A few books, a mentor and a clear sense of purpose can help forge a practice’s path to success
Most ophthalmologists focus on the sciences during their 4 to 5 years of college education and then are immersed in a very challenging medical school environment for 4 more years, with minimal to no formal training in business or practice management. This is repeated during their 1 year of internship and 3 years of residency. Those who perform a fellowship in a well-managed private practice environment have the opportunity to learn some business and practice management skills, but enhancing clinical and surgical skills remains the top priority.
Fortunately, most young ophthalmologists today join one or another group practice, so great depth in business and practice management is not initially required and can be developed over the years for those interested in pursuing leadership positions in their chosen organizations. Every organization providing medical care or producing medical products in today’s complex health care environment demands input from MDs with business, practice management and leadership skills to prosper. A great way to develop these skills today is to pursue an MBA, as discussed in the accompanying cover story, but many of us who completed training 30 or 40 years ago were forced to learn how to manage and lead a practice the hard way — in the so-called “school of hard knocks,” in the trenches. Such was the case for me, and not every young ophthalmologist of today who aspires to a leadership position in ophthalmology has the time or the temperament to pursue an MBA after completing 12 to 14 years of post-high school education. So, some thoughts from a grizzled veteran.
There are a few books I have personally found extremely helpful. These include Good to Great and Built to Last by Jim Collins, Traction by Gino Wickman and Get a Grip by Mike Paton. The books written by ophthalmology practice consultant John B. Pinto and published by the American Society of Ophthalmic Administrators are also excellent, especially the classic Little Green Book of Ophthalmology. For the really motivated, learn about High Performance Management Systems, although this usually requires a consultant for successful implementation. If interested, contact Bernie Haffey at 2020 Management Consulting. For the young ophthalmologist motivated to lead and manage, buy these books and read them carefully, making notes and going back and reading them again and again after completing them all.
Second, find a mentor. In the business world, this is easier with many organizations available to pair young aspiring business leaders with senior mentors. Organizations such as the Young Presidents’ Organization (YPO) specialize in creating the next generation of America’s business leaders. Unfortunately, organizations such as YPO are not available in medicine. Here is hoping some entrepreneur will create them, as they are sorely needed. Still, the young ophthalmologist with a little initiative and persistence can usually find someone experienced to mentor them.
Third, when attending meetings such as American Society of Cataract and Refractive Surgery, American Academy of Ophthalmology and Hawaiian Eye, participate in some of the business meetings designed for practice administrators rather than just clinical update sessions. The American Society of Ophthalmic Administrators of the ASCRS and the American Academy of Ophthalmic Executives of the AAO present excellent educational opportunities that are open to doctors. Join Ophthalmic World Leaders and network and learn from a diverse and distinguished group of colleagues.
Finally, engage a high-quality set of advisers, including a trusted accountant, lawyer, financial planner, practice management consultant (such as John Pinto or Bruce Maller at BSM Consulting) and, of course, reimbursement consultant. We use Corcoran Consulting Group.
Now, a few of my guiding principles gleaned from a decade in academics, running a cornea service and serving as chief of ophthalmology at a large VA hospital founded 28 years ago, helping build a large private practice, Minnesota Eye Consultants, creating a successful consulting practice including serving on many boards of directors and medical advisory boards, and serving as chairman and CEO of my family’s construction business, Lindstrom Restoration.
First, determine what you believe you can excel at and are passionate about. Then, create a vision to aspire to be the best in class in that endeavor. For Minnesota Eye Consultants (MEC), my vision in 1989 was to build “the best academic private practice in the world.” This would be called a “BHAG” by Jim Collins, or a “big hairy audacious goal,” but it is necessary to aim high and aspire to greatness to reach your highest potential. Satisfaction with good is the major enemy of great. The mission, according to Jim Collins, should be “built to last” and must be driven by more than just monetary goals and generating high profits. The MEC mission is “to preserve, restore and enhance vision through research, teaching and providing the highest quality medical and surgical care to patients.”
Then, develop a set of core values. It is necessary to write this down and review and revise it at least yearly. We have even placed a summary of our mission and core values on our website.
Of course, revenue generation is critical to every practice. It is important to know how revenue is generated and which activities are most productive. There are many metrics to follow, including revenue per clinic patient broken out by visit type and presenting diagnosis; revenue per surgical case, again broken out by procedure type; revenue per doctor day; revenue per doctor hour broken out by activity; revenue per full-time employee; percent new patients; total visits; total revenue; compound annual growth rate; and total EBITDA before partner distribution, among others. In addition, we monitor patient satisfaction, employee satisfaction and partner/shareholder satisfaction, as taught in the High Performance Management Systems (HPMS). HPMS also teaches the discipline to focus on the “vital few” critical imperatives that really matter to an organization’s success and must be achieved to avoid failure and not get caught up in the countless irrelevant urgencies that present in a complex practice every day. A simple one-page “dashboard” can be created that reminds everyone of the organization’s vision, mission and core values and allows one to follow the “vital few” metrics year by year, month by month, or even week by week or day by day.
The overall eye care market is growing at about 4% per year. If you are not growing at this rate, you are really shrinking in market share. Our goal at MEC is to grow at 8% to 12% per year. That requires the addition of a partner-track surgeon at least every other year and a medical ophthalmologist or optometrist at a similar frequency. To grow at this rate requires strong leadership, discipline and significant capital. Minnesota Eye Consultants recently partnered with a private equity firm, Waud Capital of Chicago, to form a jointly owned entity, United Vision Partners, which will strengthen our balance sheet and capital structure without resorting to significant personally guaranteed partner bank debt, a limiting factor in our growth. At MEC, we have 11 ophthalmologist partners who range in age from 34 years to 69 years and very experienced and professional senior management. We are blessed with seasoned leadership. Still, we consider it critically important to develop the next generation of physicians and lay leaders and invest heavily in that priority. Currently we have one mid-career partner with a master’s degree in public health. Several others, including myself, have taken advantage of so-called mini-MBAs available at many prestigious business schools including Harvard, which I attended.
To survive and thrive in today’s challenging health care environment requires ophthalmologists to make good business decisions. While our vision and mission at Minnesota Eye Consultants are silent in regards to revenue production and profitability, we all realize we cannot pursue our core purpose without disciplined attention to our financial performance. Yet, it is not our core purpose as we pursue our vision and mission into our fourth generation of group practice. I hope my colleagues find a few of these thoughts and examples useful as we together face an ever more challenging external practice environment.