Effective Decision-Making Essential for Physician Practices in Fast-Changing Healthcare Landscape

It’s a safe bet that operating a physician practice has never been more complicated or challenging. From shifting reimbursement models and new regulatory mandates to the expanding role of technology and evolving provider relationships, today’s fast-changing environment demands clear thinking and incisive, informed responses.

Unfortunately, the sheer volume of issues facing most practices can quickly overwhelm even the largest organizations. Pressed for time, grappling with a range of complex, high-stakes questions and often compelled to achieve partner unanimity before action is taken, practices may find themselves struggling to keep pace as critical issues continue to snowball.

The resulting `decision coma’ can leave physicians all but paralyzed in the face of questions that may have a significant, long-term impact on their practice. Alternatively, they may be vulnerable to ill-conceived, snap judgments. To avoid these pitfalls, practices should periodically assess their governance effectiveness to ensure they’ve created a process capable of consistently producing knowledgeable, sound, and timely choices.

Embrace the matrix

A decision matrix that delegates the due diligence and research required to reach informed recommendations is a good place to start. Although the democratic impulse to include all partners in every decision is understandable, this is seldom practical unless the group is small, with perhaps four or fewer physicians. Middle-sized to large practices typically are better served by creating a board of directors and, within the board, an executive committee.

The board, in turn, can assign prioritized questions to smaller, subject-matter-specific subcommittees. Subcommittee oversight mandates can include personnel, finance and benefits; quality assurance and clinical; hospital relations and growth; and billing, compliance, and payer relations. Small groups likewise can establish similar divisions of labor by assigning specific areas of responsibility across the membership.

Regardless of the group’s size, the objective is for the smaller working unit to bring informed recommendations to the board and/or group for a decision. In larger practices, the board can put the issue to a vote among all partners if the matter is deemed important enough to require input from the entire organization.

Whether votes are taken at the subcommittee, board or organizational level, practices should generally avoid the trap of seeking unanimous approval. There are exceptions, of course, where unanimity is valid and necessary. But generally speaking, super majorities of 67% or even 75% are more than adequate to achieve consensus while improving the odds a timely decision will be reached.

Building trust

Creating working subcommittees spreads the heavy lifting needed to assess the merits of particular issue across a wider pool of physicians. In so doing, it helps develop expertise on specific topics throughout the organization. Additionally, delegating through a decision matrix implicitly conveys a sense of trust in the capabilities of the less-senior partners and employed physicians. This contributes to a legitimate feeling of ownership throughout the organization and, assuming recommendations are acted upon more often than not, helps engender reciprocal levels of trust for organizational leadership among staff and junior partners.

Cornerstones of sound decisions

With a framework in place to efficiently delegate the groundwork needed to uncover baseline information for sound decisions, it is useful to continually ask a series of simple questions that can keep the decision-making process on track and help ensure consistent and cogent responses.

• Are we prioritizing effectively? Given limitations on time and personnel, it is vital to focus on issues that will have the most significant impact on the business. Similarly, it is important that these priorities align with the organization’s goals.
• Is the process efficient? Work to isolate the core question, develop the necessary information to assess the optimal course, and then push for closure.
• Is it timely? With deadlines always pressing and new issues inevitably bubbling up, it is critical that the process for arriving at a decision move forward promptly. This is particularly important when the decision involves a response to a third-party request or requirement, such as a contract or request for proposal.
• Are our decisions effective? Is your process producing sound, logical and goal-aligned judgments? If the answer is no, reverse engineer how the decision or decisions were made to fully understand where and why the process went off the tracks.
• Is the decision financially sound? Since nearly every decision has financial implications, it is critical to carefully assess both near- and longer-term fiscal impacts, while also developing worse-case scenarios should events not unfold as anticipated.
• Are we being thorough? Think through the secondary and tertiary ramifications of a decision to avoid unintended outcomes. Part of this process involves examining the political implications of a decision. For example, opening a new facility may make financial sense, but will it upset your hospital partner and potentially jeopardize your contract? Similarly, don’t overlook the cultural impact of a decision. As an example, if a decision is made to allow 15-year-plus veterans to go part-time, what effect will this have on younger physicians still required to work full-time and cover additional call?

The role of leadership

To a great extent, a group’s decision-making process ultimately will reflect the attitudes of the organization’s leadership. In some practices, it isn’t unusual for the president or senior staff to take charge of all critical issues and essentially impose their beliefs on the group with minimal input from others. Not only can this approach create a sense of frustration and disenfranchisement among non-leadership personnel, it also offers few opportunities for groups to develop a new generation of leadership internally.

Of course, some physicians may welcome not having to play a significant role in organizational decisions, given their day-to-day workloads. Yet concentrating too much power in the hands of one or two executives inevitably will backfire if leadership decides to leave or is otherwise removed.

Every practice obviously is unique, given differences in specialty, size, culture, leadership, and a host of other variables. As such, the decision-making process for a 10-physician radiology group will (and should) look different than that of a 40-physician anesthesiology group.

Nonetheless, similar cornerstones underlie solid decisions regardless of the type or size of an organization. Building a culture of sound decision-making while developing leadership bench-strength within the practice represents an investment of both time and resources. Some practices rely on outside partners who can help perform assessments, set up committees, or help define organizational structures to lay the foundation for future decision-making processes. Either way, it is a process that will pay big dividends as organizations continue push forward into a complex and uncertain future.