Business Models for Family Physicians
By, David Filhart
Published in the Student Journal of Medicine: November, 2014
*Special thanks to Professor Dr. Timothy Delicath
for mentoring, editing, and suggestions.
Table of Contents
Table of Contents. 2
Secondary Research (Review of Literature). 9
Research methodology and design………………………………………………………………..……………….44
Data collection process…………………………………………………………………………………………………48
This project will closely analyze the different business models that are in play in the specialization of family medicine in the United States. In this work, one will find that clear definitions and differentiations of the business models used in family medicine today are given. With that, a careful look as to the various advantages and disadvantages are given herein. Furthermore, an in-depth look into why there was a need to evolve and innovate from the traditional family medicine business model is looked into. When examining this point there is analysis on the economic factors and other variables that came into play and which business models take care of each problem. Also we examined which business models were the most viable and beneficial to the physician and the patient. Specifically we looked at the happiness of the physician, the patient satisfaction, the annual income of the physician, and also their stress level.
Business Models for Family Physicians – by, David Filhart
As we examine the various business models for family physicians, the reader will come to recognize that they may come in many different varieties. This paper examines why there are so many different business models in family medicine. The reason that we are looking into this is because it seems that all physicians are playing with the same rules, yet they have so many different ways that they are playing within those rules. Could there be a set of practices or an ultimate business model that would be more than satisfactory for all physicians?
We will also examine the different types of business models in detail so that we can try to understand this relatively new phenomenon as even today most of us are familiar and have the idea in our head of what and how a solo family physician would run their practice. As we do this, we will look at the pros and cons of the different business models. As we look into the various advantages and disadvantages of each business model, it is the hope of the author that this will also help to identify, define, and differentiate between the various business models for the reader.
We will also analyze the data that we received from first and second hand research. The firsthand research was conducted through a variety of ways. For instance, there were interviews conducted to the physicians via email, and also over the telephone, and finally face to face with the author. The secondary research was gleaned from various scholarly articles that had been published and that the author of this paper thought was appropriate for this topic. Finally we will synthesize the data that was gathered through the various methods to determine which business model would make the best business model for a family physician depending on a variety of factors such as their ultimate values and goals in practicing medicine and delivering excellent patient care.
Going through all of these stages of research and writing, our hope is that in this paper we will help students, physicians, and anyone else that is interested in the business models of family medicine to understand the different business models that are being used today. As we do so, it is also the authors hope that this may possibly help to open the discussion as to what would be an even better business model in the future, that may not even be in existence today.
As there are many different ways to run a family physician to run a practice, it would be surprising to some to see the different and innovative ways that have evolved over the years. This is due to the many different variables that the family physician is forced to deal with. Having been exposed to many different ways that family physicians have as a business model, the author thought that it would be an interesting task to further research the various business models and to try to gather data that may help one to conclude the best set of practices that a family physician can use to be successful studies.
Conducting the research by both first and secondhand sources has been really eye opening to the author as to the different business models those family physicians and other doctors are practicing. It is the hope of the author is that an attempt to have synthesized the best parts here and that this will be beneficial and interesting to the reader, in such a way that there will be a better understanding not only to the difficulties that the family physician faces today, but also to some possible solutions to help these physicians.
The main objectives of this study are first to define and differentiate the different business models that family physicians are practicing in the United States today. Another objective will be to understand why family physicians are looking at new and innovative ways to practice medicine as it relates to the business aspect. Identifying the pros and cons of the various types of business models will also be an objective. The final objective is to help the reader to come to a conclusion of the viability of each business model.
The problem this study will address in particular are various and complex. Because of different economic factors, various government laws and changing mandates Family physicians have been struggling to survive in the free market. Other factors such as quality of patient care and time management have also been affected due to these factors. The family physicians have had to struggle to adapt their business model. In order to stay in business, deliver quality healthcare, and to have a lifestyle by implementing new business practices that are more cutting edge than traditional the family physician in many cases is still struggling to survive in the healthcare industry today in the United States. Finding the best business model for the family physician has been an ongoing process and is still up for debate (Goldberg, 2008).
Purpose of the Study
The purpose of this study is help the struggling family physician, and aspiring family physicians. We will do this as we explore different business models. This will better help us in order to identify a set of best practices. A concomitant benefit will that this will also to help the reader to become better acquainted and familiar with the different business models that family physicians are using in the United States today.
As this is done, hopefully the pros and cons of each respective model will be made clear, and the reader will be able to decide for themselves which business model, or combination thereof would be viable to them best suit their individual needs, wants, and style for their own preference. Also, the reader will be able to see the why as to there being different business models for the family physician, any why they are continuing to evolve from traditional business models conventionally used in family practice.
Finally, it is the author’s with that hopefully this paper may in some way help the reader to become inspired and to think of an even better business model for the family physician than what is presented herein, or what is currently being used today.
When conducting the research, it was important to ask what the business model was exactly. Also important was the why this business model would be necessary, and its viability in the real world. What are the pros and cons of the various business models? To go along with what was just said, what was it that the physicians in family medicine wanted to make them want to change the way that they practiced medicine? Also, which practice was more beneficial, or what benefits did the patient see from the various business models? Finally, what impact will each business model have on the lifestyle of the physicians? When we attempt to answer these questions we will be able to solve the problem that family physicians are having today in their business practice as answering these questions will help us to identify the best and ideal set of practices that physicians can use, or are using today in their innovative business models.
Significance of the Study
For various reasons, family physicians have evolved and morphed the traditional and conventional business model into various forms (Goldberg, 2008). This study will be significant insofar as it will help the reader to understand the different business models that the family physicians in the United States are practicing, and to further understand the pros and cons of each business model.
In this section we will examine the various types of business models used by family physicians in the United States today. We will also look at the advantages and disadvantages that each business model may present. The way the research was organized was to give a brief overview of the business model. After this we will examine why, and how this business model came about. Next we will analyze the pros and the cons of the business model, as well as any other pertinent information that is useful to the reader.
Within each topic will be cited firsthand and secondhand research from personal surveys and researched literature respectively. The different business models that will be examined are concierge medicine, the micro practice, the solo practice, the solo-solo practice, HMO’s, PPO’s, group practices, a traditional practice, health care homes, and cash only practices, amongst any other variations.
Debra Goldberg put it well in her dissertation when she said that basically the external environment that many family medical practices face is so extremely complex. Some of the variables that the family physician or practice has to deal with on a regular basis are the pressures and constant changes that come from regulatory sources. Also an added pressure is the fact that reimbursement levels are decreasing instead of rising. Another factor that is cumbersome for the family physician is having to deal with the changing of technology which seems to happen at a very rapid rate. Finally, there is also a huge increase in patient and community expectations from their physician (Goldberg, 2008).
