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Hitting the business books: Finding a program that's right for you

Learning more about the business side of your practice takes time and effort. But it can give your bottom line a lift.

By Robert Kazel, amednews staff. July 28, 2003.

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Doctors can read a medical chart but might have trouble reading a corporate financial statement. They can write a prescription but would likely hesitate in writing a business proposal. They can dissect a cadaver but often not a standard HMO contract.

There's good news, though, for doctors who wish to shore up their business know-how: Opportunities and choices abound. Whether a physician wants to pick up immediately useful rudimentary skills or study medical economic trends broadly and deeply, programs are available, from one-day crash courses sponsored by medical societies to Internet classes and comprehensive master's degree programs.

Two decades ago, doctors who studied business were attending mostly university programs and looking to ascend corporate ladders to run large health care organizations. These days, when much of doctors' time is spent plugging holes in metaphorical dikes with escaping revenue streams, a working knowledge of the financial side of medicine is a virtual prerequisite to a healthy practice. Doctors are taking business courses to stay in business.

Many short, concentrated courses are available on practical topics and aimed at the practicing physician who has no previous knowledge of business. Four years ago, the Tampa-based American College of Physician Executives started to "retool" many courses so they would appeal to the average doctor rather than to would-be corporate barons, says Howard Horowitz, vice president for development of the organization. The ACPE offers a weekend course for doctors from smaller practices called "Learn the Business of Medicine." Held twice a year in various cities, it costs $750 and dishes out a taste of assorted business curricula.

"Many people say, 'I wish they had taught me these things in residency so I could have learned them by success as opposed to by error,' " Horowitz says. Subjects include "getting paid all that you are due," and "managing patient flow, referrals and income distribution." Some doctors pay extra to bring their practice managers to the workshop.

"More and more physicians are interested in it," says Harry Leider, MD, senior vice president of Philadelphia-based Interactive Forums, a health care consulting firm and one of the teachers of the workshop. "More and more doctors are realizing the advantage of having extra skills to manage their practice. The [workshop] teaches them a few basics and gives them an appreciation not so much of what they know as what they don't know."

Nathaniel Barnes, MD, a Houston urologist, went to the ACPE workshop in New York in April and says what he learned about undercoding alone might make a real difference to his practice.

"I believe we were leaving a big amount on the table," he says, adding that the workshop convinced him to have a coding trainer visit his practice to give the staff advice.

A disadvantage of nationally organized seminars is they may be held far from doctors' hometowns. Attractive alternatives are business courses taught via the Internet, CD-ROMs or tapes. Many of these courses cost less than in-person classes. ACPE offers about 20 remote courses; doctors watch recorded lectures and talk with medical colleagues in Internet chat rooms. The prices range from less than $300 to $600, Horowitz says.

State medical associations often offer convenient and affordable business classes, which tend to be brief and basic. Workshops backed by professional societies, educators say, are low-risk and usually a good first step for doctors unsure what they will gain by being students again.

An example is the Texas Medical Assn.'s two-day "Extreme Practice Management Experience" scheduled for July. The program, in Houston, planned speakers in breakout sessions on 25 topics, including maximizing medical collections, improving medical record-keeping, marketing with Web sites and brochures, and avoiding billing errors. The price: $249 for members. Other state societies have started offering their own Internet business courses. The Massachusetts Medical Society, for instance, offers a free online tutorial for doctors that teaches the essentials of managed care, including its terminology and the principles and philosophy behind it.

Also helpful are business-oriented materials on the Advocacy Resource Center on the AMA's Web site. Although not part of a course, the site is a large storehouse of articles and tools relating to HMOs, contracting, downcoding and bundling and includes model managed care contracts and model physician employment agreements.

A matter of degree

Physicians who are keenly interested in business have the option of postgraduate degrees, some of which are designed particularly for physicians and most of which combine periodic in-class attendance with Internet study. The cost of these programs, like many less-expensive seminars, might be partly tax deductible as a business expense if the doctor remains in health care after finishing the course work (an accountant or attorney can provide guidance).

Business degree programs require hefty investments in time -- usually 18 months to two years of part-time study. They are the choice primarily of young and mid-career physicians interested in professions such as chief medical officer, hospital CEO, managed care or drug industry executive, or entrepreneur. But some doctors opt to pursue an advanced business degree such as an MBA to run their practices more efficiently or to better lead colleagues, while remaining clinicians. The demand for more education on business issues has prompted some medical schools to offer MD-MBA combinations.

Some physicians seek out additional training so they know what's going on when key business issues come up.

John Born, DO, often attends meetings with executives of the Chicago-area hospital system in which he works, and decided he wanted to speak with more authority when financial decisions were at stake.

"It always seemed at these meetings that HR and the administration were on one side of the table and physicians were on the other side of the table," he recalls. "I wanted to bridge that gap. I felt there must be some way to solve this problem, and I would love to be part of that solution."

Dr. Born, a family physician, studied in a general MBA program at Benedictine University in northern Illinois and received the degree in 2000. Although he is now interim president and chief operating officer of a 45-doctor primary care system owned by Central DuPage Hospital in Winfield, Ill., he continues to treat patients and has used his business knowledge to improve his own practice's profitability. An expanded chronic disease management program, more efficient billing and collections, better contracts with HMOs and a streamlined office personnel structure have been some of the products of lessons learned in class, he says.

David Klein, MD, who expects to complete a two-year medical MBA program at the University of California, Irvine, this month, traces his desire for more education to prior befuddlement when trying to talk business with hospital administrators.

"I really felt naked without business training," says Dr. Klein, a general surgeon in Las Cruces, N.M., and president-elect of the New Mexico Medical Society. "I found myself sitting through all kinds of board meetings where they would discuss balance sheets and income statements and financial matters, and I really found myself disadvantaged. So much of medicine is business-related."

But Dr. Klein says pursuing an MBA might be the wrong choice for someone only casually interested in business or someone not willing to make a major time and financial commitment. The school's MBA program cost him $57,500 for two years of part-time study; classes met Thursday through Sunday, though he found himself doing homework all week long.

Those who manage physician MBA programs agree that doctors who want to run a more profitable practice but don't aspire to be high-level executives should look first to seminars and workshops, rather than a degree program.

"If one has no motivation to learn subjects like finance, strategy, business planning, economics or cost-based accounting, that stuff can get really boring," says Michael Stahl, PhD, director of the University of Tennessee's one-year physician executive MBA program. "If you take courses like that and you're bored to tears and think, 'Who are they kidding?' that tells you a lot."

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