Factors to consider before making the hire, and what to look for in a new doctor.

Is it time to add a doctor to your practice? The best practices prudently plan ahead, just like the best surgeons plan ahead for each case, even if the time frames are a bit different.

The goal in both settings is to be careful, intentional and, ultimately, effective.

What are the indications for starting the search for the next provider? Here are some examples:

• Current doctors are exhausted at the end of each clinic day.
• A partner is heading for retirement, or a young doctor is starting a family.
• Your practice has strategically planned for 15% annual growth, and your rural location makes it imperative to start the recruiting process early.

SUBJECTIVE CONSIDERATIONS

Determining the best time for adding a doctor to your practice is based on many factors. These include:

• Growth pace. Faster growing practices have to plan ahead.
• Residual capacity of existing doctors. If your existing doctors are on average only at 70% of personal capacity, there would be little point in adding a provider.
• Subspecialty considerations. Your practice may be well staffed overall, but have a bottleneck in one subspecialty area.
• Elasticity of plant, doctor and staff capacity. Some teams are able to dig deep and take on more patients. In such settings, especially when demand is seasonal, provider recruiting might be reasonably delayed.
• Risk tolerance. Adding a doctor is an investment that some existing partners may not have a tolerance to undertake. Even in the best situations, owners have to be comfortable with a period of income cannibalization.
• Good luck. From time to time, a just-right candidate surfaces before you are ready for them.
• Your location. It may only take 90 days to find a new doctor in Los Angeles, but 30 months in Topeka.

All these factors taken together don’t add up to a finite, objective score but can lead you to making a better (if largely subjective) decision. Consider each point listed individually then evaluate as a whole.

DO THE MATH

Although a lot of hunch work is involved when making the hire/don’t-hire decision, one can at least roughly approximate professional staffing demands.

In a general/anterior segment practice, most providers top out at about 550 patient visits per month (including postop visits). A doctor who sees about 650 visits per month is at about 120% of nominal capacity. If the practice is growing (and patients can’t be readily shifted back to their referral sources), it may be necessary to start recruiting. (The same V-max norms are about 350+ visits per month in oculoplastics and pediatrics, and 450+ per month in retina and glaucoma care.)

In the best case scenario, your practice has a five- to 10-year strategic plan that lays out a forecast of how fast patient visits will be growing and can spell out the necessary pace of recruitment.

The acid test for all provider recruitment decisions is to draw up a 12- to 24-month pro forma showing expected cash flows after adding a doctor, which includes anticipated patient visit volumes, revenue changes and new costs. This leads to a month-to-month projection of cash flows (along with the transient, near-term losses that current owners will have to bear). Developing a pro forma like this forces you to consider the many options you have, solidifies your assumptions, sets goals and assures that the board and the management team are in accord.

Also, consider that many practices on the fence with this decision will build an advance, dedicated capital reserve before hiring a new doctor, providing a cushion against unanticipated losses.

MAKE IT STICK

Keep in mind that, irrespective of the vetting diligence, a new partner-track associate sticks around and becomes a partner only 50% of the time. To improve your odds, it’s important to make not only good financial decisions when hiring a new doctor but also good personality and practice culture fit decisions.

To help achieve this, create a task force to make this hiring decision that includes the administrator, managing partner and a head technician and any other staff members you deem appropriate. Such a task force, with its members’ various perspectives, can go more deeply than the usual candidate interview and learn the following:

• Does this candidate show the potential to develop strong collegial relationships with internal and referring physicians?
• Does the candidate show the appropriate interest in the business side of the practice?
• Will the candidate’s personality attract and retain patients?
• If we want a doctor who can be a role model for excellent customer service and exceed our patients’ expectations, does the candidate provide the impression that these are important to him, too?
• Does the candidate’s views on work/life balance fit with our practice’s culture?

These deeper insights, which can lead to better physician retention, can be as important to evaluate as the physician’s surgical skills.

CONCLUSION

Determining if and when to add a doctor to your practice, and subsequently selecting the best candidate, is one of the biggest challenges that a practice faces. Following the aforementioned steps will frame up the basis for making this decision. OM

Corinne Z. Wohl, MHSA, COE, is president of C. Wohl & Associates, Inc., a practice management consulting firm. Corinne earned her Masters of Health Services Administration degree at The George Washington University and has 30 years of hospital and physician practice management experience. She can be reached at czwohl@gmail.com or 609-410-2932.

John Pinto is president of J. Pinto & Associates, Inc., an ophthalmic practice management consulting firm established in 1979. He is the leading author in America on the business of ophthalmology. His latest book, “Simple: The Inner Game of Ophthalmic Practice Success,” is now available at www.asoa.org . He can be contacted at pintoinc@aol.com or 619-223-2233.