AANS Neurosurgeon asked neurosurgeons “at the top” in private practice and in academic practice to share their experiences as business administrators.
Panelists are Patrick J. Kelly, MD, FACS, Joseph Ransohoff Professor of Neurosurgery and chair of the Department of Neurological Surgery at New York University Medical Center, New York, N.Y.; Troy D. Payner, MD, president and managing partner of Indianapolis Neurosurgical Group, Indianapolis, Ind.; A. John Popp, MD, FACS, professor, Henry and Sally Schaffer Chair of Surgery, co-director of the Neurosciences Institute and head of the Division of Neurosurgery at Albany Medical Center, Albany, N.Y.; and Richard N.W. Wohns, MD, MBA, founder and president of South Sound Neurosurgery and chairman of the board of NeoSpine, Puyallap, Wash.
Questions are:
- Which practice management pearl do you most wish you had
known when you finished your residency?
- What was the hardest lesson to learn during the course
of your career with regard to practice management?
- What in your experience is the most effective management
strategy for your type of practice?
- What in your experience is the greatest error you have
seen in management of your type of practice?
- What advice would you offer to neurosurgeons beginning their careers on how to plan for success in neurosurgery?
Readers are invited to add to this dialogue on success in the business of neurosurgery. Responses and comments sent with the author’s full name and title to [email protected] will be selected for publication in the next issue.
1) Which practice management pearl do you most wish you had known when you finished your residency?
Dr. Kelly: That they (institutions) need us more than we need them. We have something that no hospital administrator can ever have or easily replace.
Dr. Payner: Create positive relationships with those people who make your day efficient. This applies to the office and to the hospital. The business of medicine is all about people management. Staff members who understand they are making a positive difference in the situation and are recognized for their efforts will continue to do that consistently. I have also learned that the staff and managers of a successful employer feel like they are part of the team, able to recommend changes and new ideas. Try to recognize that some people are suited for certain tasks and put them to work at those tasks. This helps keep a stable workforce and lessens the disruption of constantly hiring and training new people.
Dr. Popp: That management is a team sport, and it is valuable to understand each player’s role. When I finished my training, I knew nothing about the business aspects of neurosurgery. As a junior faculty member in a neurosurgery department I was somewhat insulated, but when I became chair I felt that I was in a maelstrom and knew I had to educate myself in this area. I became a member of the American College of Physician Executives, and I took a two-week total immersion business course.
Dr. Wohns: That you must be a savvy businessperson. In my own training, there was no discussion of anything related to practice or running a business. In those days, circa 1983, you could go out, set up shop and do well. I worked 24/7 building a practice and managing the workload and didn’t think of the business. By the early 1990s, it was clear that the environment had changed and that you had to pay attention to business. This led me to business school in 1995, where I learned all of the business basics and wrote a business plan with other doctors. I eventually reinvented myself and my practice with a focus on outpatient spine surgery and have really enjoyed my career ever since.
2) What was the hardest lesson to learn during the course of your career with regard to practice management?
Dr. Kelly: To understand what your time is worth and that Medicare, Medicaid, many HMOs and insurance companies are screwing us. It’s really simple: (1) Add up all of your expenses (malpractice insurance premium, office rent, secretarial salaries and benefits, etc.) (2) Determine your costs per hour by dividing your annual office costs by the number of hours your office stays open per year. (3) Drop any third-party payer that pays less for a time-consuming service than your per hour costs for doing business. If you actually think that your own personal time is worth something, add in what you think your time per hour is worth.
Dr. Payner: There is never enough time to spend on managing the practice. It is very difficult to give up clinical time or personal time to manage a large neurosurgery group. One must commit to dedicating an appropriate amount of time to spend with administrators and physicians within the group as well as keeping in regular contact with hospital administration. Managing a neurosurgery group is very complex today. The pressure from declining reimbursement, rising costs, and government regulation should be the motivation for carving out time to manage the practice.
Dr. Popp: I recognized very quickly that it was hard to “do management” at the beginning or at the end of the day because the necessary people simply weren’t around. It’s hard to intersperse management activities with clinical responsibilities, so it is important to schedule dedicated time to bring together various team members.
Dr. Wohns: The realization that you can’t be everything to everyone in neurosurgery can free you to be self-directed and proactively choose a career path that suits you. In management of a practice, this realization helps you to keep your focus on neurosurgery and patient care and allows you to hire skilled others to handle the day-to-day particulars of the business.
3) What in your experience is the most effective management strategy for your type of practice?
