Managing to Succeed: Recipe for Success — How to Set Your Practice Up for Long-Term Prosperity
By Andrew Colbert
Vol. 20 No. 6 P. 28
Ensuring the long-term success of a radiology practice is not a simple task. Meeting the needs of the physicians and the business is a balancing act that takes time, patience, investment, and an incredible amount of work. Managers must create a culture that promotes leadership and accountability. Employees need to feel a sense of ownership within the practice and have a strong grasp and understanding of its internal purpose—the “why.” As external forces such as technology, regulations, recruiting, and market competition put greater pressures on practices, managers face tough decisions to keep their practices at the forefront of the market.
The pace of technology is rapidly changing. It is critical for practices to continuously invest in a technology infrastructure in order to remain cutting edge. An IT infrastructure is one of the most important aspects of a practice, touching everything from billing and finance to data storage, clinical workflow, and cybersecurity. That infrastructure allows practices to implement workflow efficiency systems that directly improve the patient experience. Any crack in the infrastructure can put the practice at risk.
For any practice to operate smoothly, films must be read, charges must be collected, and bills must be paid. Outdated systems have a higher chance of failing and may struggle to work with newer payment models, potentially affecting the long-term financial stability of a practice. By regularly updating internal systems and investing in the latest software, practices can prevent devastating interruptions in response times and turnarounds.
Outdated technology can also lead to cybersecurity issues. As the technology ages, the more vulnerable it becomes. Bad actors are constantly looking to penetrate weaknesses in a system that will enable them to collect private information such as credit card numbers or patient records. While no system is infallible, regularly updating and adopting the latest technology will offer practices the best chance to protect their patient and employee information.
The quality and efficiency of clinical workflow is also heavily impacted by technology. Workflow inefficiencies can have a significant impact on exam turnarounds, quality measurement, and physician productivity. By leveraging new technology to reduce or eliminate those inefficiencies, practices can dramatically improve the patient experience. As an added benefit, these workflow systems can allow for a higher level of global collaboration. Radiologists could theoretically have the ability to request and share second opinions on unique cases with ease, offering their patients an even higher level of service.
As a practice’s technology infrastructure grows, so too must its ability to collect and learn from the data it provides. It’s important to invest in data warehousing systems that are able to aggregate and analyze the vast amounts of information collected each day. The future of health care is taking the available data, understanding them, and then turning that information into actionable insights. It is critical for groups to be able to turn their data into insights in order to maintain their long-term viability within the market.
Regardless of the future of health care reform, the regulatory environment continues to get more complex. Increased focus on medical necessity and value-based payment models require new tools and capabilities. New policies are necessary in order for the practice to remain compliant with the latest standards for HIPAA, Stark Law, etc. Practices must be investing in compliance managers as well as training for all employees to effectively navigate the day-to-day challenges. This requires dedicating time and employee resources, but, in the end, it is well worth the personnel investment.
No matter the practice size, success is dependent upon a functioning human resources infrastructure. Effectively managing the hiring, benefits, and, most importantly, workplace culture only becomes more important as a practice grows. While smaller practices may struggle to justify creating this role, a functioning HR apparatus is well worth the investment and can proactively address issues before those turn into problems.
As practices prepare to bring new employees into the business, they must ensure a strategy is in place to both recruit and retain the best talent available. Practices must employ proactive approaches that market to and attract the talent they want. Waiting for the right talent to find the practice is no longer feasible, given the competitiveness of the current hiring landscape.
This strategy should always connect to the practice’s internal “why” and reflect its culture and core values. Practice managers must align the vision and strategy they want to utilize before undertaking any sort of recruitment effort or risk attracting talent that, while skilled, may not be the right cultural fit.
With the addition of new employees, practice managers must recognize that the existing employees may feel uneasy about the changes they bring. Those feelings can be assuaged by helping employees understand the benefits of growth both clinically and financially. Growth is both an opportunity and a challenge for many practices, as more people bring more complexity and more politics. In order for leaders to successfully drive growth, they must ensure that all employees have a shared understanding of the internal “why.”
With thousands of radiology practices across the country, the recipe for success requires the formulation of a strategic plan that emphasizes competitive advantages through investments in technology, compliance, and recruiting. This is a tall order, but especially so for a radiology practice without significant administrative infrastructure. Because of this, many groups across the country are considering strategic consolidation among practices. By coming together with the right partner or partners, practices can gain access to capital, increase their administrative resources, and effectively build scale to remain competitive.
The first step before considering any partnership is to identify short- and long-term objectives, to understand the firm’s current strengths and areas of need. Once that strategic plan is in place, the next step is to identify a partner who can help the practice achieve those objectives. Approaching consolidation in this way ensures the practice won’t waste time or resources pursuing potential partners who won’t be a good long-term fit for the collective.
Balancing the needs of the physician owners with the needs of the practice will never be simple, but it’s the key to successfully ensuring the long-term success of a radiology practice. The best way to reach this balance is through establishing a leading culture that others will want to join. Additionally, staying on top of the latest technology, maintaining compliance, and differentiating from the competition are challenges that nearly every practice is currently facing. By recognizing and understanding these challenges, radiology practices will be better prepared to navigate any issues they may face in the future and drive long-term success.
— Andrew Colbert is a managing director and founding member of Ziegler’s Healthcare Corporate Finance Practice. He has completed numerous affiliation/merger transactions for physician groups and specializes in advising on strategic and financing alternatives, including mergers and acquisitions, capital-raising transactions, and partnership development.