To begin with, concierge medicine is gaining popularity in the field of family practice. Concierge medicine isn’t an entirely new idea in medicine however. Although, the actual business model today is a bit different than it was fifty years ago (Hover, 2008). It was interesting when talking to different physicians that are not in a concierge practice, that they would like to be in one and have thought about making the transition into a concierge practice. Needless to say, today’s definition of concierge medicine is different than the definition from yesteryear (Signature, 2013).
It is important to note, that in concierge medicine that there is a focus on preventative care. This means that there is less hospitalization of the patients. What is also great is that instead of a patient panel of say 3,000, most concierge physicians cap their practice at around 600 patients. This definitely helps for better patient care. This also helps to ease the stress of the physician. This will not however help with the shortage of family practice physicians in the United States (Signature, 2013).
Concierge medicine is kind of like paying a physician a retainer fee in the legal world. The fee that you pay can be a yearly amount that is spread over twelve months or in a lump sum, or whatever time table of payment is decided upon (Marshall, 2011). Originally concierge medicine was geared towards those with stratospheric incomes, now however, retainer fees at some practices have gone down and this has led to others with lower incomes to take advantage of and experience concierge service in medicine.
Concierge medicine is great for the patient if they really like the doctor, and they do not want to be inconvenienced by waiting more than a day for an appointment to see their physician. The patient also is usually guaranteed more time in this type of business model with the physician. This is especially appealing to patient who would like thirty minutes to an hour with their physician (Markiewicz, 2014).
Some of the reasons why concierge medicine became a popular niche in medicine are because a lot of physicians felt like they were seeing a huge number of patients, and not spending a lot of time with them. For example, a physician could be booked with over twenty patients a day. Oftentimes seeing 24 patients in a work day is the goal. Sometimes this can average out to seeing a patient for 7-9 minutes maximum. As one can empathize, it would be very advantageous to have such a schedule where you can see about a quarter or a third of the patients, and also be able to spend thirty minutes to an hour with them. Not only would this be great for the patient, but it would be great for the physician, and this would equate to a mutually beneficial relationship and ultimately equate to phenomenal patient health care.
On the patient’s perspective, they often felt like they were paying too much for their healthcare and not getting enough time with the physician, and or the physician seemed rushed. Another reason is because some people elected to pay for concierge medicine instead of having to deal with the hassle and cost of insurance, and concierge medicine allowed the patient a way to save money. The patient would be able to save money with concierge medicine if they were to be able to pay less to the physician for their subscriber fee than to their insurance company premium.
There are many different variations of the concierge business model. One thing that they all have in common is the fact that the patient has to pay a subscriber fee to the physician. Usually the fee will ensure that the patient has 24/7 access to a physician. It usually also means that when a patient and a physician are in a concierge agreement, that the physician will have allotted at least an hour per patient visit. In many instances the physician may actually then charge more to the patient if the allotted one hour visit with the physician is over for the month and then the physician may charge a fee by the minute for every minute that goes over the hour.
As stated earlier, the way a concierge practice is set up allows for the physician to accept an annual fee from the patient, for example. This fee will cover whatever the physician and patient decide. It could just be a fee for the patient to be accepted into the practice. The fee might also cover the actual visit. Sometimes the fee may even cover medications. This is entirely up to the physician, and the patient. The great thing about the retainer fee, for the physician and the patient, is that this allows the physician the luxury of seeing the patient for a longer visit instead of the rushed ten minute visit.
Most patients that can afford to pay for concierge medicine, also do keep their insurance for other reasons such as surgeries, or if they have to see a specialist. Depending on the insurance the patient has, the medications may also be covered by the insurance, and even reimburse the physician on top of the subscriber fee that the patient pays to be a part of the concierge practice. The concierge fee or subscriber fee is never covered by the insurance company however.
This translates into the physician only needing to see so many patients a day to make ends meet, which would be a fraction of what they were seeing, because they have the retainer fee coming in regularly. For example, usually a healthy practice has around 2500 patients. In concierge medicine, often the practice caps off the patient load at only 600 patients.
On a daily basis, a physician practicing concierge medicine may see 6 to 10 patients a day. They also spend as much as thirty minutes to a half of an hour with each patient. Elderly patients especially appreciate this as they are often managing multiple issues or problems with their health. Oftentimes the patient, especially the elderly patient, has a caretaker that comes along with them to appointments.
The bringing of an additional caretaker can extend the meeting time with the patient as the caretaker is another person with information and who often expresses what the patient needs to, or at least prods the patient into saying what they should say if the patient does not remember or perhaps does not necessarily want to discuss a particular problem due to embarrassment or preference personally. Concierge medicine is great for these types of patients as the doctor is not worried about the time constraints that may come if he or she had to see thirty patients a day. Furthermore the caretaker and the patient do not feel they are imposing on the physician when they go in for a doctor visit.
The pros of a concierge practice are that the physician can see fewer patients in a day, and also see the patient for a longer duration of appointment. This means that the work load will be a lot less, which equals more personal time for the physician to do other activities such as recreation or family time if they choose it. At the very least, this is an option that is very inviting for a lot of physicians (Growth, 2014).
As far as the patient is concerned, the patient gets to get in to see the physician quicker, usually the same day that they call, and for a longer period of time. Also, for the physician, there is a steady stream of income no matter how many patients they see, or do not see. This type of business model also translates to less workload for the office staff. Because there are less patients to manage for the practice, the workload is also lessened for the staff.
Some of the cons to concierge medicine are that the practice needs to have subscribers, and it could take time to get subscribers to this system. Another con is that it may be more difficult for a physician to take time off as the patient will most likely expect service from their physician that they are retaining as opposed to a mid-level health provider such as a physician’s assistant or a nurse practitioner.
Sometimes it can be very difficult for a physician to get subscribers to their plan. This is especially true because most patients are not accustomed to paying a subscriber fee for their healthcare, and perhaps do not want to, especially if they are already paying for big premiums in health insurance (Growth, 2014).
Most patients that are paying for concierge service want to make sure that they see their physician that they are paying for, and no one else. Another con is that the physician may not feel comfortable asking their patients for a subscriber fee. However, it may be surprising to the physician how many patients are willing to pay to be a subscriber to a concierge practice if the quality of care is increased.
Another difficulty a physician may have when transitioning to concierge medicine is which consulting company they would like to work with. There are a variety of concierge consulting companies that will help the physician to make the transition to concierge. Depending on a variety of factors the physician may want to use one concierge consulting company over the other as some have policies that allow for the physician to be more autonomous and more personalization in designing their concierge practice (Growth, 2014).
A solo-solo practice is one where the physician is the only actual person working at the practice. In other words, there is no insurance specialist, and there is not receptionist. That means that the physician is dealing with the insurance company and they are answering their own phone. This also means that there is no medical assistant to take the blood pressure or to handle the urine sample of the patients. The physician answers their own phone, runs the EKG’s, takes care of the billing, etc. This can be a very difficult way to practice for these very reasons. A physician working for a big corporation has an administrative team that takes care of the hiring and firing. They also probably have a department for billing. In corporate medicine the physician does not clean the toilets or take out the garbage, but in a solo-solo practice the person that is cleaning the toilets and taking out the trash is the physician. It is easy to see how one could lower the overhead by a solo-solo practice, but then one has to consider the opportunity cost that comes from having to do things like cleaning the toilets and taking out the trash, while the could be seeing patients and actually making money. In other words, the main way to make money as a physician in family practice is to see patients. This is the physicians core competency. However, if they are busy doing other things like taking out the trash, then they are in essence losing money.
