Benchmarking, an idea recently popularized in industry, is creeping into practice management.
Strictly defined, benchmarking means comparing aspects of your organization's performance with those of others -- usually the leaders.
For physicians, it means replacing practices learned from personal experience, role models and journal articles with those based on proven, measured results.
It's a tough transition, particularly in clinical areas. Nevertheless, some are convinced that benchmarking will become critical as payers seek the best care at the lowest cost.
The Medical Group Management Association has identified benchmarking as a hot issue. The organization, with 17,000 individual and 6,000 group members, is attempting to develop the most reliable benchmarking database -- one where practices of all sizes and payer arrangements will be able to compare themselves to peers.
"Benchmarking will be critical to your success in this age of accountability," MGMA President and Chief Executive Officer Thomas Adams told about 300 attendees at the association's first benchmarking symposium last month. It was co-presented by the MGMA's research arm, the Center for Research in Ambulatory Health Care Administration, and the J.L. Kellogg Graduate School of Management at Northwestern University.
Starting in 1998, the MGMA will offer a benchmarking product based on its annual cost survey as part of a new and enhanced membership benefit package. It expects to roll out a patient satisfaction product early next year in a joint venture with Response Technologies, a subsidiary of HCIA, a Baltimore-based healthcare information company.
That will be followed in late 1998 or early 1999 by a tool to measure physician efficiency based on data from a $1.8 million physician profiling study by CRAHCA and the Robert Wood Johnson Foundation. Within two years, the MGMA hopes to add clinical outcomes comparisons, creating a system to measure every aspect of medical group operations.
The MGMA is late getting into the benchmarking game, which is rich with offerings from consulting firms, acknowledges CRAHCA Research Director Neill Piland. "But we feel there is room for improvement," he says. "There isn't a lot out there that is specifically tailored to group practices."
The group hopes to capitalize on its vast survey database on compensation, productivity and costs. One of the MGMA's major contributions will be enabling physicians to compare themselves on resource utilization, which deflates regional price differences posed by cost comparisons, Piland says.
"Frankly, a lot of our members want to come to us. They want to have confidence in the data," he says.
It could take a few years before many medical groups are feeling the pressure from payers that will force them to benchmark. Also, many lack the essentials to get started.
Data quality is a "huge problem" because most practices lack information systems that can collect clinical data, says Stephen Shortell, a professor of health services management and organizational behavior at Kellogg.
A second issue is size. Small groups will find it "difficult but not impossible" to aggregate sufficient data, Shortell says.
"I don't think we've yet identified a medical group that's doing a lot of fascinating benchmarking," says Shortell, who is participating in a study of medical groups affiliated with large health systems.
As an initial exercise, the MGMA culled its cost survey data to find 16 "better practices" -- multispecialty groups with high physician incomes and below-median costs (See chart). The data showed that better practices augment their staffs with more medical assistants, which probably increases patient contact and optimizes physician time.
But on-site visits revealed there was more to the story: All the practices have superior information systems, physician-administrator leadership teams, cost controls, budgets and working strategic plans.
"The (extra medical assistants) came along in the process of having a good strategic plan and a good budget," says David Gans, head of the MGMA's survey operations.