Part-time medical director: way station of end of the line?

If you are thinking about a career change from clinical practice to management, perhaps you are considering a transition phase as a part-time medical director for a local HMO, insurance company, hospital, etc. Probably, you have even been approached by a local company to apply for such a position. The first and most important point to keep in mind is that this part-time position is not a management position, no matter what anybody thus you. You may be involved in management meetings, but you will not, in reality, exercise management authority.

First, no real manager works part time. Although you may attend some or all important management meetings, 90 percent or more of the necessary operational decisions are made concurrently and cannot wait for your next scheduled time in the office. Informal communication is vital to any organization. It forms the relationships and establishes the dynamics that ultimately determine the success or failure of an organization. Thus, unless you are present and accessible most of the time, the management team will not include you in the informal communication system or develop a reliance on your input.

Second, no matter what they tell you, there is an underlying bias of nonphysicians to assign a certain special role to physicians. All their lives, these business people have related to physicians in a clinical setting as patients or parents, not as co-workers. They may have negotiated with physicians, provided professional services to physicians, or had any number of other relationships with physicians, but, by and large, they are not accustomed to seeing physicians in a management role. It will take a great deal of time, effort, and contact with other nonphysician managers to overcome this bias and be perceived as a credible manager.

Third, when an organization decides to hire a part-time medical director, it is usually the first step in a process that leads to hiring a full-time physician executive. You are the organization's first physician in a management role. What perceived or real need finally caused the organization to act? In a majority of situations, there is a perception that the organization needs a doctor to talk to doctors. That is all well and good, but it can go too far. If that is why they hired you, they do not want you "wasting your time" talking to anybody else! Even a physician organization has numerous important business relationships and contacts with nonphysicians. In fact, the growth of the American College of Physician Executives is indirect evidence of the increasing number of organizations that have discovered the value of physicians as senior managers. How can a part-time medical director assume an important management role if he or she is limited to communicating with physicians, and largely about clinical issues? Overcoming this hurdle can be very difficult and requires a high level of assertiveness and flexibility and excellent communication skills.

Last, you will not be line management--i.e., you will have no supervisory authority or bottom line responsibility. Staff (or advisory) roles can be extremely influential in an organization. You may have skills and credibility to advise on clinical issues. However, what are your proven skills and accomplishments in a management role? You must acquire those skills and gain that experience to become a credible advisor on business issues. The best way to do this is through line management, even if that is at a relatively low level of responsibility. There is a "Catch 22," however. Line managers need to be available and accessible full time, and you are being hired for part-time work.

If you are serious about changing careers, not just replacing clinical time with other activities, you should consider a full-time commitment to management activities and acquire formal management education, such as that offered by ACPE and other institutions. I am not arguing against taking on a part-time position. What I am saying is that a part-time medical director role may not be an appropriate transition for those of you who want to "try" management to see if you like it, because that role may not be management. In addition, it may not meet the needs of those of you hoping to acquire the experience and skills to move on to more important full-time management positions.

Let us turn our attention to what you probably will do as a part-time medical director. I have chosen to explore that role in the community hospital and in managed health care organizations. Because there have been a number of articles about the role of physicians in the management of hospitals, and because my experience is primarily in managed care, this article will treat managed care more fully than the hospital situation.

Hospital Role

Although in the recent past most part-time hospital medical directors have been volunteers (not paid), that is quickly changing. Very large hospitals have been providing a stipend for part-time medical directors, and most hospitals now pay for a physician's part-time assistance in hospital management.

There is some commonality between full- and part-time medical directors in the hospital setting. Specifically, physicians are placed in this role, whether it is full-time or part-time, primarily because of the perception that there is a benefit in having a doctor talk to a doctor. The most significant expected benefit is that physician behavior can be changed by "jaw boning," and a physician has more credibility with a physician than a nonphysician administrator does. This is a belief shared by many nonphysicians in hospital management.

