Physician-led: good idea or not? (Climbing to the Top).

PHYSICIAN-LED IS THE mantra of those who believe the U.S. health care system is misplaced in the hands of bureaucrats, managed care plans and predatory profiteers.

Champions of the physicians' cause believe that if doctors regain control of health care, waste and inefficiency will be eliminated, limited resources better allocated, clinical outcomes enhanced and service improved. Health professionals will also recoup a sense of personal pride and joy in their work.

Critics point out, however, that the physician community is, by and large, a fragmented cottage industry in economic crisis. They add that, until physicians better organize and manage themselves, they are ill prepared and unqualified to assume control of a trillion-dollar health care industry.

Let's examine the list of requirements for physicians who are interested in positions of leadership within the U.S. health system, particularly management of larger medical group practices.

Emphasize efficiency and effectiveness

For many physicians, efficiency is "whatever makes my day better for me." Effective management is "whoever gets what I want done faster than the last person I ordered to do it."

While delivery of patient care may require minute-to-minute direction of people, technologies and supplies, the management of a health system requires a longer view of resource allocation given an array of unpredictable alternatives. Each offers its own risks, rewards and implications for the organization and community.

Health care resources will always be limited. No resource is limitless. Consequently, leaders must make difficult resource allocation decisions to balance a range of short- and long-term organizational needs and goals.

Exercising leadership for the long term often puts physician leaders at odds with colleagues who are frequently more focused on the here and now.

Empower leaders

Physicians are typically consensus-focused, sometimes to a fault.

In many situations, a democratic model of decision making typically would be an improvement. But the differences between democracies, consensus and leader-directed organizations are marked.

Decision by consensus among physicians typically means the more vocal of those who show up at any leadership meeting overly influence the decisions. At least a democracy involves a majority vote. As circumstances and the related decisions become more important or critical, there is a need to narrow the area of the decision making to empowered leaders.

While dictatorships rarely endure, there is a reason why field generals make key decisions in the heat of battle. Every key decision comes with time pressures. For physician-led organizations to succeed, they must be willing to empower leaders to lead, which sometimes includes making decisions that do not allow for every opinion to be heard before action is taken.

It's important to remember that leadership is different from management. While both are important and interrelated, leadership is simply defined as doing the right thing at the right time. Management is doing the right thing well.

Consequently, the right thing done at the wrong time due to an inefficient or belabored decision-making process produces no value.

Value the role of leadership

Many physicians view health system management as secondary in importance to patient care. They claim medicine is more important because "lives are at stake."

While true at times, not every patient encounter is a life-and-death situation. Likewise, not every strategic, managerial or investment-related decision is less important than patient care.

For physicians to be true leaders, they need to respect the importance of the role. Physician leaders should not think less of themselves or their roles and responsibilities because they are not frilly productive doctors anymore. Physicians in leadership roles are not practicing "administrative medicine." Management is management. No apologies required.

If physicians assume prominent leadership roles in provider organizations, they need to commit to the longer term. This commitment is difficult for all physicians.

Many see physician leadership as a point of no return because it becomes impossible to go back to productive clinical practice. Clinical skills are lost, the physician leaders do not stay current in their specialty and full-time practitioners assume the practice opportunity.

It will be impossible for physicians to take over leadership of the U.S. health system on a part-time/short-term basis. Many who try to both practice medicine and manage business undoubtedly admit that they keep up with the day-to-day tasks, but longer-term, creative planning and development suffers.

Respect structure

Physicians often equate organizational structure with bureaucracy, and bureaucracy with incompetence and ineffectiveness.

Effective organizational structure is all about resource leverage. "Leverage" is generally defined as applying organizational resources to increase or enhance business results. Some level of bureaucracy is required in any organization.

Effective organizational structure enhances resource leverage. Physician organizations are typically designed to be relatively flat, meaning layers are minimized. While sometimes viewed as efficient because physicians can directly cause action by a number of people with a single contact, in flat organizations leaders remain excessively involved with high levels of detail on a day-to-day basis.

Leaders who concentrate on daily activities may be fulfilled by the work, but advancement of the organization may suffer.

Invest in leadership competencies

Effective leaders may not be the toughest negotiators, the best clinicians or the most gregarious people. There is no standard personality or intellectual profile for effective leaders.

Likewise, it usually takes more than raw talent to effectively manage large, complex organizations. They require specific business and leadership skills. These skills can be acquired, but as with medicine, there needs to be a commitment to acquire the skills to build the competencies.

While not every physician leader needs a graduate-level degree from a business school, there are certain core curricula requirements including:

* Finance

* Microeconomics 

* Organizational design and development

* Health law

* Marketing

* Basic accounting

* Strategic planning 

* Asset investment methods

Many health organizations, at least those traditionally led by physicians, do not invest in developing the leadership and management competencies of leaders and potential leaders. There are two reasons for this:

1. Leadership positions are rotated with relative frequency. A medical practice, even the larger ones, may have a new president every two to three years.

2. No one is in the leadership positions long enough for the investments to pay off.

Create positive culture

Organizations succeed or fail based on their cultures. And values drive culture. (1)

"Culture" is not one of those ethereal ideas that business school professors contemplate. Culture is the most practical and useful construct to advance the interests of an enterprise, including health care organizations.

