Making the Case
for Retention
Physician turnover hurts morale and costs
hospitals and practice groups millions in lost revenues and
recruiting and training expenses. Why your practice can’t
afford not to be involved in physician retention.
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Does your practice carefully track its
bottom line? Does your administrator review telephone plans
every year to see which one would save you the most money? How
about medical supplies? Office furniture?
The fact is that those
expenses are chump change when it comes to stemming the revenue
flow from medical practices. Every time a physician leaves your
practice, you might as well withdraw $250,000 from your bank
account and burn it, according to Press Ganey, a South Bend,
Indiana-based health-care consulting company. And that figure
does not include a broad swath of ancillary costs. A 1992 study
in the MGMA Journal estimated lost revenues per physician who
left a practice at $400,000 to $1 million for a hospital and
$250,000 to $2 million for a group.
Physician turnover is one
of the most critically important issues now facing American
medical care. The American College of Physician Executives
(ACPE) reported that in a 2006 survey of 1,250 physicians that
nearly 60 percent had considered leaving their medical
practice. Of the approximately 598,000 physician jobs in the
United States, some 20 percent experienced turnover in 2004,
according to Press Ganey, reflecting an immediate and growing
problem that practice administrators must vigilantly address.
Nearly half of all respondents to an American Medical Group
Association/Cejka Search survey in 2005 reported being highly
concerned about physician turnover and more than a third ranked
it as one of the top three critical issues they face.
Reasons for Leaving
While the reasons physicians give for
leaving a practice range from job dissatisfaction to
retirement, most experts agree that there is a growing problem
with physician turnover, especially in locations already
experiencing physician shortages and in specific specialties,
such as cardiology, dermatology, and radiology.
“Part of the problem
is a societal issue, one that happened in a lot of other
industries earlier,” says Kriss Barlow, a senior
consultant for Corporate Health Group, a national health-care
consulting company headquartered in East Greenwich, Rhode
Island. “It’s just now affecting physicians.”
In previous generations, physicians would stay in one practice
forever, just as attorneys and corporate executives.
“Today I think there’s an expectation for more
immediate gratification and that if things don’t work
out, I’ll move along,” says Barlow. “And with
the multiplicity of job offers and physicians not having to buy
into a practice, there’s much more fluidity and
opportunity to move on.”
Money, of course, is
another compelling reason for physician dissatisfaction,
especially with the enormous loan burdens for younger
physicians and the leveling off of compensation many
specialties have experienced since 2002, according to MGMA
salary figures. Still, money is rarely at the top of the list
of reasons physicians leave a practice.
“People often assume
that reimbursement might sit at the top of that list,”
says Pamela
McKemie, the senior vice-president of
LocumTenens.com, which sponsored a survey in 2006 of more than
2,500 physicians on the issue of retention. “Although
money matters, our survey indicated that what is more important
for them are issues around loss of autonomy, patient overload,
and respect. Very strong behind those issues were work and
lifestyle balance. They feel like they don’t have enough
time to live a life outside medicine.”
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Marc Greenwald, MD, the
former chief medical officer at the Fallon Clinic in
Massachusetts, agrees. Greenwald was in charge of physician
recruitment and retention for the 240-physician practice.
“The generation of physicians born after about 1964 wants
a life. They want time for themselves and their families. They
see themselves as time-limited, not necessarily work-limited.
We can expect, on the whole, less work out of those physicians
than ones 20 or 25 years older. That means more physicians to
accomplish the same amount of work.”
This societal change has
been accelerated by the increasing numbers of women physicians.
“They have families today,” Greenwald says.
“Child rearing is very different than it used to be. Many
of these women are in two-income families now and they want
part-time work or they want regular, time-limited
work.”
Add to these reasons the
fact that the supply of physicians is limited in many
specialties—in the past 25 years America’s
population has grown by 30 percent but the supply of new
physicians has been flat at approximately 16,000 per
year—and you have a double-whammy recruiting problem,
with increased pressures on the remaining physicians to handle
their departing colleague’s additional workload. That, in
itself, leads to greater job dissatisfaction and turnover.
Cost to Practices
And the cost to practices from turnover
is enormous, much larger than most small to medium practices
may realize or be able to handle. The 2006 report by ACPE
pointed to costs that go far beyond the often-cited $250,000
recruiting costs and lost revenues.
These “soft”
costs may include lowered employee morale, as the practice
seeks to distribute the departing physician’s workload
and as support staff deal with possible emotional issues
involved in the disruption of the status quo.
Then there is the ripple
effect of workflow disruptions. Patients have to be reassigned,
support staff have to adjust to working with different
physicians, and physicians may have to spend precious time
training reassigned staff.
Patient care may also
suffer, resulting in inconsistencies and a potential downturn
in the practice’s reputation in the community. That, in
turn, affects patient referrals and the recruiting effort
itself.
At the same time, as
overworked physicians attempt to cope with the suddenly altered
reality, the practice will undoubtedly experience a significant
revenue hit, perhaps for a protracted period. Staff may need to
be let go. These additional stresses may actually serve to
exacerbate the situation. A desperate search committee may feel
pressured into making a hasty decision, bringing in a physician
who ultimately is not a good fit. And most recruitment
committees will feel pressures, as time passes and the costs of
the process climb.