Sometimes certain tasks are outsourced to other entities. For example the billing for a medical practice could be outsourced to another company for a nominal fee. The billing can be very difficult to handle as this can be very time consuming and a tedious task having to deal with insurance companies and the like. In other words the physician is the only person running the practice and performing all of the duties, save it be running the labs which are also usually outsourced, although the physician is still having to draw the blood from the patients if need be.
A physician may choose to have a solo practice because they want control of their whole practice. Another reason why a physician would choose a solo practice is because the overhead will be cut down by a lot if they do not have to pay for other employees, such as the receptionist, billing department, medical assistant, nurse, phlebotomist, etc. The physician may not want to deal with any other staff.
A patient may decide to go to a physician who has a solo practice because they feel that this helps them to have more confidentiality in their health care between their physician and themselves. Also they may choose to see a solo practice physician because it may seem to be more personable to them as a physician running a solo practice has less of a patient load as they can only see so many patients in a day. A patient may also find that it is easier to set up an appointment to see a solo family physician because of the lower patient load.
Usually, the way a solo practice is set up is self-explanatory. They are usually run from the physician’s home. However, some are also run from a small office. With the advent of various technologies it is quite possible for a physician to take on all of the tasks that it takes to run an office. For example, the physician may not have to spend time answering phones and setting appointments as appointments can be set up online and confirmations can be automated by email or telephone.
Some physicians don’t mind answering their own phone, and even go so far as to make their cellular phone number available to the patients Also, tasks like taking blood pressure can also be automated as there are electronic blood pressure cuffs that are very accurate and can be done as the physician is taking the history of the patient. These are just a few of the things that physicians in family medicine are doing today that may seem atypical to the traditional family medical practice.
The pros of a solo practice are that you do not have to deal with any office politics. This is especially nice if you are more introverted and does not care to make small talk with the staff. Another plus about not having staff is that you do not have to spend the time or the resources to have to train them. The physician also does not have to solve problems that can arise from personality conflicts that may arise between co-workers. The physician also does not have to supervise or be a task manager for any other person except for themselves. Also, the overhead is a lot lower due to the lack of staff or employees.
Because you are responsible for doing everything, this may be nice as there will not be any monotony and you will always be busy doing something, from billing, cleaning, replying to emails, and marketing. Another plus is that if the practice fails, there is no one to blame it on except for you.
Some of the cons are that there is no one to substitute for you, for example, if you need to take time off. You are the only employee. Also, you have to do all of the work. This means everything. A lot of the things some physicians would feel are beneath them after all of their hard work in school. Also, all of these other tasks can take away from the big money maker which is seeing patients. Having to do a bunch of other tasks may cut into the time available for actually seeing patients. Another con is that if the practice fails, you only have yourself to blame (also see pros).
Many solo practice models are what is used in small towns because there is less competition from corporations. Also the small town doctor may choose this practice model in a rural setting because the physician is actually the right fit for this type of lifestyle and environment as it takes a certain type of physician personality to make it in a solo practice in a rural area as evidenced by the high turnover of family physicians in rural areas in the United States (Stucke, 2009). In fact, in states like Florida, the family physician solo practice has fallen from sixty-nine percent to just over forty percent (Bryant, 1998).
An entity that is really putting a strain also on the solo practice is that of the managed care practice. That is what health maintenance organizations are. These organizations are forcing solo practice physicians out of business because insurance companies give them contracts with a lot of patients, and the patients are charged less as there is a volume discount to be in the HMO or the PPO. This is in turn making it very difficult for the solo family physician as they are losing patients to the HMO’s and the PPO’s and they do not have the negating power of a large group to deal with the negotiation of the contract that would come if physicians banded together into a group. So this means that the intimate care of patients that has been practiced for centuries in the traditional solo physician family practice is becoming extinct in a lot of ways. This then means that patient care is becoming less intimate and more managed by a team of physicians or a health care team. Some argue that for this reason managed care is better than solo practice care as far as the quality of healthcare that the patient gets is concerned (Bryant, 1998).
On the other hand, one study suggests that the productivity of the physician is much more for a physician in solo practice as opposed to a physician that is working for a managed health care team. This is kind of like saying that competition between the two models is give and take as one has strengths where the other has weaknesses (Bryant, 1998).
A micro practice is very similar to a solo-solo practice, with the main difference that of being a physician who is in a micro practice will often have at least one other staff member, usually a receptionist/medical assistant. This is so the physician will not have to answer their own phones, draw labs, or take vital signs. These are just a few of the unique tasks and practices that you will see a physician in a micro practice perform (Guglielmo, 2006).
A physician in Portland named Dr. Ott said that she did a lot of research before she actually switched to the micro practice from a more traditional practice in the year 2008. Before Dr. Ott did this however, she, ultimately realized that even though her overhead would be low, and the stress level would be low, that she would indeed have more responsibilities that she did not worry about before, like the cleaning of the building, collections, insurance negotiations, and other responsibilities that are usually delegated to other people in a larger practice or group setting (Hands, 2011).
The reason that a physician may want to have a micro-practice is because they want to cut the costs of having a lot of employees, while at the same time keeping someone on that can do a lot of other tasks, thus allowing the physician to focus more on the medical side of the office. Virtually every other aspect of a micro practice is similar to that of a solo-solo practice. Although there is a crisis in family medicine due to the shortage, it has been said that the micro practice will not help to alleviate this in any way because they usually see less patients per practice (Davis, 2008).
To go back to Dr. Ott, it is interesting to note that since the six years that she started her micro practice, and taking on doing everything, that she let herself have a little bit of help. Although she is still considered a micro practice, she allowed for help in the cleaning department, as well as some billing, and an answering service (Hands, 2011).
Physicians that practice medicine in the micro practice model seem to be very happy (Happy, 2011). They really seem to enjoy the interaction with the patients and the flexibility to make their own hours. This is probably due to the less stress they feel with the lower overhead costs. Also contributing to their happiness is the sense of owning their very own practice (Happy, 2011).
Even though on average they get paid less, they are also under less stress, and usually feel that this trade-off is well worth it. In fact, in a recent article, it was found that because of the less overhead, and the stresses that come with a larger staff, and running a larger organization, that this actually equates to more fulfilling practice for the physician as they do not have to worry about the things that are not related to patient care (Jespersen, 2006).
In addition to this the patients also enjoy going to a micro practice. This could very well be because they feel that they are getting quality care for their money. This is because the patient gets to spend more time with the physician. This could also be because the patient is in an environment that seems more warm and friendly, due to the atmosphere (Kerr, 2007).