It is far more difficult for a physician to take on a management role in a hospital than in any other organization. Why is this? The cause, in part, is a strong and not very subtle antipathy toward physicians that is shared by many in hospital administration. In the past 30 years or so, there has been more conflict than cooperation between hospital management and the medical staff. Very recently, we have begun to see a growing realization by progressive hospital administrations that cooperation with the attending medical staff may be the best and only means to survive the tough times ahead.

Another significant barrier to physicians' assuming a significant management role in hospitals is that the major portion of the contact between hospitals and physicians has the physician in a clinical role. Typical scenarios of contact are in the credentialing process, the thousands of interactions having to do with direct patient care, personnel problems, crises caused by physician staff interactions, and resource allocation issues in which physicians focus on individual patient care issues while administration must consider the big picture. These experiences produce a strong bias on the part of hospital management to see physicians as anything but businessmen or managers.

If we were to characterize the role of the part-time hospital medical director, it would be primarily as a communicator to physicians. That communication would occur in relation to such functions as:

* Utilization Review. The hospital needs to have a patient discharged and someone must talk to the attending physician to make that happen. Data reveal that a physician is overutilizing hospital resources compared to peers, and behavior change is necessary to prevent economic loss for the hospital.

* Quality Assurance. Action must be taken because of a potential or real quality issue relative to patient care. This can include dealing with an impaired physician, whether related to substance abuse, emotional problems, or age.

* Credentialing. The medical staff must perform the credentials review on the basis of JCAHO standards and make recommendations to the hospital board of directors. It is usual and useful to have a physician coordinate this process and act as liaison between the medical staff and the board on this issue.

* Counseling or Sanctioning Physicians. This function would encompass more serious patient care problems and any problems involving physician behavior. In this instance, the medical director would be called upon, sometimes urgently, to investigate a problem, present the issues to administration, and then achieve behavior change by the physician or initiate sanctions.

* Recruitment and Retention. This role should be, and usually is, one of the more enjoyable. The medical director can be involved at any or all points of the process--identification, recruitment, and retention of physicians needed on the hospital's voluntary or employed staff.

* Attend Medical Staff Committee Meetings. In this function, the medical director represents hospital administration on required (JCAHO) medical staff working committees. Whether as chair or member, the medical director ensures that the interests of the hospital are fairly represented and that all required functions are completed. In most of the above situations, the part-time medical director acts as an instrument and at the direction of hospital administration. That role is limited to relating to individual members or groups of the medical staff. The position is strongly "staff," in that there is no direct supervision or bottom line responsibility. In general, any interaction with nonphysicians is through or with other members of the management team.

Managed Health Care Organization (MHCO) Role

The role of the part-time medical director in an MHCO has some similarities to the hospital situation, and many differences. In managed care, communicating with physicians is an important aspect of the role, but occupies only a small portion of the medical directors committed time. In managed care, there is also an important "political" function, but again not nearly as important as in the hospital. The major portion of each month of the physician's part-time commitment is dedicated to reviewing, making decisions, and signing literally hundreds of forms that require a physician's signature. Unlike in the hospital setting, the medical director in a managed health care organization (MHCO) is often the only physician working for and within the organization.

The actual functions of the part-time medical director in an MHCO seem, on the surface, similar to those in a hospital setting but, in fact, are very different. Of those functions, some of the more important are utilization management, quality management, provider network management (including recruitment and retention), credentialing, benefits administration, claims support, member services support, information systems support, and support of physician committees. This sounds important and exciting, but, unfortunately, the truth is that the major responsibility is processing forms having to do with the medical necessity of, and therefore reimbursement for, literally hundreds or thousands of individual occurrences of health care. Thus, the job is largely "paper pushing." In addition, the medical director may be expected to communicate directly with physicians on a number of these individual cases to address cost and quality issues.

