Many years ago, a newly hired physician practice manager attended his first meeting of a professional association for practice administrators. During the typical introductions he had an opportunity to meet a seasoned manager who had been in the business of managing practices for nearly thirty years. The only piece of advice that the sage administrator had for his young colleague was to anticipate changing jobs every five years. “Either you’ll get bored with your job or the physicians will get sick of you” was to become an accurate prediction of the career path of more than one manager.
Anyone who has ever had an opportunity to manage an organized group of physicians can certainly see that tenures are short and frustrations are high. Managers of smaller groups seek the challenges, and added incomes, offered by larger groups. Mergers between medical groups produce “musical chairs”-like situations, in which at least one manager must go, and personality differences between physician leadership and management always end in the manager being given the opportunity to devote full time to seeking new employment.
Can this situation ever change? Can physicians and managers create lasting, and mutually beneficial relationships? Can management skills evolve as organizations change? Unfortunately there are no clear answers to these questions. What is known, however, is that lengthy associations between managers and groups are rare. Let us examine some of the dynamics of managing medical practices that contribute to turnover and explore what can be done to avoid the pitfalls.
The Typical Group Practice Manager
There isn’t one. Some managers begin their careers as receptionists, bookkeepers, or billing clerks and, over time, gain the knowledge and skills needed to assume more responsibility. Eventually, either due to practice growth or the departure of a former manager, they move into the top spot. Other managers are second-career professionals that began as accountants, bankers, military officers, clinicians, or hospital administrators. More recently, new managers seem to split between those with a business education and the internally developed, on-the-job-trained former staffer.
Regardless of prior education or experience, there are certain traits that are common to all managers. They are either process-focused or strategy-focused. This is not to say that a competent manager that is typically a roll-up-your-selves, hands-on manager is not able to view the larger picture. Conversely, strategic thinkers can have an excellent grasp of the steps necessary to improve office procedures. Most often, however, managers tend to be more comfortable with one style or the other and many will seek out employment situations that allow them this focus. The strategic thinker may find themselves unchallenged in a small practice that requires daily involvement in staffing issues, billing problems, and staff/physician conflicts. Equally frustrating, this time to the process-focused manager, is a practice that continually questions the need for certain process and rejects “business as usual” habits.
Managers need to understand their basic style and be able to identify the organizational mentality of the practice. Also possible is that the current organizational personality is really a reflection of the style of the manager but, after further analysis, it would be better served by a personality shift. More on this later.
Managers vs. Physicians
Most managers blame unsuccessful practices on the leadership shortcomings of the physicians, and many physicians will place blame on the manager for not being in touch with the needs of the practice. Both can’t be right, or can they?
There is a basic fact about managers and physicians that cannot be overlooked. The physicians in a practice have a common bond, they are physicians. This means that they were educated in a similar style, have a similar knowledge base, and often have a similar approach to problem identification and solution. Even though they may not all get along on a personal level they are colleagues on a professional level. Managers are different. They are not physicians (with rare exception), they come from very different experiential and educational backgrounds, and many think like their business training has taught; there are situational solutions and tradeoffs that must be considered. Physicians tend to deal in absolutes.
Managers must always remember that they are running someone else’s company and that, usually by law, they are excluded from ownership. Hospital-affiliated practices are structurally different. The manager is the representative of “the owner” and, as a result, seen as a representation of all perceived problems. Very few practices work diligently at establishing positive dialogues between managers and physicians and setting out clear goals and responsibilities.
Managers may have the intellect to become physicians, but the law requires that, without the license, they stick to managing. Physicians, however, can, at will, become managers and it would be a difficult argument to suggest they are not intellectually capable. Physicians, however, are seldom educated and trained in medical management.
The differences between managers and physicians, highlighted above, are the seeds of misunderstanding that, when they take root, grow into mistrust. Managers need to understand an absolute; when differences occur between physicians and their manager the outcome is already known.
Understand Your Style
Success in medical group management is not unattainable. It is, however, not as easy as “doing a good job”. Talented, intelligent, experienced managers have had very short tenures in some employment situations. It is not a result of inadequate skill but, rather, a lack of style fit.
Briefly, there are two aspects to focus, strategic vs. process, and two aspects of style, intervention vs. maintenance. All managers, regardless of their education or experience, are a product of the interrelationship of these four elements.
Strategic Focus- the strategist has a marketplace orientation. They attempt to understand and track shifts in payer policies, reimbursement trends, the hospital/physician dynamics, and the overall regulatory environment. A strategic focus will result in an awareness of competitive resources. The strategist will develop bold new directions for the practice and will view change as a necessary component of group success.
Practice physicians may view this style as disruptive and they can develop a sense that more time needs to be spent fixing internal problems rather than divining new directions. The manager will respond by indicating that effort spent in maintaining outdated office procedures is wasteful and only change will provide for future success. These perceptual differences foretell of an upcoming departure.