In a recent article published by the Morning Sentinel, it follows a physician who worked in corporate medicine for a long time. The physician stated that she was secure in her corporate life, but then saw that there was a different way to practice in an article that she had read. This physician decided to start a micro practice. One of the patients that was seeing this new physician stated how she was especially surprised to find that she could get into the practice without a long wait. One of the previous family physicians that she called said that she would have to wait for three to four months for an appointment, whereas the physician that was practicing in the new micro practice accepted the patient that day. This really made the patient satisfied.
What was even more satisfying for the patient however, was that the physician from the micro practice was able to direct the ill patient to the necessary specialists that were needed to get the patient back in good health. The patient felt that, after she got healthy again, that she did not want to bother the micro practice doctor, but to her surprise, the doctor called her to follow up and see how she was doing. This really made the patient happy, and the patient came to the realization that the doctor did want to hear from her (Jespersen, 2006).
Many physicians describe the frustration that they have to spend so much time doing paperwork that they feel is unnecessary. So, this makes sense also because the less paperwork there is to do, the less stress there will be, and furthermore this could mean more time with patients, and it usually does (Lactis, 2008). For all of these reasons it seems that the combination makes it much more of a pleasurable experience for the patient to go to a physician that practices in the micro practice business model in the United States (Painter, 2006).
A more traditional solo practice is where a physician has a full staff, consisting of a medical assistant, who would take the vital signs and bring the patient back. There may also be a receptionist that works the phones and greets the patients. There may also be an insurance and or billing specialist. Also, there may be a person or a department for marketing. Finally, there may be an office manager who helps to make sure all of the pieces are running smoothly and that can supervise all of the office workers. There can be of course many variations of the way an office is set up, however this is the most conventional way (Practice, 2011).
The office manager in a traditional solo practice helps they physician to be able to take care the patient care and also to let the physician know of any problems or concerns that may arise in the day to day business of the practice. An office manager can also serve as a liaison between the staff and the physician. All of these tasks may also be combined, shared, or overlapped with other responsibilities and duties that are necessary to run a smooth office.
In addition to the office staff, a physician may elect to have a number of mid-level providers such as nurse practitioners and or physician’s assistants. The mid-level health providers can be an excellent source of revenue as they can see patients on behalf of the physician. This can increase the amount of patients that a practice sees in a day. This can also add quite a bit to the revenue stream of the practice as well as the profitability of the said practice (Journal, 2004).
A physician may elect to be in a solo practice because they like things done their way (Beaulieu-Volk, 2014). They also enjoy having the appendages of an office staff and or mid-level health providers to keep the practice running smoothly. The traditional solo physician has their independence, as well as a team to help the practice.
Some of the pros of having a traditional solo practice are that of enjoying the camaraderie of the office staff. This can be like a team with the purpose of the team being to provide excellent patient care (Bryant, 1998). This can in turn have a synergistic effect and increase the positive energy of the office. Another pro is that the physician can delegate certain responsibilities and duties to the staff as they may deem necessary.
Additionally, depending on the state laws, the physician with mid-level health providers may be able to be out of the office while the nurse practitioner or the physician’s assistant is seeing patients. This would allow for the physician to be more flexible in taking time off for whatever reason they may have. However in some states the physician does need to be in close proximity to the practice, even in the building, when managing mid-level health providers.
Another important pro in being a traditional solo practice is that the physician is independent. They are independent from the policies and rules that are outlined by administration. They also do not have to deal with being treated with disrespect from the any administration and do not have to worry about getting written up or being evaluated every few months. The physician also does not have to worry about getting their pay docked if they do not see a certain number of patients. This type of practice can be a huge reduction of stress if the physician is not up to dealing with administration looking over their shoulder (W______, personal communication, October 5, 2014).
In a traditional solo practice the physician is the one who gets to call the shots on how they want the practice to be run. They have no other supervisor. They have no other partner or partners that they have to deal with, or to consult. When there is a decision to be made, or a change needs to be made, the physician can decide what they feel is best and executes their vision. The physician is ultimately the head boss, unless the physician has a wife, then she is the head boss.
Even though many of these advantages are great, the disadvantages of a solo practice can also be great. For example, there is a family medicine doctor that is said to not even be able to give away his practice (Gardiner, 2011). This is a huge disadvantage, especially if the physician was banking on the sale of the practice for money to place towards retirement.
Due to the ever competitive medical field, with corporate medicine being the stiffest competition, it is very difficult for a solo practice to survive (Girion, 2008). With that being said however, with the advent of new technology and the costs coming down from such, many physicians in solo practice are taking advantage of this. The technology that is available today is actually giving a lot of family physicians a chance whereas if they did not have this they could be in even more trouble economically than they are now (Naik, 2007).
In a recent article that was referred to earlier, we learn of a family practice physician that could not even give his practice away (Gardliner, 2011). We learn that this family physician is in a predicament that many solo practice family physicians are in. The article argues that quite possibly this type of medical business model will soon become extinct due to the mandates that are forcing this way of practicing medicine very difficult and some may say obsolete.
The article follows Dr. Sroka, who himself employs the equivalent of five full time employees. In order for Dr. Sroka to make a profit, he needs to see four patients an hour. If Dr. Sroka only sees three patients an hour he will just barely break even. The Doctor works long hours. Many of his patients he has had for over thirty years. One year he made over three hundred thousand dollars, and this year he will be lucky if he makes over one hundred thousand dollars. The reason why he can’t give away his practice which boasts about four thousand patients is because he is working so hard for so little money (Gardiner, 2011).
Most new physicians that may be looking to buy a practice are burdened with a lot of debt and also want a lifestyle. In the article it states that over half of the family physicians coming out of residency are women. These female physicians as it is stated in the article that they preferred or wanted the weekends off, the ability to go to their kids soccer games, and want to go shopping and enjoy life while paying off their student debts. This dream is virtually impossible if they were to buy Dr. Sroka’s practice (Gardiner, 2011).
Dr. Sroka’s son says that he feels that his dad is just going to lose it one of these days as there are new mandates that come out all of the time that he just can’t keep up with. One example of this is the electronic medical record which Dr. Sroka may not even be able to afford, or let alone have the desire to learn how to use so late in his career (Gardiner, 2011).
Although the official definition from Medicare and Medicaid for a group practice is 25 or more physicians together, for the purposes of this paper, and what is known and what actually makes sense and is used in the real business world, we will not be using that definition here (Lee, 2013).
A group practice is a medical practice where there is more than one physician in the practice. This can range from two physicians to very large groups of over eighty physicians. They are also fully staffed in the office and may utilize mid-level health care providers to help bring in more revenue and profitability to the practice.
A physician may choose to be in a group practice because of the various advantages. One major advantage is being able to rotate being on-call. This is very hard if the physician is solo, and a solo physician may feel tied to the practice. Physicians in a group practice can also cover for each other when they are going on vacation or emergencies.
