails from nurses and medical assistance, let me say this. I’m not saying nurses or other staff members can’t run a practice.

But what I am saying is that ideally, he or she should have working smarts in areas such as operation analysis, data processing, finance, accounting, budgeting, purchasing and personnel. Knowledge of computers, networking, Internet technology and design are also helpful.

But what if the doc is the business manager? Sure, the doc can be as involved as she wants to be. But it shouldn’t distract her from doing what she does best; which is, see patients.

Doctors spending time doing business management stuff is like a Derek Jeter spending time as an “agent” and not playing baseball.

I know, getting a business manager is easier said and done. It takes time and effort to find someone trustworthy. But don’t let that sway you from the initiative of finding someone.

Hiring a business manager will result in an increase in convenience and timesavings. Furthermore, although hiring one will cost you money, the expectation for this person is clear… increasing return for the practice.

There is something to be said about hiring a person that will devote their full attention to managing one’s practice.