Creating an elective in business of medicine

[SugPlum]

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I'm thinking about trying to start a new elective for fourth year med students at my school in the business side of medicine. From reading posts in this forum and my experience in working with physicians, it seems that physicians get limited exposure to business. I'm thinking about an elective with students shadowing in hospital billing, medical practice billing and other management, human resources, and health insurance companies. Students wouldn't be doing actual work, but learning about how it all works. I remember that Columbia had an elective that was an internship at a health insurance company, but that was a long time ago. I figure that fourth year students have an idea of which specialty they are interested so they will be able to tailor the elective, e.g. learning about surgical office billing if someone wants to pursue surgery. How popular do you think such an elective will be?

 

[Hurricane95]

I think that would be a great idea for people interested in private practice.
Our school just recently started up a joint 5 year-MD/MBA program together with the business school, which I am participating in. I think lots of people would be interested in doing a 4th year elective, since some people are reluctant to do a full extra year and that I know of no schools have an elective like this. Go for it 👍

 

[Law2Doc]

I'm thinking about trying to start a new elective for fourth year med students at my school in the business side of medicine. From reading posts in this forum and my experience in working with physicians, it seems that physicians get limited exposure to business. I'm thinking about an elective with students shadowing in hospital billing, medical practice billing and other management, human resources, and health insurance companies. Students wouldn't be doing actual work, but learning about how it all works. I remember that Columbia had an elective that was an internship at a health insurance company, but that was a long time ago. I figure that fourth year students have an idea of which specialty they are interested so they will be able to tailor the elective, e.g. learning about surgical office billing if someone wants to pursue surgery. How popular do you think such an elective will be?

I think you miss the mark if you focus on institutional business (hospitals, insurance companies), and not on small businesses. The vast majority of physicians who find themselves missing fundamental business knowledge are going to be in small practices and partnerships. Nobody needs to know how hospital billing and HR works, because a mere fraction of a percent is ever going to work in such an organization. It needn't be specialty oriented, it should be small business oriented -- meaning it really should be taught by a lawyer, accountant or perhaps an experienced entrepreneur.

 

[SugPlum]

I think you miss the mark if you focus on institutional business (hospitals, insurance companies), and not on small businesses. The vast majority of physicians who find themselves missing fundamental business knowledge are going to be in small practices and partnerships. Nobody needs to know how hospital billing and HR works, because a mere fraction of a percent is ever going to work in such an organization. It needn't be specialty oriented, it should be small business oriented -- meaning it really should be taught by a lawyer, accountant or perhaps an experienced entrepreneur.

I was thinking of something more hands-on and less lecture based using resources already available within the hospital and physicians' group affiliated with my med school for students to learn what physicians' administrative office staff would be doing and some business aspects that some physicians learn on the job in a small practice. My institution also has a business school. It would have to have minimal cost to my school because of the current status of the economy.

I wonder how feasible it would be for students to run a practice on paper under the guidance of medical and business faculty. This would like a stock market game, but it would involve contact with other individuals for information. For instance, a student may go talk to a bank about getting a loan to start a practice or finance equipment as a part of the exercise. This idea is based on my high school's Applied Economics class, where students would assume roles as college graduates with new jobs and shop for cars, look into buying real estate, etc. by contacting car dealers, real estate agents, bank loan offices, etc.

 

[Law2Doc]

I was thinking of something more hands-on and less lecture based using resources already available within the hospital and physicians' group affiliated with my med school for students to learn what physicians' administrative office staff would be doing and some business aspects that some physicians learn on the job in a small practice. My institution also has a business school. It would have to have minimal cost to my school because of the current status of the economy.

I wonder how feasible it would be for students to run a practice on paper under the guidance of medical and business faculty. This would like a stock market game, but it would involve contact with other individuals for information. For instance, a student may go talk to a bank about getting a loan to start a practice or finance equipment as a part of the exercise. This idea is based on my high school's Applied Economics class, where students would assume roles as college graduates with new jobs and shop for cars, look into buying real estate, etc. by contacting car dealers, real estate agents, bank loan offices, etc.