The phrase power in numbers definitely rings true here in the group practice. This is because the group of physicians will have increased bargaining power when working with and negotiating contracts with the insurance companies. There is also usually more structure as far as vacations and people that are willing and able to cover for you when you are on vacation.
Being in a group practice can come in various forms. Usually, there are a set of standards or guidelines that must be adhered to in order to be a part of the group. For example, some of the mandated polices could reflect the hours of operation, or standard procedures. Group practices come in all different shapes and sizes. The autonomy of the physician can also vary by degrees depending on the group. Some group practices will recruit physicians and they will staff the office and even the building to the physician.
This is because often times, resources are pooled to help the physicians in their practice. For example, a certain percentage of the budget may go to advertising and marketing for the physicians in the group. This would obviously benefit all of the physicians that practice under the group’s banner. Also, when physicians are part of a group, they often refer patients to other physicians in the group. This is also mutually beneficial between the physicians in the group as this helps to keep patients coming through the doors.
Some disadvantages of being in a group are the loss of some control over the way that you would want the practice set up. For example, the physician may not be in charge of hiring staff, and may be stuck with whoever is assigned to the office. This may prove to be difficult as certain personalities can clash. Also, the person that is hired for the job may not be performing as well as a physician would want, but not bad enough to get fired, and there really would not be much the physician could do about it. This is only in some cases, like there are many different variations of the group practice.
Depending on the deal made with the group, there may be certain criteria and quotas that need to be met in order for the physician to be a part of the group. For example the physician may have to see so many patients a day in order to receive a quarterly bonus. This is because oftentimes resources are pooled to help the physicians in their practice, so everyone has to pull their weight. This could add a lot of extra stress to the physician. For example, a certain percentage of the budget may go to advertising and marketing for the physicians in the group. This would obviously benefit all of the physicians that practice under the group’s banner. Also, when physicians are part of a group, they often refer patients to other physicians in the group. This is also mutually beneficial between the physicians in the group as this helps to keep patients coming through the doors.
Another disadvantage would be is having to deal with any negative repercussions that could come if there was a physician or controversial scandal that occurred that would tarnish the brand equity of the group’s name. This is because things that happen under the group name could negatively impact you as a physician as your name would be associated with it. This may be a rare incidence, but it does happen unfortunately. This would be very frustrating if you were an ethical physician, to have your name associated with something that you may have had nothing to do with.
Another situation that may be difficult to deal with in a group would be the hassle of making changes. For example, if there was a certain electronic medical record that the group was using, but that the physician did not like for some reason or the other, the physician may end up being stuck with that software and be irritated by it on a daily basis. This could be frustrating in the form of the Electro cardiogram machine that is used, or to the company that is contracted to run the labs, the insurance companies that the group decides to accept or reject, and to any other policy and procedure that is agreed upon in the group. This may be the case if the group thinks that they could save money by using one type or brand of equipment, and another physician may not be satisfied with its performance. Furthermore, if the equipment were not as good as they thought, and they spent a lot of money on the equipment, then the group would have wasted a lot of money and the frustration and the morale of the physicians and employees would go down, but the physician would almost be stuck as they would be under contract.
Another big disadvantage would be that when a person or a physician signs a contract or becomes a part of a group, there is usually a non-compete clause in the agreement. This means that if as a physician you become fed up with the group, and decide to leave, you may not be able to practice in the same location, within a certain radius of any of the physicians in the group, and you would not be able to have your patients follow you. This could be very difficult for the physician that has roots in the area in which they live, or possibly have children that are integrated into the community, church, or school. Another difficulty would be the consideration of the spouse and what they would want to do.
This would mean that you would have to wait out your no compete clause and or move to another location and start all over. This would be indeed very difficult as it can take a lot of time and effort to build a practice. Because of this the physician may decide to stay with the group even though it is frustrating and difficult, thus making life somewhat miserable when it comes to practicing medicine and working (Editors, 2009). The larger the medical group, the more difficult it may be to get things done as far as change is concerned as this usually means more channels and red tape to deal with.
Medical Home Practice
This is a unique niche in the medical world that has actually been around since the 1960’s (Business, 2011). In this business model, the physician basically runs the medical home, and the medical home is a place where people can go for all of their health care needs from cradle to grave. So a patient could come in to see their family physician, and if they needed to see a specialist, the specialist would be available in the same location. To be clear, there is a team of medical health care providers that are able to communicate with each other, and communicate with the patient. This is a great business model for the patient especially if they want a one stop type of shop for their healthcare. This is really great for the physician as communication between colleagues is much easier as they are in close proximity to one another.
The advantage of this type of practice is that the patient will, in theory, be better taken care of because of the effective channels of communication that are in close proximity. This is good for the patients of a family physician as the health care team will be working close together for the benefit of the patient.
One major disadvantage of the medical home business model is that it has been found to be more expensive to run than most other medical practice models. This would most likely equate to less money being taken home by the family physician. This would also equate to less money for everyone working in the medical home. For this reason it seems that the medical home has been stagnant as far as growth is concerned, especially when comparing it to new and trendier business models for the family physician such as the micro-practice.
Preferred Provider Organization
Otherwise known as a PPO, this type of health organization is good for the patient that does not necessarily want all of their care coordinated through the primary care physician. In other words, if a patient wanted to see a specialist like a dermatologist, the patient could do that if the dermatologist that they went to see was in the preferred provider organization. The patient would not a referral from another physician first in order to get a referral.
For the physician, being a part of this organization may be good as the subscribers would have you as an option should they choose to use your services. For example, if a patient does want to go to a family physician, and you are a member of the PPO, or under contract by them, then the patient would see your name on the list and possibly choose you as a physician (Bayley, 1998).
Another advantage for the family physician that is a part of the Preferred Provider Organization would be that, similar to a group practice, the team infrastructure would be there and because there is usually a large group of physicians that are contracted with the Preferred provider organization, there is bargaining power in this.
Some of the disadvantages would be that what would come with being a part of any large organization, which would be for example, having to deal with administration, personalities, policies, and other nonsense that one may not find in a smaller situation. For example, a physician may have to see so many patients a month to fulfill a quota. Furthermore, the physician may be told how to practice medicine.
To amplify this, let’s take for example, if the physician feels that a certain test is necessary, the preferred provider organization may ultimately say no and request another procedure be in effect first. This would either be to save the preferred provider organization money, or to make the organization money. This ultimately helps the bottom line of the PPO.
If a physician feels that a patient needs a particular treatment, this could be very frustrating for a physician that feels that for the best interest of the patient that something else needs to be accomplished for that patient’s benefit, and yet it is rejected by the PPO. It is incredibly interesting that some articles have stated that PPO’s are actually really popular amongst patients (Hurley, 2004). This could be because the patient enjoys the ability to be able to go to a specialist without having to get a referral from a family physician. The way that PPO’s keep this type of health care costs down is by offering the physician a bonus for keeping the costs of healthcare low and by practicing conservative medicine (Hurley, 2004).
