Reinventing Anesthesia Services
This is another of several responses to previous AnesthesiaReviews blog posts on why anesthesia groups fail. (This blog post was contributed by Tim Adams, MD, Managing Partner, Alabama Anesthesia of Huntsville, LLC.) This response might be better titled," Not all docs are meant to own small businesses."
"Anesthesia group practices are nothing more than small businesses in a service industry. Yet, for some reason anesthesiologists, perhaps more than any other type of physician, fail to recognize what ownership of a business entails. In order to be successful, business owners must think like business people do:
- Think strategically
- Plan for growth
- Accept responsibility for the survival of the business
- Continuously look for ways to make the business better and more profitable
- Recognize and pay attention to the group’s culture and human resource practices and take these seriously
Too often, partnership, and therefore ownership in an anesthesia business is awarded to any new doc who stays with the group for x number of years, irregardless of what the individual can contribute to the group's long-term success. Ownership becomes a right, and with that comes the sense of entitlement. Partnership is viewed more in terms of what it gets the individual – more money, a vote at the group meetings.
A more sound strategy for offering partnership would be to evaluate the individual’s ability to contribute to the business. These factors might include:
- Is the individual a good cultural fit?
- Is the individual capable of taking on administrative roles? Are they willing?
- Is the individual productive and energetic?
- Is the individual a whiner, or a problem solver?
In the recruiting phase, it is impossible for a group to know how a new doc will do. Rather than promising them partnership after x years, a more sound approach would be evaluate them on a periodic basis to determine if the recruit is worth retaining, and if they are worthy of ownership.
The failure of anesthesiologists to “think more like business owners” is the very reason that anesthesia management companies ("AMCs") and physician practice management companies ("PPMCs") have come on the scene. It’s not that AMCs and PPMCs are so good. Instead, we need to understand that many anesthesia groups underperform. Clinical performance is only 50% of the equation for success, if not less. Unless owners think and act like business owners, their organization is doomed.
Take Home Points:
- Anesthesia group practices are nothing more than small businesses in a service industry
- Partnership in a group should be awarded ability to contribute to the success of the group, not simply because of longevity
- Rather than promising them partnership after x years, a more sound approach would be evaluate them on a periodic basis to determine if the recruit is worth retaining, and if they are worthy of ownership.
- Local anesthesia groups can respond to AMCs and PPMCs