DOCTOR DOUBLE.

Some black physicians do double time managing their practices as well as other entrepreneurial ventures

THE PROGNOSIS FOR HILTON PUBLISHING INC. IS A LONG, healthy life. But such a sanguine future didn't appear to be in the cards for the Roscoe, Illinois-based company after it was launched in 1997. Growth didn't come as expected, and that was attributed to a steady diet of manuscripts by Waiting to Exhale Part II wanna be authors, fast-food fare for a young company that needed serious sustenance.

When a patient's life is in jeopardy, the doctor is usually called; in this case, Dr. Hilton M. Hudson II, a cardiac surgeon, was already on the scene--Hilton Publishing is his creation. He diagnosed his company's condition and discovered that the problem was, indeed, its diet. He prescribed large doses of nonfiction in the form of health-related books for African Americans, and it worked. Hilton Publishing's sales were $225,000 in 1999, exceeded $350,000 in 2000, and are expected to hit more than $500,000 this year.

A busy African American physician with a business on the side? It's not all that unusual. In fact, considering the low regard that some physicians have for managed care, the probability is high that more doctors will test the entrepreneurial waters in the future. The physicians' main gripe is that the system has too much control over their earning power.

Dr. Darryl Wayne Peterson, a Baton Rouge, Louisiana, orthopedic surgeon, says that his profession is one of the few that "every year, in spite of inflation, what we get paid goes down. Every time you enter into a contractual agreement to work with a healthcare provider, they're constantly trying to negotiate you down." His assertion is supported by statistics from the American Medical Association: Median physician net income (after expenses and before taxes) was $160,000 in 1998, down from $164,000 in 1997. That's a 2.4% decrease that becomes a 4% drop when adjusted for inflation.

In order for a physician to maintain current income levels, Peterson says: "You have to work harder--more hours, more encounters; work smarter--improve efficiency, automation, consider partnerships; or you have to have outside interests." Some doctors are teaming up with others to start or acquire ownership in diagnostic centers, which offer, for example, MRI scans and other services unavailable in the physician's office.

Lorraine Cole, Ph.D., the former executive director of the National Medical Association in Washington, D.C., an organization that represents 26,000 African American physicians, echoes Peterson's sentiments that the overriding concern among black physicians is the impact that managed care is having on their practices. To offset any income loss, some doctors, Cole says, have started doing "practice-based research" by getting involved in more clinical trials in partnership with pharmaceutical companies. Such involvement suggests that doctors naturally have, or have acquired through experience, a taste for entrepreneurial challenges. It also suggests that we're likely to see more physicians making their mark in the world of business outside of medicine.

"Medicine in itself is a business," explains Dr. Gilbert R. Parks, a psychiatrist in Topeka, Kansas, who has transformed a passion for astronomy into what he hopes will be a profitable venture. "One of the things that many physicians struggle with is that when the business part of medicine came to be more demanding in the last 10 to 15 years, it put doctors at a disadvantage because they were not as business savvy.... Other people stepped in, and said, `We'll do that piece,' and they took over medicine by taking over the business piece of it."

Whatever their motivation for getting involved in entrepreneurial activities, doctors are returning to school to get M.B.A.'s--increasingly more aware of what they don't know about business. Susan Stevens, director of the M.B.A. program for physicians at the University of South Florida (USF) in Tampa, Florida, the first school to offer such a program, says that the number of medical professionals pursuing M.B.A.'s is rising. "Managed-care organizations want physicians in management-level positions, and doctors realize that in order to compete for those jobs, they must have some business skills," she says, citing one reason for the program's popularity. Since the program started in 1991, it has graduated 250 physicians.

Dr. Randall C. Morgan Jr., an orthopedic surgeon who practices in Merrillville, Indiana, is expected to complete his M.B.A. requirements in May 2001 at USF. He is president of The Orthopedic Centers, a practice he started in the mid-'70s. "The degree will allow me to have a place in the practice when I begin to slow down in terms of actually doing orthopedic surgery, which is pretty strenuous," says Morgan, who at 57 is preparing himself for the day when he will stop seeing patients and start doing more of what he enjoys--strategic planning and consulting.