Health Maintenance Organization
Otherwise known as an HMO, it is similar to a preferred care provider in the sense that the family physician will be a part of a network of physicians in this organization (McBride, 1995). One of the main differences between a health maintenance organization and a preferred provider organization is that in the health maintenance organization the patient cannot just see any physician in any specialty that they want without a referral, even if the specialist is in the organization (Bayley, 1998).
In a health maintenance organization, the patient must first go to their primary care provider, which could be the family physician that is listed as a provider in the health maintenance organization. If the primary care physician sees that the patient needs to go to a specialist, the physician will then make a referral to the specialist that is in the health maintenance organization. In other words, all referrals have to go through the primary care physician first, which in a lot of cases would be the family physician.
It is argued by health maintenance organizations that this type of business model actually saves a lot of money for healthcare. Health maintenance organizations argue that a lot of unnecessary procedures and services are avoided by this as much can be handled by the family physician instead of the premiums that are paid for seeing a specialist (Bayley, 1998). This can be especially frustrating to the patient however, especially if a patient really believes that they need to see a specialist and their primary care physician has a different opinion.
All of the rest of the advantages and disadvantages would probably be similar in a health maintenance organization then they are for the preferred provider organization for the physician as far as dealing with administration and policies and procedures. Although there is a certain amount of security that comes with working in a big organization, such as the luxury of working with other physicians and health care providers on a health care team, it definitely comes with a price. One of those prices is physician autonomy.
It seems that physicians that work for health maintenance organizations are the most dissatisfied with their work. In fact, they often fee overworked, and underpaid. It has been said that in one article that they feel powerless and undervalued. This article stated that out of the 24 physicians that were working for the health maintenance organization that they had a huge concern and that was of coping with their frustrations.
An advocate for the physicians stated that it was imperative to make sure that the physicians felt valued and also that a sense of autonomy in practicing medicine was also restored to them in order to ensure their well-being (Healthcare, 2004). This would be very important for the health maintenance organization to do if they wanted to keep their physicians happy and for them to have longevity in their career. One could only empathize how frustrating this could be, especially after having struggled and gone through all of the work it takes to become a physician, to be not happy with your work.
Cash Only Practice
A cash only practice is a business model that is being increasingly popular although it accounts for a small percentage of medical practices today. In a cash only practice, the patient pays the physician directly. In other words, the physician does not receive any money from insurance companies or any other organization (Castens, 2009). The patient either pays with cash, check, or credit card.
A lot of times, when a physician has what is referred to as the cash only practice, they will give the receipt to the patient. This receipt that the patient is given will have the proper billing codes on it. What the patient can do with these billing codes on the receipt is take that and present it to their insurance company if they have one and get reimbursed by them (Chen, 2010). This practice saves the physician and their practice the time and resources that it takes trying to fight with the insurance companies in order to get reimbursed by them.
The advantages of having a cash only practice is that for the physician, they get paid immediately. They also do not have to deal with insurance companies that are notorious for not paying physicians. They may not do this if they feel that a procedure is not necessary. Also, insurance companies have been known to change their policies, so that if a policy is proper one month, it may not be proper the next month, thus causing a headache for the physician and their billing department.
Needless to say, not having to deal with insurance companies in a cash-only business model is a great relief for family physicians. In fact, it has been said that insurance companies are so hard to deal with, and physicians are so frustrated with dealing with insurance companies, that the cash-only business model was born out of that frustration.
It is interesting how out of adversity sometimes the need to overcome them gives us creative solutions, as was the case for cash-only practices. Another positive is that physicians and patients alike are coming to the conclusion that there is actually a mutually beneficial relationship that can be had between a patient and the physician without health insurance companies meddling in their business (Wlazelek, 2008).
Some of the advantages to the patient is that sometimes paying the physician directly for services is cheaper than actually having to pay premiums to their insurance every month. The case may be that paying the physician for services may actually be cheaper than even paying their copay that the patient has to pay on top of their monthly premium (J. Fortes, personal communication, September 15, 2014). This would be a great choice for a patient and a physician as the hassle of dealing with the insurance company is out of the equation. Furthermore, insurance companies often charge or bill way more than a cash-only practice does.
The disadvantages of a cash only practice are that some people do not have the cash to pay for services, such as Medicaid patients. This could dramatically decrease the number of potential patients that a physician may have available to them. This can definitely be a reason why some cash-only practices fail (Frank, 2008).
One interesting aspect of the cash-only practice model is that this can actually help the uninsured. Some practices make it very difficult to see patients with no insurance. However, the practices that are not dependent on insurance, and can lower their prices, are actually places where those that are uninsured may afford to go. For example, a group of Texas physicians designed a cash only practice to specifically go after the uninsured patient demographic (Shinkman, 2014).
This business model of the cash-only practice really helped the people as they could not afford health insurance, or because the people felt that the insurance company was ripping them off. When the word got out that there were physicians that were seeing patients without insurance for a reasonable price the people without insurance were glad to go to the cash-only medical practice that were affordable with a great quality of care (Shinkman, 2014).
One interesting example of the cash-only model is by a practice called Medical Associates of Lehigh Valley. This group of physicians served approximately 100,000 patients. The group became increasingly frustrated with dealing with the different insurance agencies as they would each have a different set of guidelines for the physicians to follow. To add to this frustration, the guidelines are constantly changing. So, for example, if a medication is covered by the insurance company to treat a diabetic patient one month, well, three months later on a follow up visit the same medication may not be covered so the patient has to switch prescriptions. The insurance companies will do this without notifying the physician (Wlazelek, 2008).
This practice by the insurance companies would be especially frustrating if the physician and the patient know that the medication that was approved actually worked well for the patient, and now do to insurance constraints has to switch. Medical Associates of Lehigh Valley figures that they can reduce the hassle of dealing with the health insurance companies by charging the patient and letting the patient seek reimbursement from their insurance company for either all or part of the fee. This will cut costs as the Medical Associates of Lehigh Valley will not have to worry about a billing department, and will also not have to spend hours on the phone with the insurance companies arguing for reimbursement for proper patient care (Wlazelek, 2008).
Research Methodology and Design
As the author contemplated and pondered what would be the best method for gathering primary research and information, it was concluded that a set of direct and open ended questions would be the best way to find out from the actual physicians themselves about their business model that they are using in their family medicine practice. These questions were reviewed and validated by the author’s peers before they were used in the primary research. As the information from the interviews were recorded, it was then analyzed mathematically to come to conclusions of the effectivity of the business model when compared to the variables of income, lifestyle, stress level, happiness, and patient satisfaction.
A huge bulk of the information that was gleaned for this project was found from the literature review. Fortunately there has been a lot of information in the form of various publications that document the different business models that physicians, specifically those in the field of family medicine, are currently implementing in the United States today. Some of the aspects that this literature review revealed as far as the various family medicine business models are concerned were the reasons why there were possibly so many different business models for the family physician, as well as the differentiation between the different business models.
