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Does your practice need a consultant?
Research, specific goals are needed before hiring a consultant.
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Whenever doctors from different practices congregate, the discussion inevitably turns toward the respective successes and failures of their practices. Even the most confident doctor leaves these discussions with the burning question: Why is my practice not as good as his?
My first response to any doctor would be, “He lies better than you.” Despite that, it is likely that another practice does some things better than yours, simply because the doctors and managers there have different talents and interests than you and your managers. These discussions invariably lead to a new quest to fix your practice’s shortcomings.
If your doctors are committed to continuous improvement, at some point someone in your practice will utter the dreaded phrase: “We need to hire a consultant.” In the past 10 years, our practice has hired consultants for the areas of practice management, marketing, billing and coding, optical, fraud reviews, benefit plan development and mergers. This article explores which practices need consultants, how they should be selected and how a practice can derive the optimal benefit from a consultant’s work.
Who needs them?
The most likely reason to turn to a consultant is that he or she brings a level of expertise or manpower that the practice does not have within its ranks. On several occasions, our practice has had a group of interrelated questions or potential solutions for which we needed solid guidance, and in most cases our consultants have helped us fill in our information gaps. Consultants may also be crucial in turnaround or growth situations where the practice needs an objective eye and advice from someone who has seen other practices succeed and fail in the same circumstances. In addition, in the new era of Medicare audits and Health Insurance Portability and Accountability Act deadlines, consultants can offer external pressure to keep practices on the straight and narrow.
Does every practice with a problem on its hands need a consultant? Certainly not. John Pinto, an ophthalmology practice management and strategic consultant, sees many situations where practices are too quick to call for a consultant. Mr. Pinto said, “It would be helpful if practice boards would accord their administrators the respect they give consultants, and listen to their ideas a little more closely.” However, it is also up to the administrator and other senior managers to assume the role of internal consultant, objectively evaluating problems and providing concrete solutions.
How do you select them?
In many ways, finding the right consultant is similar to selecting the best phaco machine or nerve fiber analyzer. You research the available options, call your colleagues and ask for their recommendations, and listen to presentations at conferences. Perhaps you even tolerate a few sales pitches. Once you have gathered all the information, you sort out hype from reality.
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Hype is a concern because becoming a consultant is as easy as ordering a box of business cards. For example, I know a muddling consultant just 3 years out of college who launched her own business because the stress of managing a practice was making her ill. There are good and bad consultants, and an engaged physician is smart enough to discern the difference.
If you already have a successful relationship with a consultant, she may be an excellent resource for finding a consultant with a different specialty. After all, your incumbent consultant’s reputation and long-term position with your practice is at stake, so she is not likely to give you a half-hearted recommendation. While it may seem wasteful to have an ongoing relationship with more than one consultant, we have found that this allows us to use exactly the right resources for the problem at hand. For example, while we value our practice management consultant’s viewpoints on long-term strategy, we know (and he knows) that he would be a poor selection for a coding review.
A key decision point is to determine the stature of the consultant you need. A national consultant may be more respected but will also be more expensive (up to $4,000 per day with expenses). A consultant from a local CPA firm may be priced more reasonably but may not have the respect or expertise to accomplish your goals. We realized after a few rounds with local consultants that our doctors would not heed their advice, so we now rely on national consultants for contentious issues like strategy and coding. However, we continue to draw on local consultants for accounting reviews and compensation issues that take on a regional flavor.
While peer recommendations are crucial, the most important step is to have a lengthy discussion with your potential consultants about your situation and needs, their relevant experience and their views on how the engagement should be approached. If you cannot articulate your needs in a phone call, you are probably not ready for a consultant. Similarly, if the consultant does not grasp the complexities of your situation fairly quickly, he or she probably is not right for the job.
In the end, while the practice administrator may facilitate the process, the principal physicians need to select the consultant. If the decision is delegated to the administrator, the doctors and the consultant will not start the engagement on the same page.
How to use them
The first success factor for a consultant engagement is to have well-defined goals. If your directive to the consultant is “find out why my practice is not successful,” you will spend a lot of money while running the risk that your main problems will not be discovered or resolved. When our strategic consultant first visited us in 1995, our key questions were, “Can we develop strong relationships with local optometrists and, if not, how can we grow our practice?” The consultant answered the first question in 4 hours, and we have been successfully working on the second question for 8 years.
It is simply a waste of money to engage a consultant if the key players in your practice are not receptive to new ideas. If you need someone to tell you how great your practice is, save your money. The engagement will only be successful if the principals acknowledge a need for change and are willing to follow through on valid recommendations. That is not to say that you have to follow every recommendation, but at least listen.
When you present your gravest issues to a consultant, be prepared to show everything so he sees the whole story. If your well-defined goal is to double the size of your practice, he needs to know that your junior partner is risk averse and that you are headed toward a divorce that could reduce your capital base. The physicians and managers also need to be brutally honest at all-hands meetings with the consultant, or long-standing undercurrents will remain obstacles to change.
Finally, it is crucial that the principal physicians invest the time to meet with the consultant. We schedule at least 8 hours of all-hands doctor meetings each time our strategic consultant visits, and we hold a mandatory 4- or 8-hour doctor and staff meeting during our coding consultant’s annual visit. While strong practice managers may reliably represent the viewpoints of their physicians, they will not be effective messengers for the crucial issues that demanded a consultant in the first place.
Before you pick up the phone
If you have not recently utilized a consultant or had a management change of late, chances are that you have a considerable amount of “low-hanging fruit” just waiting to be picked. If so, I recommend that your physicians and key managers meet for one or a series of half-day retreats to identify the practice’s problems. Once the list is prioritized, the leadership team should decide what can be fixed from within. After many of those key problems have been resolved, the leadership team can begin directing its resources toward the problems that require consultant intervention.
The internal retreat sessions may also yield the revelation that your management staff is not equipped to lead a major renovation of your practice. While the American Society of Cataract and Refractive Surgery and the American Academy of Ophthalmology have made significant efforts in recent years to improve ophthalmic management performance, some practices simply have not been willing to spend the money for a first-class administrator. If your practice falls into this category, you may want to save your consulting fees and hire a manager who attacks your problems with a consultant’s mindset.
Another short-term alternative to a consultant is to arrange for another practice’s administrator to visit your practice for an informal review. Conversely, you may decide that your administrator might benefit by visiting several other practices. As long as the practice is not a competitor, most physicians feel comfortable exchanging operational and financial details in the hopes of improving both practices. Some practices may charge a nominal fee for either of these services, but the arrangements are often at no cost if there is a clear benefit to both sides.
Engaging a consultant can be a costly and time-consuming endeavor, but it also can considerably increase the value and performance of your practice. While consultants are not a cure-all for every practice problem, they may be just what the doctor ordered.