Values are the tools of culture.

Clear values help manage the challenges of the most difficult decisions. They allow leaders the answer to the most important question: What is the right thing to do?

Culture is also the glue that binds an organization. The recipe for the mix is, again, the values. If a physician can do only one thing during a leadership term, let it be the purposeful development of organizational culture by clarifying and promulgating strong values.

Always follow through

Good clinicians follow through on details of patient care.

But it is curious to see good clinicians fail at leadership and management due to lack of detailed follow-through.

Conversely, successful physician leaders climb organizational ladders because people can rely on them to remember and follow through when they commit; the smallest detail is not overlooked.

The most frequent excuse for lack of follow-through is "I got busy with my patients." Busy with patients is okay, but if critical organizational progress is impeded, choices are required.

Care for the whole

Good clinical care often requires physicians to ignore resource costs in favor of patient welfare.

When it comes to organizational welfare, the physician leader does not enjoy this luxury. The principal concern is welfare of the whole.

This issue becomes all too real at budget time. Since health care organizations are, by and large, collections of small businesses--individual clinical departments or programs--they have unique needs.

Most argue for resource allocations based on patient welfare or quality of care. While there is usually some truth to the plea, the physician leader must balance the costs of state-of-the-art care within a particular specialty against the needs of other clinical departments. The likely return on alternative investment opportunities must also be considered.

It is here that physician leaders risk unpopularity. They are required to effectively balance the needs of the individual department against those of the whole.

At one extreme, the leader risks favoritism. At the other, the leader faces organizational mediocrity from spreading inadequate resources across multiple clinical departments and ensuring that no one receives enough.

Hire, fire and discipline

Physician leaders are often at least partly responsible for hiring, firing and disciplining colleagues and peers.

Some positions may include a legal responsibility for the actions of colleagues and peers--based on whether the physician leader is a company officer or other fiduciary.

Physician leaders often loathe and resent holding accountability for the behavior of peers, especially when they must act on those behaviors in an official capacity. Further, some fear retribution from colleagues and peers for taking action as leaders.

Some physician leaders say sanctioning a colleague means lost support by that colleague and perhaps by others when they look at the leader's role as a clinician.

Actionable behaviors are sometimes overlooked, minimized or set aside in deference to collegial expectations. Unfortunately, this can happen when decisive action is not only in order, but perhaps required for the good of the organization and by legal mandate.

Except for the most egregious infractions, physician leaders should rarely, if ever, act alone. In fact, to sanction a colleague in the absence of support from other physician leaders in the organization is either a failing of the organizational design or a personal failing of the physician leader.

To the extent that physician leaders are involved in important personnel decisions affecting colleagues and peers, they should be participants in a well-designed process born from approved organizational policy.

At worst, senior physician leaders may need to temporarily suspend a doctor's privileges pending a formal review process. But physician leaders should never be placed in the position as sole decision makers regarding the hiring, firing or disciplining of other physicians.

Measure success

How do we know when physician leaders succeed?

Is success measured by organizational profitability, market share, physician happiness, patient satisfaction, staff retention, defensible measures of clinical quality or organizational growth curves?

Measures of success are derived from organizational plans and objectives. Measurable objectives are products of a plan.

Success is defined variably in the life cycle of an organization. One year it may be top-line growth, while in another it is bottom-line performance. Measures of quality and service are constants. Effective physician leaders need to make sure their organizations define objectives and implement measures of progress toward those objectives over given time periods

The best physician leaders will use measures of progress as scorecards for the organization, ensuring that resources and efforts are effectively applied to keep progress in balance.

It is possible to favor one or several objectives to the detriment of others, causing imprudent application of assets and efforts -- such as achieving high-quality service while losing market share to competitors. But effective physician leaders will keep the organization abreast of progress made and the costs paid.

Physicians can lead

Are physicians able to lead the U.S. health system? The answer is yes, but not every physician possesses the potential or qualifications to lead.

Earning a medical degree and completing a residency program does not predispose an individual to lead. Likewise, adding an MBA to a medical degree, while helpful, is not sufficient qualification at the highest levels of a large, complex organization.

While perhaps controversial, effective leadership of medical groups and health care organizations, overall, is probably more about behaviors and process than personality and intellectual profiles.

Daniel K. Zismer, PhD, is the managing principal of Dorsey Health Strategies, a consulting firm affiliated with the global, full-service law firm of Dorsey & Whitney LLP. He can be reached by phone at 612/492-6411 or by e-mail at [e-mail].

Bjorn Flygenring, MD, FACC, is president of Minneapolis Cardiology Assoicates, a 40-physician cardiology group practice, integrated with the Minneapolis Heart Institute and Abbott Northwestern Hospital. He can be reached by phone at 612/863-3728 or by e-mail at [e-mail].

Brian Campion MD, MPA is a professor at the College of Business, University of St. Thomas, St. Paul Minn. Previously, he was the CEO of Franciscan Skemp Healthcare, Mayo Health System, Lacrosse Wis. and practiced cardiology for 20 years. He can be reached by phone at 651/962-4136 or by e-mail at [e-mail].