There was also gleaned from this secondary research the advantages and disadvantages of the various business models as they apply both to the physician and the patient. Also, there was insight as to the strengths and weaknesses of the various business models and which business models would be most viable in the future for the family physician.
Furthermore, there was also, when appropriate, an in depth look to various stories or anecdotes that the author felt better grasped the big picture and or illustrated various points as to the general feeling of the physician, practice, and the patients. This would come in the form of stories that were related to the author of the various publications that the author felt was appropriate to share as they were related to the various business models that the family physicians are using and evolving today in the United States.
There was also primary research conducted by the author in the form of face to face interviews, as well as interviews that were conducted via email. The interviews were conducted from physicians that are practicing various business models all over the United States in order to try to get a general flavor and generalizations or common threads that these various business models may have to make them better classified and defined when attempting to differentiate between them. While conducting the email correspondence, the author made sure that a good number of the questions were open ended to allow for the respondents to open up and put their own expression into the interview.
The author conducted a variety of interviews that were face to face. These face to face interviews were with Dr. E___ , a group practice family physician. Dr. W_______, a physician that is practicing in the corporate medical system, Dr. J_______, who runs a cash-only practice, and Dr. B______, who operates a micro practice.
As stated earlier, these questions were reviewed and validated by the author’s peers before they were used in the primary research. As the information from the interviews was recorded, it was then analyzed mathematically to come to conclusions of the effectivity of the business model when compared to the variables of income, lifestyle, stress level, happiness, and patient satisfaction.
The author actually also interned with each of those physicians and was able to also see firsthand how the practices are operated on a daily basis. During this time the author was also able to get a general feeling of the office staff, practice, and patients. The author was also able to see firsthand the interaction that the physicians had with their patients. When appropriate, the author was also able to see the physicians interact with staff and administration, insurance companies, and other aspects of running a medical practice.
There were also a couple of telephone interviews, as well as a number of interviews that were conducted via an email questionnaire. The author found various physicians across the United States to send these interviews to by finding their practices on the internet and their email addresses in the contact section of their websites.
The interviewees were at the very minimum asked a variety of questions (see Appendix A) that were related to finding out more about their particular business model.
Limitations and Assumptions of the Interview Questions and also in the Recording of the Data
Although the primary research yielded valuable data, it is important to realize that due to time constraints and the relatively small sample size that the data may be limited. The author attempted around 60 interviews, with less than half responding, and about half of those that did respond, responded with an answer of not being interested in being interviewed.
It is important to note that another flaw in the data could be that the people being interviewed may have skewed their responses due to the Hawthorne Effect, meaning that because they were being interviewed for an academic project that they could have exaggerated some of their responses in order to make their business model or situations look better or worse than it really was.
However, regardless of the Hawthorne Effect or any other bias, it is assumed that the interviewees were honest and their data and answers that were provided are presented as such. The Hawthorne Effect was a concern as some of the data and answers could have been exaggerated. It would have been ideal to have some of the information come from other sources such as staff, or accountants, to get a more accurate and unbiased answer.
It is also assumed that the author would not skew the information due to an observer expectancy bias, as the author has hopes and dreams of one day running their own family medicine practice with a particular business model in mind. The observer expectancy bias indicates that the person that is conducting the research can unknowingly or knowingly skew the data and results to the expected or desired conclusions that the person has desired in their head.
Data Collection Process – Findings from primary research
The primary data that was collected through face-to-face interviews, telephone interviews, and interviews via email, all provided different perspectives and points of view that were unique to the physician and to their practice business model. The face-to-face interviews were with physicians that the author actually interned with and spent time working in their practice. The phone interviews and the interviews via email were randomly conducted with any family physician that would respond to the request for interview submitted by the author.
It was interesting to find that although each physician considered themselves as a part of a certain business model, that the author found that within each business model there were variations and differences between each physician’s style of implementation of that business model. In addition to the style of the practice, other factors that would contribute to a physician’s variations between certain business models of the same niche was the stage in which the physician is in their career. This meaning that the physician could be at the end of their career, nearing retirement, or just beginning their practice, or anywhere in between those stages. For example, a physician that considered himself in a micro-practice but was almost into retirement and considered himself at the end of his career. The difference between this physician and a physician just transitioning into a micro practice would be that the physician nearing retirement was making more money and working more. Also, it was interesting to see the older physician took on more duties such as maintenance.
Generally speaking, the happiest physicians the author interviewed were those that were working for themselves in some sort of solo capacity, and the physicians that worked for a group or corporate medicine were the least happy. It also seemed that the physicians that worked for a group or for a corporation did however make more money annually on average. What was also interesting is that the physicians that worked for a corporation or a group were very vocal when in saying that they often considered going into concierge medicine, or a cash-only practice, or a micro practice.
The happiest physician that I encountered was a physician that had a micro practice that was cash-only. This physician also had multiple mid-level health care providers working for her. She was happy because she did not have to deal with insurance companies. She also was well paid and appreciated by her patients. She had a huge inflow of patients, but a lot of them were seen by her mid-level health care providers. She had a low overhead. Before she started her cash-only micro practice she had twenty years of experience working for corporate medicine. She said that as she was older that she wanted to work smarter, not harder. She was able to take all of the time off that she wanted and still made a great living as her mid-level health providers saw a lot of the patients (J_____, personal communication, October 01, 2014).
On the other end of the spectrum, the most miserable appearing physician was working for a big corporation. He was making a lot of money, and had some great incentives if he made certain goals. However, he was always stressed out, and worked long hours in order to meet his goal. He also had problems with staff that seemed to be out of his control as he was not the one to be able to hire or fire employees. He also mentioned to me personally that he really did not appreciate having to be evaluated by the administration, and he did not like getting written up when a patient complained. He usually put in around sixty hours a week at work, but then volunteered at a free clinic a couple of nights a week also. The author has chosen to withhold this physician’s name (Name withheld, personal communication, October 01, 2014).
Comparing the Primary Data to the Literature Review
When we compare the primary data collected to the literature review, we see that they do in fact closely correlate one with another. For example, the physicians that were read about in the literature review, we can see that the happier ones are the ones that are doing their own practice, and the physicians that are the most stressed out seem to be the physicians that are working in corporate medicine. This seems to be the truth in family practice.
Another correlation that was found was that the physicians that made the most money annually were not necessarily the most happiest. This was found in the literature to be true as well as from primary research. However, it is also important to note that some of the physicians that made a lot of money comparatively to their colleagues could also be very happy.
It also seemed that a downside to practicing medicine in the United States today, especially as it applied to the family medicine specialty, was that all of the different rules and regulations seemed to be “superfluous” to practicing medicine as the rules and regulations do not really progress the practice of medicine or the quality of patient care (John Mochata, personal communication, October 02, 2014). This seems to be the downsides as all physicians seem to agree on this common belief, no matter what their business model of practicing medicine is.
