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Where has all the money gone? Who knows where the time goes?

Medical Staff Affairs Monthly, January 9, 2008

In last month's column-"Going, going, gone . . . "- the predicted demise of generalist physicians in adult medicine, general surgery, pediatric medicine, and obstetrics was addressed. Why is this all occurring? The answers are multifactorial and often complex; however, most experts keep coming back to two fundamental issues: money and time. Because of the importance of these two key components, they will be probed in greater depth this month.

Where has all the money gone?

A ballad made famous by the Kingston Trio asked, "Where have all the flowers gone?" Medical students are smart and are asking, "Where has all the money gone?" They know that primary care physicians and generalists earn less money, work longer hours, and bear undue professional liability risks. Multiple surveys show specialist compensation that is two to three times that of generalists. For a medical student graduating with an average of $130,000 to 160,000 in debt, the choice is not difficult. This is combined with a marked shift from the profession of medicine to the business of medicine and what it means to be a doctor. Under this new scenario, the emphasis is on carving out and protecting a job as opposed to necessarily serving the community. Arnold Relman addresses this issue eloquently in a December 12, 2007, JAMA editorial, "Medical Professionalism in a Commercialized Health Care Market."

A more cogent question is why the increasing disparity between generalist and specialist compensation? Wasn't resource-based relative value scale designed to save the generalist base in medicine by recognizing the value of cognitive services and accounting for the higher overhead in generalist practices? The answer for this can be found in another financial crisis, namely sub-prime mortgage rates. In a recent Wall Street Journal article about this topic, the reader was reminded that policies designed to suspend the laws of economics inevitably produce unintended consequences. Follow that general economic observation with the outstanding analysis of the RBRVS system by John Goodson in the November 21, 2007, JAMA ("Unintended Consequences of Resource-Based Relative Value Scale Reimbursement"), and you begin to see that we have an unhealthy prognosis for the financial survival of physicians in generalist care.

Who knows where the time goes?

This question was asked by Judy Collins in a 1970s folk song. A unique situation exists in healthcare today in which four generations are simultaneously practicing. These are the Greatest Generation, baby boomers, Generation X and Generation Y. Much has been written about this subject, and there is much evidence to support that Generation X and Generation Y are seeking a life-work balance. It's as much about money as it is about time, lifestyle, and quality of life. More and more physicians are falling into one of three groups:
1. Entrepreneurs who will continue to seek alternative sources of income (usually from the hospital)
2. Security seekers looking for employment, predictable work shifts, and financial security
3. Academics supported by grants for research and teaching

Now what?

The medical staff is one of the most critically important assets of any healthcare organization. A major strategic initiative for hospitals becomes the development and structure of their medical staff. The recruitment and retention of physicians becomes a major board-driven strategy that will require new and different approaches going forward. There is not a one-size-fits-all answer, and new models and experiments are seen across the  including a self-governed medical staff with fewer but more committed physicians, physician employment, physician executives and managers, service line management, contracts, physician-hospital compacts, intended practice plan, invitation only, and other models not yet defined or widely recognized.

In addition, the medical staff development plan must evolve beyond the old model of demographics + staff roster + aging analysis = physician recruitment plan. The new medical staff development planning model is driven by the 7 Rs:
1. Right number
2. Right type of physicians
3. Right quality
4. Right relationship to hospitals
5. Right culture
6. Right structure and processes
7. Right leadership

A series outlining this new model is planned for Medical Staff Briefing in 2008. The Greeley Company has long provided practical strategies to many organizations facing these challenges. Let us know if we can be of help. Until next time, be the best that you can be.

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