There are approximately 200,000 medical practices in the U.S., and almost all the physicians in those practices are certified by their relevant medical specialty boards. Yet a relatively small proportion of those practices have board-certified practice administrators managing their business and clinical operations.
Over the past 30 years, medical-specialty board certification has almost become a necessity for physicians to practice their profession. Most health plans require board certification or board eligibility as a prerequisite for participation in health insurance programs. Similarly, it is very difficult for a physician who is not board-certified to gain admitting privileges in the vast majority of the nation's hospitals.
Why is it, then, that so many physicians who would never consider referring a patient to a specialist who isn't board-certified are content with turning over the operation of their businesses to individuals who aren't certified in medical group practice management?
As medical groups have expanded in size and complexity over the past several decades, the need for skilled, board-certified practice administrators has grown. And as hospitals and health systems interact with those practices, not only as members of their medical staff but increasingly through joint ventures, acquisitions and management contracts, the need to understand the differences between hospital management and medical practice management has also increased.
Medical groups must contend with overwhelming administrative complexity and regulation with the end goal of providing a safe, satisfying patient experience and making a profit for their owners. Many hospital and health system leaders have learned painful lessons about medical practice management. During the practice-acquisition fad of the 1990s, numerous skilled hospital administrators found that their hospital experience did not translate well to managing one or more medical practices. Medical Group Management Association survey data from 2000 showed that hospital-owned practices were operating at a median loss of almost $90,000 per physician. That number speaks volumes about some of the misconceptions many hospitals had about managing medical groups.
Unfortunately, many physicians, as well as hospitals that own and manage physician practices, still cling to the outdated notion that managing a medical practice is a simple job that can be done by anyone with a general business (or healthcare) background. Not so. Medical group practices today are often multimillion-dollar organizations, employing scores or hundreds of health professionals and support staff, housing sophisticated technology, and dealing with an extremely complex array of insurance programs and government regulations.
Practices are being squeezed from all directions. Financially, Medicare cuts threaten not only the livelihood of physicians but also access to care for some of the neediest patients. Pay-for-performance, new information technology and consumer-directed health plans are only a handful of the newer issues facing group practice administrators.
Of equal or greater concern, MGMA data show that practice revenues have not grown as fast as practice expenses over the past 10 years. As a consequence, physician income has barely kept up with inflation, and income for primary-care specialties has actually lagged behind. All of this evidence leads to a simple conclusion: Running a medical group today demands well-educated, experienced practice-management professionals.
Some of the core knowledge and skills needed for succeeding in hospital management and medical practice management are the same. The Health Leadership Alliance, which includes the MGMA and several other leading associations, recently released its comprehensive healthcare management Competency Directory, the culmination of a two-year effort to inventory both core managerial competencies and specialized competencies needed for specific jobs or types of organizations (Sept. 12, p. 6). Although that document shows significant overlap in facets of healthcare management, it also dramatically demonstrates the depth and breadth of the many highly specialized competencies needed to manage a medical group.
The MGMA's certification body, the American College of Medical Practice Executives, is the oldest recognized national board-certification and fellowship program in the country for medical practice administrators. The ACMPE certification process is based on a well-delineated body of knowledge that must be mastered in order to be a successful practice administrator. That body of knowledge was defined through extensive job analyses of medical group practice leaders and reflects both content and the specific technical and interpersonal skills that must be mastered to perform effectively. (The full body of knowledge can be accessed at www.mgma.com/acmpe/bokguide.cfm.) To date, ACMPE has granted current certification or fellowship to more than 2,100 medical practice executives. And MGMA survey data show that practices managed by a certified practice executive are significantly more profitable than the average.
If you're currently a practice manager who is not board-certified, consider taking the next step -- it could be critical to your future career. And if you're a hospital or health system leader looking for executive staff for one or more medical groups, look for a board-certified medical practice executive. It could be a smart career move for you as well.
William Jessee is president and chief executive officer of the Medical Group Management Association, Englewood, Colo.