The strategist may also find resistance in the staff. Typically, front line workers value the stability of “sameness”, and resist abandoning a known process for one that is untested. The manager must also recall that the staff works closely with the physicians and, frequently, they have access to their ears most of the day. The strategist may be boldly leading the organization into the future while the rest of the physicians and staff are back in camp, tending to the fire.
Process Focus- the proceduralist has a task focus. Process-focused managers will, typically, be diligent in the creation of position descriptions, work flow procedures and policies, and have a willingness to work with staff to assure that problems are overcome.
Staff will be quick to bring problems to the proceduralist because he or she will work to find a solution. Once the problem is passed to the manager it is no longer a concern to the staff and they will be quick to inform the physicians that they fulfilled their obligations by passing the buck.
The process-focused manager will be more aware of the reimbursement for a certain CPT code than overall trends in payer patterns, they will view regulatory change as a need for new policies, and they will focus on refining staffing patterns in response to increases or decreases in practice volumes. Typically the process-focused manager arrives early and leaves late and their desk is piled with journals and newsletters that are there, unread, because they were busy “putting out fires”.
Physicians value the attention to detail of the process-focused manager. Unfortunately, they may also view this focus as an indication that the manager is not a “big picture” thinker and may ignore the manager’s recommendations and observations about larger strategic concerns. The manager becomes branded as a worker, not a leader. If a practice encounters unexpected problems from revenue shortfalls, or competitive initiatives, the manager is typically blamed for not anticipating the problem. Practices will quickly recruit a strategist who, while different, may not be any more successful.
Interventionalists- these managers are always changing work processes, quickly deciding if staff have the competencies to accomplish a job (and making changes if they don’t), and they expect equally quick action from subordinates. Their style is directive because they don’t have the time or patience to work through others.
These managers run the same risks as strategists. The staff that did not embrace the evolutionary change of the strategist will also resist the procedural changes of the interventionalist.
Interventional managers work well in “broken” settings where change is clearly needed and their willingness to step in and offer solutions is valued. Once the crisis passes, however, their need to continually fine tune operations can be viewed as creating unnecessary turmoil. These individuals are often some of the most transitory of managers as they seek new challenges and problems. They become bored with stability.
Maintainers- teambuilding, staff development, and operational stability are the goals of the maintainer. While group hugs may not be evident the bottom up approach goes far in creating a sense of group and functional harmony.
The focus on group process results in a lessened ability to quickly respond to needed change. All change is viewed in terms on staff impacts, process impacts, and what could be called “pain impacts”; is the change worth the pain.
Maintainers may take disharmony personally; they identify with a harmonious organization and work hard to make each employee feel valued and empowered. The result is that they receive the loyalty of their staff, or they are the subject of manipulation and gaming by those that are less focused on the greater good.
The approach of the maintainer is excellent for the stable and healthy organization. Physicians perceive the positive working relationships that are developed between traditionally competing work groups (front desk vs. the clinical area) and the avoidance of crises. Physicians are often the ones to perceive the need for changes and, as a result, take responsibility for any destabilization that may result. The maintainer, however, will not be as successful in an organization in crisis, unless that crisis is the aftermath of recent change.
Physician Leadership
It is equally critical that a manager understand the leadership style, or lack of style, in the physicians who are designated, formally or informally, as the practice leadership. Simply being President of the practice is not sufficient for a manager to assume that this individual is the driving influence in the practice.
Practice governance structures fall into a few predictable categories: 1) committee rule- this is the ultimate democracy where everyone has a voice in how a practice functions and no decision is final until everyone agrees. Should a physician change their mind, the decision needs to be revisited, 2) strongman rule- one dominant physician, perhaps the practice founder, makes all of the decisions, with or without input from their colleagues. From a manager’s perspective, this may be the most stable model for survival, if the strongman likes you, 3) Board rule- if the Board is well developed, and its membership understand the role of the Board, this can be an excellent way to bring many views into the governing process. If the Board is unable to reach decisions, is unwilling to enforce the decisions it does make, or provides little guidance to its manager, this model can be professional suicide for a manager.
Typically, the larger the practice the better the governance. The relationship is not accidental, it is causal. Without effective leadership the future of any practice is limited. Dynamic strongmen eventually retire and they seldom take the time to develop others within the practice to assume their role. Frustrated physicians with vision will often leave a committee-led group because nothing gets accomplished. Ineffective Boards will allow selfish and disruptive behaviors, on the part of physician colleagues, that may result in the departure of more group-focused individuals.
Teaching Boards to govern cannot be a task left to the manager. Either the physicians and administrator need to attend governance retreats or consideration should be given to engaging a strategic consultant to help facilitate the process. If the manager, no matter how talented, attempts to develop the Board’s governance skills they will be perceived as manipulative.