Coping Strategies
The hard and soft costs incurred in
replacing physicians is why the number of medical groups
reporting having targeted retention initiatives in place
increased from 48 percent in 2004 to 58 percent in 2005,
according to a membership survey by the American Medical Group
Association (AMGA). However, the LocumTenens.com survey showed
that the majority of physicians responding to its survey had
not yet felt the effects of such programs. In fact, 35 percent
of respondents planned to change jobs in the next year and 53
percent expected to do so within three years. Statistics like
these frighten practice administrators. Accordingly, small and
large health groups throughout the nation have developed or are
in the process of developing retention programs.
One such group is Silver
Cross Hospital, a 250-bed facility in suburban Joliet,
Illinois, about an hour south of Chicago. Like many hospitals,
the administration decided it was financially impractical to
stay in the practice management business. However, they also
knew it would be problematic simply to unwind their physicians
from the practice with no support.
Over a nine- to 12-month
period, the hospital first used a health-consulting group to
gather information from the community and its physicians about
ways the hospital could support practices in light of
today’s relentless financial pressures. In 2004 it
launched a plan that, by and large, won the support of the
local physician community.
“We did a medical
staff development plan that would get us out five years,”
says Molly Scroggins, the director of physician relations.
“It was important that everybody agreed on what kind of
physician growth we’d be experiencing in these next five
years and how we would accomplish that growth, what kind of
market growth we would be experiencing and how we would grow
with the market and not let it outgrow us.”
With the basic plan in
effect, Scroggins makes sure that, if anything, the plan is
over-communicated to all physicians in the community.
“There are no secrets to the plan.
Our physicians know that we
are working with them on achieving success. We’re
succession planning with physicians nearing retirement and
we’re also helping to grow newer practices. We’re
being proactive in helping them to seed their practices. We
help physicians to identify better locations for office space
or maybe a better community within our market, trying to help
them grow the types of practices that they’re looking to
grow.”
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Increasing Your Net Worth — A Guide for New Physicians
Studies have shown that
recruiting costs to replace a physician can range
upward of $300,000 in today’s dollars. Add to
that the continuing loss of revenues that can
exceed $1 million and you have an obvious
prescription for a practice to develop a Physician
Retention Plan.
But, what about
the flip side of the equation? For physicians just
entering a practice, the question becomes
‘What is a good organizational fit worth to
you?’ Aside from the major upheaval to a
physician and her family resulting from leaving an
unsatisfying practice, there are the daily
tribulations and assaults on one’s
self-esteem and self-empowerment that arise from a
less-than-perfect fit. That is why physician
recruitment experts recommend that prospective
physicians develop a plan of their own to quickly
and seamlessly integrate themselves—and their
families—into a new practice. The result?
Stable and satisfying employment and improved
morale throughout the organization.
Ideally, a
personal retention plan should optimize your
adjustment experience. Here are some
characteristics of a personal retention program for
physicians entering a practice.
Congruity. Beginning at the interview stage,
your plan should insure that you are strongly
aligned with your prospective employer’s
philosophy, culture, and management style. Ask
whether the practice has a printed mission
statement or a set of guiding principles. If you
are a serious candidate, ask to see their employee
manual to better understand how those principles
are put into practice.
Interview the Interviewers. The interview experience can
be daunting, especially when a newly minted you is
interviewed by a cadre of accomplished, experience
professionals. But long-term relationships are
built on mutual expectations. Be prepared with a
detailed set of questions for your interviewers,
progressing from broad to specific concerns. And,
don’t be afraid to ask the same important
question of different personnel at appropriate
times.
Start before the start date. Even prior to your start
date there are several things you can do to
facilitate a seamless entry. If you have been
assigned a mentor, be sure to maintain contact and
establish a collegial relationship. Be sure to
arrange one or more follow-up visits both for
yourself and for the entire family prior to the
start date. Subscribe to the local newspapers and
look for opportunities to involve your spouse and
children.
First Hundred Days. Studies and anecdotal
records indicate that the first few months are a
landmark period for a new physician. Take advantage
and participate fully in your orientation program,
even though its value may not be readily apparent.
Also be open to whatever administrative and
technical support and training the practice offers.
It will invariably be easier to tackle that as a
new physician than later on when you are already
solidly booked and training time is at a premium.
Capitalize on every opportunity to introduce
yourself to the medical community, your prime
referral source. Attend social events with your
spouse. If concerns arise regarding job
expectations, including remuneration, now is the
time to raise them with the administration. Arrange
regular meetings with mentors and practice
leadership that include mutual feedback.
Retention Redux. Maximize your value to the
organization by taking advantage of professional
development opportunities. Insist on regular
performance reviews to assess your contributions.
If you are placed within a hospital setting, take
advantage of opportunities to interact with the
governing board whenever possible.
Communicate. Even with the best intentions, you
will undoubtedly run into the realities of family
life, revenue pressures, unpredictable professional
or community events, even changes in the larger
society that may effect your medical practice. The
best remedy is to actively involve yourself in
decisions that affect your career and to
proactively communicate with your practice
administrators about them.
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