Hudson, the founder of Hilton Publishing, doesn't have an M.B.A., and judging by the success of his practice in Rockford, Illinois, apparently he doesn't need one. It seems only fitting that this Indiana University English and math major and avid reader would one day be drawn down the path to publishing, a concept he discussed with his former English professor, Herbert Stern, Ph.D., who is now the company's vice president and editor in chief. With a $400,000 bank loan, Hudson opened Hilton Publishing in 1997. The goal was to publish fiction, but the submissions the company received were about "how to get a man or keep your man or how to get a decent woman," he says. After a year, he reevaluated the company's mission and decided, after doing extensive research, to publish health books for blacks because the "statistics are horrific."

"We made it our mission to publish books for African Americans and other minorities and to demystify medicine," says Hudson. "It just doesn't make any sense for our people to live [shorter lives] than other folk."

By that time, Hudson, with the help of Stern, wrote The Heart of the Matter: The African American Guide to Heart Disease, Heart Treatment and Heart Wellness ($24.95). Told by an editor at a major publishing house that they wouldn't publish the book because it wouldn't sell, Hudson decided to publish it via his own company. It was the company's first publishing effort. The book sold well, mainly because Pfizer Pharmaceuticals, which had agreed to help sponsor the book, purchased thousands of copies and distributed them to African American doctors and their patients. "Our biggest clients are drug companies and governmental agencies that need access to these books to educate people," Hudson says.

Last November, the company published The Black Man's Guide to Good Health: Essential Advice for African American Men and Their Families (Revised), a book that addresses the prevention, diagnosis, and treatment of cancer, by James W. Reed, M.D., Neil Shulman, M.D., and Charlene Shucker ($16.95). A third book that addresses the prevention; diagnosis, and treatment of cancer will be released this spring.

Hilton Publishing employs four, and the team handles the firm's day-to-day decisions, allowing Hudson the freedom to pursue his first love--cardiac surgery.

While Dr. Eddie Cheeks' first wife was losing her battle with breast cancer, he was forced to assess his relationship with his profession. "I realized how very important medicine is to me," he recalls, "but at the same time, there has got to be an easier way--a different way--to try to make a living rather than just working as hard as we do in medicine." Physicians make a good living, but physicians don't become rich practicing medicine. "If Dr. Cheeks does not deliver a baby or perform a surgery, then Dr. Cheeks does not get paid," he says cynically.

Cheeks, an Augusta, Georgia-based obstetrician-gynecologist, says, such thinking made him more receptive to investment possibilities outside of medicine. The result was an investment in a Church's Chicken fast-food franchise. Cheeks has also invested in a group of medical clinics, but his pride and joy is the National Legacy Foundation, a public charity with a broad mandate to fund a variety of causes.

The chicken franchise, in southwest Atlanta, came about because Cheeks' second wife, Monique, had a friend who worked for Atlanta-based AFC Enterprises Inc., the chain's parent company. AFC was offering incentives on franchises because they wanted to attract more blacks (see "Fast Track to Profits," Enterprise, this issue). In the mid-'90s, Cheeks, along with two partners, created a strategic plan and paid a $5,000 franchise fee and construction and development costs for one chicken outlet, which typically has sales of more than $600,000 a year, according to Ellen Hartman, vice president of corporate communications for AFC. The price paid by the partners did not include developing the site, but all Cheeks would divulge about that cost was that it came "out of pocket."

Herman Morgan, one of the partners, manages the five-employee outlet. Cheeks contends his franchise is a profitable venture, with 2000 revenues topping more than $500,000.

"This was a good way to get into business, outside of medicine, without having to spend a lot of time developing and operating a new system," he says. The experience taught him a few things and whetted his appetite for the business world. His next venture led to him becoming part owner of MedTrust Management Inc., which owns and manages two clinics in Augusta. Last year, MedTrust grossed nearly $2 million in revenues.

"I love what I do," says Cheeks, who's practiced medicine for nearly 20 years. "I didn't go into medicine to make money. I went into medicine to take care of patients, and for that reason I practice differently from many other doctors and probably make less money as well. But I live very comfortably. I'm not rich; that's why I still work. I'm a country boy and a realist, but I do have an affinity and love for business."

Cheeks wants his investments to make money, of course, but his primary motive is the legacy he leaves his four children. "I can't leave them my medical practice. But I can leave [them] my ownership in the medical clinic. I can leave [them] my ownership in the Church's Chicken business (which we still plan to grow), and I can leave [them] the National Legacy Foundation, which I hope will be a multimillion-dollar charitable organization within a couple of years," says Cheeks.