Yeah, even before you said it, it sounded very like a high school project. I'd say take all "hospital" aspects out of it -- I know the resources are easy to access, but again, they are not where the value of such a course would be. The necessary knowledge can only be gleaned from a focus on small business. Things like getting bank loans aren't particularly the issue either --you need to focus on things like a business plan, and entity structure, the typical balance sheet type revenues and expenses, employee management, small market marketing, contracts and daily legal/liability issues, small scale billing, collections (very different than institutional), insurance filings and reimbursements, and taxes (business and employee related). The things people get hung up on, or where doctors tend to be really naive and shortsighted. It simply won't matter to you in practice how a hospital does things -- those administrators will generally have an MBA or JD and not have need for a med school business course. While running a mock business may be "fun", it's simply more effective to teach the major concepts in a classroom setting first, IMHO.

 

[SugPlum]

Law2Doc,

I am thinking of a cost-effective way (for my school) to let the students get their feet wet. What I am thinking of does not replace a MBA program or even anything like the certificate program at Johns Hopkins. I really doubt that the med school would be able to get the business school at my institution to schedule extra lectures for med students. I think that it would be easier for med students to audit relevant business school courses as time permits during 4th year.

 

[Law2Doc]

Law2Doc,

I am thinking of a cost-effective way (for my school) to let the students get their feet wet. What I am thinking of does not replace a MBA program or even anything like the certificate program at Johns Hopkins. I really doubt that the med school would be able to get the business school at my institution to schedule extra lectures for med students. I think that it would be easier for med students to audit relevant business school courses as time permits during 4th year.

Um, what I'm suggesting isn't taught in any MBA program and wouldn't be as in depth as a business degree or certificate. Most business schools require people to have worked first before applying precisely so that they don't have to teach the kind of very basic stuff I'm describing. So med students auditing MBA courses is wasteful and off topic. You have to realize that MBA programs don't teach people basic business skills, they enhance the skills of people who already have some.

What would be ideal is to arrange for a series of lectures by successful solo practitioners (alumni?) to discuss various topics, with perhaps a lecture or two from a business lawyer/accountant/ business school prof thrown in.

 

[Non-TradTulsa]

Going into the field and getting your "feet wet" might be fascinating, but it won't help much.

One problem that I know of from 20 years as a masters-level CPA and healthcare executive is that physicians tend to grossly underestimate the complexity of healthcare administration and finance. A couple of business-oriented courses aren't going to get anyone ready to run a hospital - or a private practice. And while an MD/MBA is great training if you want to climb the ladder in administration - in my opinion (after half a lifetime of doing this), an MBA degree only qualifies you to go out and get experience in the business world. With no experience, an MBA is a rather weak qualification.

If I were going to teach a course for medical students or residents, I would focus on teaching the class some basic "facts of life." So many doctors I run into get into a rage over decisions made by a hospital or a group medical practice - and, when I talk to them further, it's because they really don't understand how the system works at all. I'd teach future doctors what makes money in a hospital and what doesn't. I'd teach them the difference between per-diem payments and case-based payments. I'd teach them about different reimbursement methods that affect physician reimbursement and physician contracting.

As a student or a young physician, you might want to be taught all the details about coding, billing, and reimbursement because you don't want to "feel helpless" and you "don't want to depend on anyone else" (I used to hear that a lot, too). I wouldn't attempt to teach that - it took me 20 years working full-time in healthcare administration to become an expert, and I couldn't teach it in one or two courses. Just doesn't work that way. Clinical medicine and healthcare administration are two totally separate career disciplines. I would simply try to teach physicians enough so that they might be able to develop relationships with more trust with the administrators and practice managers that - in the end - doctors have to depend apon.

 

[Law2Doc]

Going into the field and getting your "feet wet" might be fascinating, but it won't help much.