In utilization review, the medical director composes (or assists in composing) and approves criteria for medical necessity and then determines coverage based on those criteria. At times, the medical director will be expected to determine the appropriateness of health care decisions made by other health care providers, including physicians. This determination may be made prospectively as a prior authorization for outpatient services, concurrently as a decision on continuing inpatient care, or retrospectively on a service already provided but not reimbursed. The medical director is assisted in these processes by nurses and lay staff and must provide medical knowledge support and teaching for these employees. Also, there is usually some responsibility for analyzing routine utilization performance reports and suggesting actions based on the reports. Case management, the design and implementation of cost effective alternative health care delivery methods, must have physician support. As a last resort, coverage or payment is denied. That assumes, in most organizations, that a physician--the medical director--has made the determination and provided a signature on the necessary form.

Quality management often represents the part-time medical director's best opportunity for a leadership experience. As a general rule, external agencies that review MHCOs, such as the National Committee for Quality Assurance, the Office of Prepaid Health Care (federal qualification), or clients of MHCOs, expect that a physician, typically the medical director, will take a major role--preferably a leadership role--in this area. Thus, the medical director would be expected to approve, if not write, the quality assurance plan document and all criteria. In addition, he or she should assume an active role in evaluating the quality of health care, supervising all quality studies, and creating any action plans to improve quality based on an analysis of routine reports and any special studies. Unfortunately, not all organizations structure their quality programs in this way. In some organizations, the part-time medical director plays only an advisory and passive role in most of the process, getting personally involved only to evaluate a specific case when there is need for direct communication to a physician.

In provider network management, the role of the part-time medical director is usually limited. In general, negotiating and contracting with providers is accomplished through full-time staff with occasional minor involvement or advice from the medical director. The medical director usually provides important advice on reimbursement policy and levels, including risk pools and incentives, but managers with bottom line responsibility are likely to make the final decisions. Network design (e.g. quantity, specialty mix, and location) is an area of possible involvement of the medical director, but this usually falls to the full-time staff, with advice from the part-time medical director. Provider services and communication is the area in which the part-time medical director can play the most significant active role.

As in the hospital setting, the credentialing process is the MHCO operation that provides the best opportunity for independent action and leadership for the part-time medical director. This process requires the medical director to draft requirements and standards, with the advice and approval of legal counsel and final approval of the board. The medical director reviews applications, including malpractice experience; ensures that peer review occurs as needed; and monitors provider performance as to cost, quality, service, and (for recredentialing) compliance with the MHCO contract. In this process, the part-time medical director will generally experience the greatest support for, and reliance on, his decisions.

The area of benefits administration probably makes the MHCO role most unlike the hospital or any other noninsurance organization role for a physician manager. This area again provides a real opportunity for the part-time physician manager. At issue here is physician judgment as to the medical necessity or appropriateness of proposed or delivered services, and there is a legal and marketing need for physician involvement. Functions would include researching and drafting medical policy and procedures for reimbursement decisions, including criteria for coverage. The medical director routinely reviews all proposals for services when criteria are not met, when prior authorization is required, when new technology is planned, and when noncontracted providers are to deliver the services.

Information systems are the life blood of an MHCO. A physician manager can play a vital role in this area, but a part-time physician manager must be particularly assertive and sharp to achieve a change in priority from routine financial reports and claims processing to useful utilization reports. Accurate, simple, easily understood reports are a powerful tool for analysis and provider behavior change. A physician manager can be particularly helpful in this area as he or she regularly monitors the results of health care delivery operations and makes recommendations based on these results.

Well-run physician committees can be extremely useful to an MHCO. The part-time medical director may be the chair, a member, or just staff (similar to the hospital situation). In an MHCO, unlike the hospital, there is an opportunity for independence of action and control, especially when the organization is physician-owned or -managed. This can be a great opportunity for the new manager to learn and practice group management principles.

In this article, I have attempted to provide information mostly directed to physicians who, because of frustration with the practice of medicine, because they no longer find fulfillment in full-time clinical practice, or because of other reasons, are contemplating a career change to management. When the first step is a move to a part-time management role, the desired career change may be short circuited. The part-time physician manager is not exposed to the same range and depth of management duties and responsibilities that a full-time manager is. If full-time management is the ultimate goal, consider taking the plunge at the outset.

Lowell M. Weiner, MD, is President of L. Weiner & Associates, Inc., consultants in managed health care, Carmel, Ind.