About Survival
Longevity in group practice management will be determined by the success in matching manager behavioral style with the organizational personality of the group. Any manager that does not want to follow the path of the young colleague described earlier should take the time to interview the group, as the group considers the manager. It may be equally beneficial to interview the former manager, or managers.
Begin your career stabilization program by first determining your style, from the options presented. Are you a “strategic interventionalist”? How about a “procedural-focused maintainer”. No matter what your style may be, there are group settings that are appropriate, and inappropriate, for you. While the group dynamics and situation may change over time, resulting in a mismatch, chances are that your tenure will still be longer than if you accept any offer that may seem attractive at the moment.
It may be helpful to match manager and group profiles as an example to positive and negative fits.
Strategic Focus
Interventionalist- It is unlikely that you will retire from your first group affiliation. These big picture thinkers use organizational change as a management tool. Typically they will be early adopters of new technologies, become easily frustrated with staff that finds reason why change is bad, and can visualize where the practice needs to go but doesn’t want to become involved in the process.
What to look for: merging practices, large group practices with a well organized business structure, hospitals divesting their practices, practices in serious financial trouble, practices with effective Board governance, management consulting firms.
What to avoid: small practices, most strongman and committee environments, don’t follow a well-liked proceduralist (who died or retired), hospital-affiliated practices (move too slow).
Maintainer- you could do very well in a large group setting. Your external focus will serve the group by keeping abreast of the changes in the environment while your desire for smooth operations will provide the stability and support that staff and physicians value.
What to look for: large or medium sized groups that have a detail-focused operations manager or assistant, becoming the first manager for a group that is growing, following a failed process-focused manager. This style could do well in a strongman situation.
What to avoid: turnaround situations, small practices, committee and dysfunctional Board situations.
Process Focus
Interventionalist- this combination of traits is the managerial equivalent of a perfectionist. You want things to work well and you are not afraid to step in and make the changed needed to make improvements. Most likely you are a hand-on manager and you expect the same level of effort from your staff.
What to look for: small to medium practices that are organizationally healthy, but could sharpen their performance, a role as the COO to a strategic focused interventionalist, a larger practice, post merger, which has already gone through its first manager. Some turnarounds may present attractive challenges.
What to avoid: practices with physicians who like to become involved in operational issues, or encourage staff to come to them with issues, being number 2 to a person with a similar style, practices that have no clear strategic focus.
Maintainer- you’ll keep the ship moving down the channel but you may find it difficult to handle a storm. This style is common in managers that have developed within the practice and have now assumed leadership. You get along well with most physicians but may be viewed as an obstruction by more aggressive physicians. This combination of traits seems to lead to greater longevity in management positions.
What to look for: Any governance style so long as the practice is healthy, COO to a strategic maintainer or CEO to a process-focused interventionalist. Small practices are like home. You may enjoy a practice where the physicians play an active role in management.
What to avoid: merging practices, working for an interventionalist, turnarounds.
What’s Ahead?
Group practice management is a bit like being a radio DJ. Experience gained in smaller practices leads to bigger opportunities. Bigger opportunities lead to increased income. More visible positions, however, also have higher risk factors associated with perceived manager performance. When ratings slip the DJ goes.
Most managers will agree that, for the most part, the reimbursement picture will not get dramatically better so effective management of financial resources will be a key skill. Government regulation, especially the new privacy rules, have the potential for creating huge costs and requiring massive process changes in practice operations. Adoption of technology, such as Electronic Medical Records and updated practice management systems will not be an option but, rather, a requirement. Again, this means new capital expenditures and process changes.
Patient expectations for enhanced customer service will only increase and lessened managed care restrictions on which physicians can be accessed will require that all practices provide more responsive service. True clinical quality will mean little if service quality is poor.
Practice success will depend on the folks in the Business Office. Their ability to keep current with coding changes, payer policies, claims requirements, and effective management of receivables will be the difference between positive and negative cash flows. As overhead increased physician incomes will further erode and the doctors will look to the manager to reverse the trend. Physicians will find it harder to grant meaningful manager and staff compensation increases in the troubled financial environment and some of the best people will seek alternate professions, especially those managers with an entrepreneurial attitude. We may yet see a re-birth of the Physician Practice Management Company concept in a national MSO model, without the equity component. The entrepreneurs will be drawn to these ventures.
Managers who match their expectations to the realities of the market will continue to do well and they will be professionally satisfied. Those that fail to understand how their style effects their success will continue to struggle with professional frustration.
The young manager, described at the beginning of this article, actually exists. His career was, in fact a series of 3-5 year positions. Everyone agreed that he was one of the most talented and knowledgeable of managers but, after a few years, grew bored with the challenge once he had fixed the available problems. He came to understand that he thrived in turnarounds and stagnated in day-to-day operations. He began a successful career as an interim manager and consultant.
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