If you live in the northeastern part of the country, you've probably noticed the leaves falling outside your office window. This should be your cue to start reflecting on how your practice has prospered or faltered this past year and begin planning new directions for the coming year.
Seasoned practice owners and administrators know the importance of setting practice goals, both short and long term. In today's turbulent economy, having a roadmap is even more important. So as you prepare to chart the direction of your practice in 2011, here are a few steps to consider:
End-of-year planning involves assessing your practice's successes and failures over the last year. However, many of the practices I work with do not have a set of written practice goals. In my mind, that is one of the biggest mistakes that practice owners and administrators can make. To assess your progress for the year, you must have a metric against which to measure your practice. Written goals are an effective way to do this. They also help your practice stay on track throughout the year. Ask yourself, "Have I accomplished all of my goals for the year?" And if not, "How can I do better?"
A serious look at the health of your practice should include reviewing practice demographics such as: the age and number of your physicians; your practice's financial stability and revenue trends over the past couple of years; and competition in your local community, state, and geographic region; and other applicable metrics. Look at these factors together and ask yourself, "What will have the biggest impact on the future of my practice?"
2. Change management
Next, ask yourself, "What recent or brewing changes, such as, say, ICD-10 preparation, will directly impact my practice next year?" Obviously this year’s big news is healthcare reform. It's impossible to predict exactly how things will unfold in the near future; however, there are certain changes on the horizon that will affect your practice whether or not healthcare reform is vetoed or delayed in implementation. Bundled payments as opposed to fee-for-service reimbursement, pay-for-performance reporting, and meaningful use dictates are all looming for medical practices and are certain to affect how you run your daily operations.
You should spend time reviewing the recent changes in the law and also listen to opinion leaders in your medical specialty to make sure you are prepared. Fortunately, the coming year will bring few direct changes for your practice, but you should start preparing now for changes in 2012 and beyond.
One way of preparing your practice is to set up a planning retreat — gather all key individuals in your practice offsite to spend a day or even an entire weekend strategizing about future directions for your practice. A SWOT (strengths, weaknesses, opportunities, threats) review is always a great place to start. Once you have outlined your strengths and weaknesses, your senior team can discuss the direction and goals your practice will establish for the next year.
Another option is to hold a brief planning session during every board meeting throughout the upcoming year. This method is not as focused as a planning retreat, but may still help you create and implement practice goals for the year.
4. Future scenarios
Another planning alternative, especially in the face of the uncertainty regarding healthcare reform, is to develop several potential scenarios for your practice. Then your senior team can create a plan of action for each of those scenarios. For example, you may identify four different outcomes — based on your practice and market — such as selling your practice to the local hospital system, merging with an existing group practice, taking the lead and forming your own group practice, or staying the current course. Once your scenarios are identified, you can then review what steps would be necessary to follow each path. No action is taken until market forces evolve to the point that one of the scenarios emerges as the most advantageous for your practice. You will already be ahead of the game, having thought through the initial phases of moving forward.
However you decide to plan for the coming year, the key point is don't delay, now is the time to start. This is often the most difficult process in any business, yet it can be the most important one for the success of your practice.
Owen Dahl, FACHE, CHBC, is a nationally recognized medical practice management consultant and author of “Think Business! Medical Practice Quality, Efficiency, Profits,” “The Medical Practice Disaster Planning Workbook,” and coauthor of “Lean Six Sigma for the Medical Practice: Improving Profitability by Improving Processes.” He can be reached at [email protected].