Medical Billing Blog

Medical Consulting: Can My Private Practice Survive the Current Health-Care Climate?

  

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Can My Private Practice Survive the Current Health-Care Climate?

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(If it were this easy, we would not be having this discussion)

For those of us in health-care delivery, sustainability is the ability to endure.  The ability to remain viable by employing strategies to increase the quality of care, maximize compensation while reducing costs.

While other industries have been driven to prove “value” for many years; the health-care industry has largely been exempt from this task.  Today’s environment is forcing practices to re-define their strategies based on a customer driven market.  What do patients want/need, when do they want/need it, and will they return for our services must be a well thought-out plan and implemented consistently.

“If you want to

truly understand

something, try

to change it.” Kurt Lewin

The “unknowns” surrounding the current health-care environment are pushing more and more practices to ask the question “Is my practice model sustainable in today’s health-care market?”

Physician and hospital integration is here to stay and if we simply look around, more and more practices are aligning themselves with hospitals to maintain their revenue stream in the years ahead.  There are “risks” and “rewards” to this approach and both internal and external factors influence the decisions.

Practices and groups that take the “ostrich” approach to this question will soon find themselves too late at the table for the “full meal”.  By ignoring the current health-care environment, taking a wait and see approach or believing that health-care reform will be repealed literally sets up your practice for failure.

There are multiple factors driving integration with hospitals; decreasing reimbursement, increased administrative complexity, increased costs, life-style objectives and a disinterest in entrepreneurial endeavors to name a few.

On the other side of the equation “loss of control” is the biggest perceived risk to integrating with a hospital.

Every practice (large or small, regardless of specialty) should go through the detailed exercise of answering this question and developing a strategic plan in answer to the question.

So….where/how do I as a practice owner/administrator begin this process?

Four essentials must be considered as you go through the process of evaluating your practice:

• How much control you have of market share?  Does your practice have a retail strategy and readiness to enter that market? Are you a “specialist of choice” practicing at a “hospital of choice”?
• Does your practice consistently demonstrate and deliver both service and clinical quality care?
•  Adequate access to capital… Do you have the revenue capacity for superior human resources, technology and facilities
• Productivity of physicians in practice.  Do your patients have timely access to your services? Is your practice efficient and effective?

These essentials are critical to keeping your practice viable.  But before we look at the details of those essentials, let’s look at the details of your practice to arrive at a logical conclusion to the question of the sustainability of your practice. A detailed assessment of your practice whether performed internally or externally is necessary to answer the sustainability question.

For the next several articles, we will look in detail at 4 areas to be considered in this evaluation process: 

(1) Owner demographics

(2) Practice performance

(3) Strategic capabilities

(4) Leadership

 Tomorrow we will look at this process in more detail.