Give Parks, the Kansas psychiatrist, a minute of your time and he'll take an hour to enthusiastically explain why he has pumped $100,000 into Atech Inc., a company that hasn't made a dime since he and his sons, Grywin and Ronce, founded it in 1998. Putting aside the technical jargon, Atech's (which stands for astronomical technology) mission is to get blacks interested in astronomy. One of the ways the company hopes to accomplish that is by using cutting-edge technology to enhance one's experience looking at the stars through a telescope. Parks believes that the technology that Atech has developed so far, and what is on the drawing board, should prove marketable to both the business and education sectors.

"It's losing money right now," says Parks. "But it will not be a money loser in the long run. In many ventures, you have to put money into them for a while before posting a return." The company's five employees (prior to joining Atech) had done some contract work for NASA, "but we haven't gotten to the large level that I know we're going to get to," he explains.

Parks has committed himself to transferring the technology Atech has developed to predominantly black colleges first. "Really, what I want them [black colleges] to do is get departments of astronomy," he says. He was instrumental in helping South Carolina State University acquire a science and technology research grant from NASA.

Dr. Edith Irby Jones, a Houston physician who specializes in internal medicine, believes that doctors don't need to be "completely wed to doing one thing," and she certainly practices what she preaches.

Right after she and her late husband, James Beauregard Jones, got married in 1950, they bought a house in Little Rock, Arkansas, for $5,000, starting a pattern of buying real estate that today has culminated in a small empire of some 30 properties in three states. "If tomorrow they decide they're not going to pay any doctors, I could still deliver healthcare and I wouldn't starve to death. Having [outside] entrepreneurial interests gives you a sense of independence, an ability to be able to express opinions without the fear of having your livelihood discontinued," says the 73-year-old dynamo who, in addition to managing a full-time practice and a business, is a clinical assistant professor of medicine at Baylor University School of Medicine and the University of Texas School of Medicine, both in Houston.

Her husband, who was a dean at Texas Southern University and who, Jones says, had more free time, managed the properties. She sold a handful after his death 11 years ago, but has retained the bulk of the business, most of which is in the Houston area. Jones still owns that first house in Little Rock and some other Arkansas properties, along with 80 rural acres with a "family house" in Louisiana. She oversees the management of her unincorporated real estate business, which employs four, out of the same office used for her practice, which is in Houston's Third Ward.

The rental income the properties generate and the other sources have abetted her philanthropic activities, which include awarding scholarships and providing pro bono medical services to patients who can't afford healthcare in the U.S. as well as in Haiti, where she has set up a clinic in her name. She has another clinic in Uganda, where she offers supplies and medication. "I strongly feel that what you get is supposed to be shared and that it does not really belong to you. It's only yours to have a stewardship over."

Her real estate business serves as both an investment and a way to give back, she says.

Parks, who is chairman of a local Community Development Corp., says he has "dabbled" in a number of entrepreneurial ventures over the years. For about 12 years, he and a group of investors owned a credit union, which got caught up in the "S&L fiasco" in the late '80s and failed.

"I'm a human-services kind of person," he says. "No matter what, it really was more of aiding the community because it needed economic support. It's about helping to develop black health, minds, and businesses."

Entrepreneurial Resources

When you think of second careers, you usually think of those who have turned to a new profession after toiling for decades in a totally different field. Judging by the doctors portrayed in this article, you don't have to surrender your main livelihood to sit at the entrepreneurial table. If you're interested in a new career or you need questions answered about realizing that other dream, the following Websites and books may help:

WEBSITES

www.sba.gov: The Website of the Small Business Administration is the first place all entrepreneurs should check to get answers to basic questions about starting a business.

www.franchisedoc.com: Interested in a franchise? This address for the Franchise Doctor is one of many sites dedicated to answering questions about franchising.

www.nase.org: This site, for the National Association for the Self-Employed, offers members a range of services--from tax help to health insurance programs.

BOOKS

Finding Your Perfect Work: The New Career Guide to Making a Living, Creating a Life by Paul Edwards, Sarah Edwards (J. P. Tarcher Publishing, $16.95). "... Helps readers define what they really want in life and lists more than 1,600 self-employment occupations with rating scales for determining their suitability to readers' personal styles, resources, and lifestyle needs," says the editorial review at Amazon.com.

Second Lives: Becoming a Consultant by Bill Harris and Charles L. Sodikoff (Griffin Trade Paperback, $9.95). Second Lives is a series written for people who are considering starting a second career and who already know what their interests and skills are.