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The five biggest mistakes managers make - and how to avoid them.
It was nothing less than business-school savvy that put your practice back on firm financial footing. From the moment you accepted the job as office administrator, you set to work implementing strategies to reduce overhead costs, boost profit margins, and position the practice for sustainable growth. And one by one, your initiatives bore fruit. Why, then, are the physicians who hired you somewhat less than gushing in their praise of your managerial prowess?
Perhaps, says Kristen Dillon, a family physician for Columbia Gorge Family Medicine in Hood River, Ore., you’ve missed the forest for the trees. “One common pitfall I have seen among practice administrators is that they get too focused on the objective measures of business performance and lose focus on patient satisfaction or quality of care, which is harder to measure but just as important to the physician,” says Dillon.
Indeed, financial tunnel vision ranks among the top five mistakes that practice administrators make. At the end of the day, it’s the ability to juggle multiple business objectives that separates the wheat from the chaff. “We have a minimum standard for financial performance, of course, but once those milestones are met, it might be more important to us to do some projects that improve dental health in pediatric clinics, for example, or to implement management programs for diabetic patients, or get our medical assistants better trained,” Dillon says.
Another common and potentially costly flub committed by practice administrators is inattention to office inventory, says Stephen P. Makk, an orthopedic surgeon with an MBA for Louisville Bone and Joint Specialists in Louisville, Ky., and chair of the practice management committee for the American Academy of Orthopedic Surgeons. “A lot of people who sell supplies and durable medical equipment can be pushy, and they usually offer a discount rate when you buy in bulk,” he says. “But if you don’t watch the orders carefully, you’ll find your inventory piling up. It gets very expensive just storing it.” Makk recalls one office manager he worked with who inadvertently stockpiled $200,000 of an injectable drug for arthritis through routine deliveries that no one was monitoring. The stockpile was discovered only after her replacement did an inventory check.
Administrators who fail to maintain an appropriate staffing ratio also can take a toll on both office morale and the bottom line. Determining how many employees the practice needs and what type of skills they should have is a talent not all managers possess. “If you’re one or two people short, that’s a huge problem for the rest of the staff,” says Makk, noting overworked employees have higher turnover. “But if you have one or two people too many, that’s a huge hit to your overhead.” Those who cross-train staff to fill in for absent coworkers have the best luck doing more with less, says Makk. “You have to have some members of your staff flexible enough to cover for people where necessary,” he says. “In our case, we train our medical assistants to do some of those jobs when they’re not in surgery.”
Afraid to speak up
At the same time, administrators often make the mistake of being too timid when dealing with doctors. It’s easy to see why. While administrators have the responsibilities of a chief executive officer, they ultimately report to the physician shareholders, who have ideas of their own about staffing, budget management, and operating procedures. To ensure the office operates at peak performance, however, administrators must be able to assert themselves and (professionally) disagree with physicians when necessary. “You have to be able to manage up,” Dillon says. “Sometimes physicians meddle too much in the hiring and firing decisions, for example. You need to be able to tell them, ‘Look, you asked me to do this job, and if you want the practice to continue doing well, you have to give me the authority to do it.’”
Finally, of course, comes communication. No matter how finely tuned your leadership skills or how prestigious your degree, you won’t be successful on the job unless you can keep everyone in the office focused on a common goal: quality patient care. That means updating physicians immediately about personnel matters or financial concerns (both good and bad) and keeping the business staff apprised of the physicians’ goals. It does not mean inundating the doctors with every detail. “This is one of the most critical pieces of the administrator’s job,” says Makk. “As physicians, we don’t have time to do our job and run the office as well, or worry about who is fighting with whom this week. The administrator needs to be able to set policies and communicate effectively so when something is not working, they know about it right away.”
Shelly K. Schwartz is a freelance writer in Maplewood, N.J., who has covered personal finance, technology, and healthcare for 12 years. Her work has appeared on CNNMoney.com, and Bankrate.com, and in Healthy Family magazine. She can be reached via firstname.lastname@example.org.
This article originally appeared in the June 2007 issue of Physicians Practice.