Medical Practice Management – the Deadly Sins of Practice Failure

Medical Practice Management – the Deadly Sins of Practice Failure

Medical practice management - the deadly sins of practice failure

{loadposition hidden-adsense-block-intro}Certain basic assumptions abound in healthcare. The first assumption is that skills are enough to open a practice or business. The second assumption is that office managers are responsible to run practices so physician/owners can direct their attention to delivering care. The third assumption is that practice management and business management are one and the same. The fourth assumption is that physicians earn income only when seeing patients. Underlying these assumptions are others, and all are a recipe for practice failure.

{loadposition hidden-adsense-block-story}Assumption: Medical practice management

Delegation is the act of empowering or representing the interest of others. Abdication is giving up responsibility to others with no intention of resuming it. Physician/owners prefer to abdicate financial and administrative responsibility to office managers and staff. While the office manager is valuable to the practice’s day-to-day operations, the vision and strategy for long-term and diversified growth of the practice can only be crystallized by Dr. CEO, a.k.a. the practice owner. Employees are vital and central to the success of all medical enterprises. However the rule of thumb, in any business, is that no employee should become so important that replacing them could derail the practice.

Assumption: Physician time and money

Physicians/owners are not taught basic business strategy and design in medical schools, nor are there any CME credits offered in the subject matter. The thought of taking thirty percent of their time focusing on the business of their practice is difficult to comprehend because they assume that money is made only when seeing patients. What is not understood is that accountability, R&D, and practice evolution contribute to sustainable incomes not just seeing x amount of patients daily.

Assumption: Practice Management vs. Business Management

Practice management, commonly taught in most health organizations, focuses on the processes that support the delivery of care. Business management focuses on the business of medicine. That includes business design, strategy, and implementation processes responsible to support practice success. Business management provides the platform by which practice management succeeds. Generally assumed to be an accounting or MBA graduate function, most accountants and MBAs are not engaged or involved with physicians in that aspect of business; nor is collaboration encouraged. Physician/owner involvement is an essential prerequisite for success. Healthcare, whether for profit or not for profit, must be a business first, if it is to survive. Physician owners are business entrepreneurs and, in most cases, their practices are for profit enterprises, but they are not recognized as such or treated as such.

Assumption: Expert skills create viable businesses

All too often experts with a certain set of skills choose to open a business with the assumption that their skills are in demand. However true that may be in healthcare, it is not enough to open a practice of any kind without understanding how to run a business.

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