One difference that the author did note in the literature review that the author did not come across in primary research was the failures in certain business models that could happen. For example there was in the literature review a cash only practice that failed (Frank, 2008). This would be understandable as it is difficult to interview physicians in a failed business practice as they are currently working somewhere else and do not necessarily care to advertise that they were in a practice that did in fact fail.
The way the data was analyzed was by taking the recorded answers from the physicians that responded, then mathematically figuring out the average of the individual responses were, within the business model that the physician claimed was implemented in their family medical practice. When we analyzed the data, we could see that out of the physicians that responded to being interviewed, and also partially in combination with the data found in the literature review, we could illustrate the following graphs from the results: As we can see the family physician on average makes between $150-220 thousand a year for full time hours. We can also see the stress level for the physicians that are working in a corporate setting are amongst those with the highest stress level. We can also see that physicians in corporate medicine are also amongst the highest paid. Interestingly enough, as far as their personal happiness is concerned, the corporate family physician is the least happy.
We can also see that the happiest physicians seem to be those in solo-solo practices, micro practices, or cash only practices. We can also see the stress levels are lower in these areas of particular business models. It is interesting to note that these physicians on average do not necessarily make the most money compared to their colleagues. However there were some outliers that made an annual salary that could be comparable to the highest paid corporate physician.
According to the data and research, the author believes that this implies that physicians that do not work for corporate medicine, or that do not have to deal with insurance companies, are the happiest. This is because the physician has a primary focus of delivering the best possible patient care that he or she has the ability to deliver. This is a very difficult thing to do in and of itself, let alone having to deal with the distractors that a physician would have to deal with just in order to pay his staff, and any other overhead that a physicians practice may have, just to stay in business. This seems to be correlated with the fact that they have on top of all of this, an increase in stress in their jobs is also due to administrative watch-dogs and the like. It can be very frustrating for a physician that is working as hard as they can to deliver quality care to their patients, only to have administration say that they are not seeing enough patients per hour, or that they need to see more patients in a day in order to get a pay raise. It is also very frustrating for a physician to get evaluated by administration, especially as the evaluation can influence their income. It is also an added stress to a physician when they have to deal with getting written up by administration when a patient complains. All of these things combined can dramatically raise a stress level of a physician.
It also seems that the more government makes mandates and rules that this adds to the stress of medicine. Additionally these extra rules and mandates do not necessarily improve the quality of care. The author recalls working with a physician that was well respected by patients, as well as colleagues. This physician had been practicing medicine for over forty years, and was very successful and skilled as a physician. Then the government mandate that physicians were supposed to start using electronic medical records in order to get an increase in reimbursements from Medicare and Medicaid. This physician, even though he was very competent, and his hand taking notes on paper worked just fine over the last forty years, found that he was increasingly frustrated having to learn how to use the computerized electronic medical record. This also was frustrating for the physician as this took a huge amount of time, more than ten times that of taking notes by hand.
We can also see that the amount of money that a physician makes does not seem to correlate necessarily with the level of happiness that they have in their lives. Although, it is also important to note that physicians that made a lot of money compared to their colleagues were not necessarily depressed or saddened either.
The author also believes that this implies that the happier the physician, the happier the patient. If the physician is happy then the patient can benefit from this. The patient will benefit by the way the service that they get in their healthcare from their physician. Therefore it is very important for the physician to work in an environment where they are happy in order to deliver the best possible patient care in the family medicine specialization.
It is the recommendation of the author, that after much research and consideration, that the ultimate business model for the family physician now and in the future would be that of a cash-only micro practice. The reason that the author recommends this is because these business models tend to be the ones with the least amount of stress, thereby increasing the happiness level of the physician and the patient. One of the reasons for a happier patient is because they are receiving better patient care, and one of the reasons that the patient feels this way is because in these particular business models the patient can see the physician for thirty minutes to an hour sometimes, and they do not feel rushed with the visit from the physician.
The combination of the cash-only micro practice business model is also very lucrative as a business model. This is most likely because the overhead costs are cut dramatically in the business models of this type. This in turn increases the percentage of net earnings.
The ultimate family medicine business model practice should also hire as many mid-level providers as the state law will allow. This will allow the physician to increase their income as well as see as many patients as they desire, and not have to worry if the block their schedule out for other responsibilities. In this business model however, it is important to note that in some cases the physician feels more like an office manager as they have to manage the mid-level health providers, such as the nurse practitioner and the physician’s assistant.
The author would also ultimately and strongly recommend that for the physician to try to keep costs down, and to keep the stress level as low as possible when practicing medicine. Remember that patient care is the primary focus. When this is done, the physician can appropriately align their business design and personal goals in the best way. If the physician does this, their business model will most likely be a successful one.
It seems that there are many different business models to choose from, and there are so many factors to consider. Keeping it simple however is going to be the best way for a physician to maximize their happiness and well-being. This will also translate to patients being satisfied with their physician as they receive excellent care.
There should not be unnecessary time restrictions when a patient visits their physician. In corporate medicine a physician is lucky to spend seven actual minutes with the patient face to face. This can be really frustrating for the patient as they may feel rushed. This is also frustrating for the physician as they do not like to feel like they are rushed either. The patient may feel like they are burdening the physician if they take any more of their time, and this can be very dangerous. This can lead to the patient being unwilling to give a full and proper history to the patient, thereby possibly jeopardizing the patients’ health, and this is the last thing that should be done in healthcare, as patient care should always be the primary focus.
There should not be excess mandates and government to take away from the practice of medicine. It is widely felt that these mandates do not enhance or improve the practice of medicine. Therefore, they do not increase the quality of patient care. This is just a problem that adds to the stress, time, and ultimately monetary resources of the family physician.
There should not be administration always looking over the doctor’s shoulder to make sure that profits are maximized. This type of business model adds a lot of stress to the physician. It can also be humiliating to them. This in turn becomes a distraction to the primary goal of healthcare, which is patient care.
When a physician decides on what business model is for them, they need to take a close look at themselves, their values, why they are in medicine, and their goals. When these factors are taken into consideration, the physician will better be able to excise the unnecessary variables that are taking away from the practice of good medicine. Also they will be able to implement the best set of business practices, which will allow them to be able to maximize and deliver the best possible patient care, which should be the goal of health care.
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Interview Questions – Business Models for Family Medicine
- How many years have you been in family medicine?
- What type of business model is your practice, or that you work in (you can choose more than one answer here)?
- How many hours per week is your average work week?
- What is the average number of patients that you see in a day?
- What is the average amount of time that you spend per patient visit?
- What is your daily stress level on a scale of “1-10″ (with “10″ being the most stressful)?
- What is your average annual gross income (the average of the last two years)?
- What are the pros of your business model?
- What are the cons of your business model?
- On a scale of “1 – 10″, what would you say is you level of happiness (with “10″ being the happiest)?
- What recommendations and or advice do you have?