One problem that I know of from 20 years as a masters-level CPA and healthcare executive is that physicians tend to grossly underestimate the complexity of healthcare administration and finance. A couple of business-oriented courses aren't going to get anyone ready to run a hospital - or a private practice. And while an MD/MBA is great training if you want to climb the ladder in administration - in my opinion (after half a lifetime of doing this), an MBA degree only qualifies you to go out and get experience in the business world. With no experience, an MBA is a rather weak qualification.

If I were going to teach a course for medical students or residents, I would focus on teaching the class some basic "facts of life." So many doctors I run into get into a rage over decisions made by a hospital or a group medical practice - and, when I talk to them further, it's because they really don't understand how the system works at all. I'd teach future doctors what makes money in a hospital and what doesn't. I'd teach them the difference between per-diem payments and case-based payments. I'd teach them about different reimbursement methods that affect physician reimbursement and physician contracting.

As a student or a young physician, you might want to be taught all the details about coding, billing, and reimbursement because you don't want to "feel helpless" and you "don't want to depend on anyone else" (I used to hear that a lot, too). I wouldn't attempt to teach that - it took me 20 years working full-time in healthcare administration to become an expert, and I couldn't teach it in one or two courses. Just doesn't work that way. Clinical medicine and healthcare administration are two totally separate career disciplines. I would simply try to teach physicians enough so that they might be able to develop relationships with more trust with the administrators and practice managers that - in the end - doctors have to depend apon.

I still think the issue of business naivete in physicians in most often demonstrated when they go out into small private practice. Most won't delve into the world of administrative or institutional business, they will join XYZ small partnership. And because so many are bio majors who never took a law, business or accounting course, and never held a job other than lab tech or EMT, they lack even the most basic of knowledge as to how a business works, what you need to do to run it, the costs involved, what kind of paperwork is involved, and most importantly, when they are over their head and need to involve a lawyer or accountant. Most are already in trouble when they finish residency and sign a partnership agreement, which they very likely won't understand and quite often ends up a bad deal for them as a result. Too many sign bad contracts with vendors and suppliers after that, underestimate how quickly they will be reimbursed from insurance, or how long it takes to complete paperwork, or what kind of employee obligations they have with respect to their PA, receptionist, nurse and tech. Most are skilled at doing X, but find that they royally screw up everything every instant they have to do office administrative or financial or tax stuff. As a result, in my prior career, I dealt with many many physicians who bankrupted their practices. Bad management, overuse of credit, runaway expenses, mishandling of employee payroll taxes. Happens a lot, and virtually all of it could have been avoided with some basic business knowledge, or at least some sense of knowing when they didn't know what they were doing and that it was time to call in an ancillary professional (lawyer or accountant) for advice.

A series of lectures by folks in practice would go a long way in opening people's eyes as to what's involved. Stay out of the hospital administration/institutional stuff. The 1-2 people in your program who go that route will get that experience when they get the MBA/JD/CPA they will likely need to land such a path. For the rest, they really need to learn to recognize when you are in over your head, because that's the first step. Nothing taught in an MBA program is that important here, for the reasons I and the above poster mentioned. We are talking basics. But making it a game of trying to run a practice, like you might in high school, misses the point from the other extreme IMHO.

 

[Non-TradTulsa]

You bring up some great points. But, here's an example of what I mean by needing to educate new doctors in basic facts.

The new residency grad who decides to go solo probably doesn't understand that, in the primary care disciplines, revenue from E&M codes is not nearly enough to support current salaries - not unless you're seeing 40-60 patients a day. That's why nearly everyone's now in a group practice, where the difference is made up in one of two ways: 1) the practice is owned by a hospital who is willing to subsidize primary care salaries in exchange for keeping beds filled from employed referral sources, or 2) the practice is a multi-specialty practice and is large enough to capture additional revenue from fees on in-house lab, X-ray, etc. Ancillary services carry a good mark-up even on Medicare reimbursement - which was done because Medicare knows full well that you can't support a practice on E&M codes alone.

Simple stuff. But I bet not many new grads understand these business realities.