Dr. Kelly: Hire good people and let them do their jobs. Cut loose incompetent and lazy people early on. Most importantly, define priorities. Mine are the following: (1) Almighty God; (2) the patient on the operating table; (3) my family; (4) my residents; (5) my neurosurgery colleagues; (6) the nurses who work with me; (7) referral sources; … and (15) hospital and medical school administrations.
Dr. Payner: Building consensus to implement change. It is best to discuss an idea first with the people who you think might oppose your plan. By listening to their concerns you can address those issues before they become deal breakers. Once you reach a compromise with them, gaining acceptance from everyone else is easy.
Dr. Popp: There are several elements, but all center on people. You need “face time” with faculty members on a regular basis to develop close working relationships, as well as regular meetings with those to whom you report-the dean, hospital director-to effectively represent the faculty to them and to convey hospital policy to the faculty. Training exposes residents to organizational dynamics, and chief residents have a lot of administrative responsibilities. Developing a matrixed way of making it all work is a key to success.
Dr. Wohns: I’ve learned to be an enabler and big-picture guru of the practice rather than the person who is doing it all. After I began delegating to skilled others, the practice grew from three to 45 employees.
4) What in your experience is the greatest error you have seen in management of your type of practice?
Dr. Kelly: Micromanaging and believing that institutions that demanded your loyalty would actually be loyal to you when push comes to shove.
Dr. Payner: Waiting too long to deal with a tough situation. I have found time and again after finally dealing with a tough situation that it probably would have been better to have dealt with it much sooner. Whether it is a behavioral issue or a poor business decision, try to resolve the issue quickly. Often, people want to wait to see if the situation will “work itself out.” This rarely happens in a good way. It’s better to come up with a plan, put it into action and move on. Right and wrong is sometimes a gray area in these situations. I have found that just doing something usually makes the situation more tolerable and generally resolves the issue.
Dr. Popp: I get the sense that in some institutions, physicians are perceived as a necessary evil-a pain in the neck and not important to the institution. But there is no example of a hospital administrator who has ever admitted a patient to the hospital. As the business of medicine grows more complicated, decision-makers in medicine frequently are not physicians. Nobody knows more about delivering excellent patient care, however, than a doctor or a nurse. To decipher the insanity that surrounds us, medical professionals who also are educated in and knowledgeable about business are essential.
Dr. Wohns: Micromanagement doesn’t work. I learned the business of neurosurgery-microeconomics, marketing, strategy, management concepts, human resources, accounting, efficient scheduling, etc.-and was able to micromanage, then realized that doing so would take all my time. I was in neurosurgery to help patients, and to do that I would need to give up micromanagement of the practice. Now my management style is that I understand what everyone’s task is and, while I oversee everyone, I don’t get in their way.
5) What advice would you offer to neurosurgeons beginning their careers on how to plan for success in neurosurgery?
Dr. Kelly: Three points:
1. Avoid the big cities initially. Go to places that really need neurosurgeons.
Do a bunch of cases. Develop an interest in a part of neurosurgery that few
people want (i.e. don’t jump on the bandwagon du jour). Write a bunch of
papers. Give a bunch of talks. Become famous. Then move to the big city.
2. If you take a university job or a job at a large institution, take it with
the understanding that they are using you. So you use them to build up a huge
case volume at their expense, become famous and then move on.
3. Never make a lateral move (for example from assistant professor at one institution
to assistant professor at another institution) unless it’s for one heck of
a lot more money or opportunity.
Dr. Payner: I feel very fortunate that I have such a strong passion for neurosurgery and that I get to do it almost every day. However, this can make me vulnerable to those who may try to capitalize on my dedication. To be successful, neurosurgeons must leverage their expertise and value. Most neurosurgeons have significant leverage to negotiate with hospital partners, payers, vendors, and other third parties. Always be willing to evaluate and investigate opportunities to enhance market share. Do a thorough analysis of the opportunity. Have a realistic bottom line and walk away if you do not get it. This is sometimes difficult to do, but it is the only way to get the best deal for whatever you are negotiating.
Dr. Popp: I would encourage residents to educate themselves on practice management topics and to avail themselves of courses that help them prepare for the real world-which can be a cold, cruel one for those who are unprepared. Socioeconomic courses are offered increasingly by training programs and by organized neurosurgery, including the AANS. Part of the change in the neurosurgical education paradigm is to help residents better prepare for the business of neurosurgery.
Dr. Wohns: Take a practice management course and learn about coding, billing, and financial management. I would not recommend starting out on your own. Join a practice that is successful, with good business practices in place and with a vision and business objectives consistent with your own. You should gauge how well you will get along with potential colleagues on a clinical and on a personal plane. Also, the only thing constant in our specialty is continual change. A formula that works today may not work next year, so you must stay current, be vigilant, and try to do the things you enjoy in large volume.