No-man's land

At the moment I am attending a seminar sponsored by the Kansas Medical Society entitled “Revitalize Your Medical Practice: Creating a High-Performance Work Team.” The nationally-known speaker is a guy like me – about my age (60), and a graduate of a family practice residency and teaching fellowship. The differences are that Harvard Medical School turned me down, and I returned to family medicine after six years in the emergency room. He stayed.

He makes a number of well-researched points that are worth considering in detail, but here’s an important one: The four critical competencies for physicians in 2009 are clinical ability, productivity, teamwork and bedside manner.

This blog is dedicated to the second of those four, and he mentioned in passing that some office-based physicians seem to be under the misimpression that they are owed a living for seeing 10 patients a day. This echoed something TransforMed’s Jim Arend told me a couple of years ago: that some of their test practices thought they could make it in family medicine averaging 16 patients per day per doctor.

They can’t. Here’s why.

Aristotle’s Golden Mean (like Jesus’s Golden Rule, Kant’s Categorical Imperative, Mill’s Utilitarianism, and all other deservedly “great” ideas) is only true most of the time. When it comes to practice staffing and structure, the Golden Mean isn’t desirable.

Between micropractice and full speed ahead is no-man's land, a place where you have all the pains of modern clinical practice, and none of the rewards.

Micropractices are the Amish of family medicine: They enjoy the simple pleasures, and accept a lower salary. They are rarely under time pressure, but they file their own insurance claims and empty their own trash.

Most of us see the appeal of that style, but for one reason or another have chosen a different path. We hire people to answer the phones, file the paperwork, and check patients into rooms. The pain comes from managing those people. The rewards are financial, we hope.

With that payroll comes a moment of truth every payday. You, or another person you hire, write a bunch of checks and live on what is left over. The problem with family medicine is that there is not enough left over to attract medical students into our specialty.

Physicians don't get rich unless they manage insurance or pharmaceutical companies. We are all – specialists and generalists alike – piece workers, just like teenagers stitching together Nikes in Sri Lanka. Our "pieces" are charge codes or, as a matter of shorthand, our patients. If we manage physician extenders, we may profit to a small extent from the labor of others. But not much. It's mostly on our backs.

Now the key question: How many patients a day do you have to see before you earn your first nickel? That is, how many patients does it take to simply pay your bills? 

The answer to that question depends on a number of variables, but in general it will be in the low teens; say, for the sake of argument, 13. When you get to 14 a day, you're making (a little) money, maybe $100. That's $2,000 per month, right up there with a full-time Wal-Mart greeter.

Bump it up to 18 a day, and you're an average family physician at $120,000 per year. You're keeping the entire profit from those extra five patients. The rent is the same, the staffing is the same; your supply costs went up a little, and everyone is working harder. The medical students still aren't interested.

But let's say you could average 25 per day. Now you're going to need a bigger office, and at least one more nurse, so the break-even is up to 15 patients from 13. But your profit from patients 16 through 25 is $240,000 per year. You can bank it, or you can take more vacation with a lower salary – or you can hire a mid-level, book 30 or 32 patients per day, take more vacation and earn more too.

The medical students are starting to sniff around. You're looking more like a dermatologist every month.

If any financial lessons are learned from TransforMed, this will be one of them. Of course, we knew it all along. 

However, somewhere on the road between the wild, woolly and entrepreneurial days of family medicine 40 years ago, and the present-day experience of family practice residency, this commonsense knowledge was lost.

Because I left academic family medicine in 1980, I don't know how we lost it. My residency director semi-retired from a busy practice in upstate New York, where he saw 30 to 40 patients per day. I doubt many STFM members have that sort of experience; what they know and teach is important, and good, but it has not translated into financial success from their disciples.

I have two very close friends from my early years in medical school and private practice, both dentists. They got a thorough schooling in the business of dentistry. They both were grateful for their payback time in military service, because it gave them a chance to build up their practice speed (as they put it, how to turn the burr) before taking out big loans to start their businesses.

I'm afraid that young family physicians still don't get much practical help with business, and to make matters worse, they no longer have mentors who assure them that they can turn the burr without sacrificing the joy of personal relationships. So they join multispecialty and/or hospital-owned groups where their pay has little direct relationship to productivity – and it doesn't matter, because their service is only a loss-leader, a pipeline into the procedural roundabout. Worse, the lack of entrepreneurial incentive makes them resent that same-day patient who really needs to be seen today.

That's a shame. I wish I knew a way out of this wilderness, where I seem like a voice crying. The present incarnation of the Medical Home may help to sort out the inherent problems and inefficiencies of large groups, or it may not. The lobbying efforts of the Academy may wring a 10 percent increase in payments from Medicare or big insurers, or they may not.

All I know is that I'm having a good time in solo practice, and have for 23 years. Come on in; the water's fine!

Posted at 09:39AM May 05, 2009 by Doug Iliff  |  Comments[5]