The Doctor’s dilemma: How to maintain a profitable practice?

Last week I commented on the role IT has in reducing healthcare costs and in particular how adopting web based appointments can provide doctors with an immediate ROI whereas other IT tools are viewed as long term investments. In doing more research on the financial stress placed on doctors as Medicare reimbursement decreases, I came across an essay by Dr. Sandeep Jauhar that I believe is particularly good at framing the issue of high healthcare costs from the doctor’s perspective. Dr. Jauhar, a cardiologist from Long Island, argues that patients undergo unnecessary tests and procedures because of a combination of pressure from patients wanting everything done for them and the need to counteract low Medicare reimbursement with increased volume. A pointed example is given where a cardiologist describes needing to perform 10 non-stress tests a month to break even. As a physician that was a difficult example to read because despite the reality of this doctor needing to run a profitable practice I cannot help but consider the implication that there are patients undergoing tests at the end of a month not because it’s medically indicated but because the doctor needs to break even for the month. My comments are not here to condemn doctors, we are doing the best we can to treat as many patients as possible within the confines of a complicated system that forces the healthcare provider into moral dilemmas. It does not take a rocket scientist (or neurosurgeon) to realize the easiest why for a doctor to maintain a profitable practice in the face of decreased reimbursement is to see more patients in clinic, order more tests and perform more surgeries.

To maintain profitability there is a heavy focus by doctors on maintaining their revenue and there has been little attention to decreasing the costs of running a medical or dental practice. The seeds for a transition to making health care more efficient are being planted by such organizations as the Institute for Health Care Improvement , a non-profit where one of their stated goals is to improve efficiency in health care. They provide doctors with tools to learn more about the inefficiencies in their practice. There are many suggestions for improving office workflow. One recommendation in particular is to match the supply and demand in an office practice. We believe web based scheduling is an IT tool that can be used to help private practices match supply and demand. When a practice uses web based appointments a doctor’s patient population can quickly and easily make appointments or change appointments in a way that matches supply with demand. If a doctor finds that on Friday afternoons he or she has low demand but on Wednesday morning demand exceeds supply, that doctor can place open appointment slots for Friday afternoons and encourage their patients to seek open appointment times. This type of system has the added benefit of preventing patient dissatisfaction on Wednesday mornings that inevitably occurs from long wait times. Implementing IT tools like SavvyDoc allows the doctor to maintain profitability, increase patient satisfaction and avoid the moral hazard described by Dr. Jauhar.

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One response to “The Doctor’s dilemma: How to maintain a profitable practice?

  1. Pingback: Subprime mortgage crisis affects Plastic Surgeons «

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