Key thoughts:
• There is substantial complexity in healthcare related to many logistical factors and growing medical knowledge.
• Efforts to transform the way we do things has introduced re-organization, more oversight, and an uneasy gap between physicians and administrators
• Alignment comes from building bridges with mutual understanding, and maintaining a focus on the patient experience and outcomes
Administrative costs have increased to over 25% of the healthcare dollar in the hospitalized patient [1], exceeding and far outpacing growth of professional services. While it’s not clear if there is a similar overhead on the ambulatory side of care, meaningful use and large group employment is likely driving a similar trend. Since physicians have previously enjoyed relative independence in their practices both in and out of the hospital, this new physician-administrator relationship may stress the delicate balance in medical centers.
Complexity in billing, collections, insurance contracts, compliance, regulations, purchasing, human resources, staffing, and other operations account for needing more administrators. Physicians have concomitant demands, most importantly keeping up with best practice resulting from a growing medical knowledge-base. This is eclipsed by declining reimbursement, productivity targets and pressure to assume more of a care coordination role.
In this new dynamic between physicians and administrators, working in a cocoon creates isolation rather than engagement. And power struggles are counterproductive, although each player needs to demonstrate their value to the other.
Administrators earn respect from physicians when they roll up their sleeves, help make things work on the front lines, and understand the frequent hurdles physicians encounter that are not related to being a doctor. Physicians need to appreciate when the administrator is their advocate, and that they can help smooth coordination of care to result in more efficient quality outcomes. Just as physicians are judged on their clinical activity each month, administrators need to prove their worth to physicians. Bridging this gap is the first step towards creating synergies that can achieve our common purpose.
[1] Himmelstein DU, et al, “A comparison of hospital administrative costs in eight nations: US costs exceed all others by far, Health Affairs, 1586-1594, September 2014.
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This column is part of a series devoted to clarifying and enhancing the physician-health system relationship. Dr. Ken Altman is Chief of Otolaryngology at Baylor St. Luke’s Medical Center in Houston, TX. He is also Secretary/Treasurer-Elect of the American Academy of Otolaryngology – HNS, and past-President of the American Laryngological Association.