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The business of medicine is no easy task

The practice of medicine is an art, but managing a business is a skill that requires training, said Sudbury dermatologist Lyne Giroux.
Lyne Giroux 1
Sudbury dermatologist Lyne Giroux knows all about the pitfalls and challenges of starting a private practice.

The practice of medicine is an art, but managing a business is a skill that requires training, said Sudbury dermatologist Lyne Giroux. 

She knows all too well the growing pains of starting a practice with next to no business training, but as a specialist and the only dermatologist in the city, she didn’t have the luxury of walking into a turnkey pre-managed facility or joining a group practice with shared overhead costs.

In 2005, Giroux set up shop in Sudbury and blazed her own trail through trial and error, armed with only a one-day practice solutions course and manual offered by the Canadian Medical Association, an evening course with a staff dermatologist during medical school, and colleagues’ advice.

Even the process to acquire the appropriate credentials before putting out her shingle became a “confusing trail of paperwork” and hoops through which to jump before obtaining a billing number.

Few people realize what is involved in running a business, yet hiring staff, purchasing and financing equipment, extensive overhead, signing a lease, learning the billing process, and determining the number of patients seen per hour are business-related skills required at the outset.

“There was a lot of thinking and planning, and sleepless nights,” she said, explaining that she would have liked to have been given a specialty-driven “to do” list, more time, and access to an expert to answer questions. Giroux also would have liked to have been taught proper billing procedures during residency.

“I lost a lot of money the first year, because of errors in billing,” she said. “It’s kept a secret until the very end, it seems, in some training centres.”

Other professionally trained doctors like naturopaths and even dentists have said their business start-ups also became a process of “learn as you go.”

Northern Ontario School of Medicine’s founding dean Dr. Roger Strasser said it isn’t until doctors are in their second stage of training as residents that the business aspects of being a physician and running a medical practice start becoming important.

At that time, specialty courses in business management are offered during residency, often as part of a larger course presented in half or full-day sessions. As well, the Canadian Medical Association and Ontario Medical Association also provide comprehensive courses.

“I think timing is everything,” Strasser said. “As residency comes closer to completion and they may be interested in going out on their own, they get more interested.”

He added that sometimes residents chose to practice as locums and travel around to test out different communities, practice styles, and business models before deciding where and how they will practice medicine.

Although he admitted there is probably a need for more courses on business management, he would like to see one that looks at how physicians fit into the whole health-care system, which the OMA is addressing with its Physician Leadership Development Program. Launched in September, the OMA is recruiting physicians to participate and provide input into Ontario’s health-care system through this program.

Strasser also noted that there is a changing sense of priorities among recent medical graduates. Today’s graduates want no part of the paperwork or overhead that comes with running a private practice.

They are more comfortable being employees on staff either at a hospital or community Family Health Team (FHT), a new delivery system that allows physicians to collaborate in a multidisciplinary capacity.

Historically, most physicians were considered private practitioners and their practice was a small business.

They would work long hours during the day seeing patients, and then spend long evenings doing the paperwork.

However, Strasser said that in family practice, the trend over the last 20 years has been to work in groups so a greater focus can be on medicine instead of administration.

New funding systems in the province have encouraged family physicians to form groups of FHTs and sign on to alternative payment arrangements instead of the fee-for-service system where physicians are paid for each individual service they provide.

To date, 170 FHTs have been established across Ontario, resulting in the decline of the solo practice, particularly within the last five years.

“The newer physicians are looking for more of a turnkey operational-type set up,” said Jim Sweeney, senior consultant, MD Physicians Services Inc., a consulting service for Canadian Medical Association members.

Sweeney provides business consulting and hotline services as well as educational presentations to CMA members, whether they are working individually or in a group practice. He has worked with physicians in varying capacities for 38 years, providing advice on how to make the practice more efficient in its operations, human resource needs and policies, and governance structure.

He has noticed that the new graduates will stay away from the business headaches associated with running a medical practice.

“They’ll go in and work hard but they also want a balance where they can have a good life outside of medicine,” he said. “Family physicians are getting very wise about the fact that fee-for-service is not for everybody and that going on to a capitation base model (fees based on individual patients, not services) can be very financially rewarding and provides, normally, a better lifestyle.”

Conversely, Sweeney said that physicians will be the first ones to say they are not the greatest business people, yet he has met a lot of “very competent physicians as business people.”

He said all CMA members are allowed a 30-minute free consultation once a year. The CMA also provides educational modules online for new physicians.

“We’re trying to make them aware of what they are walking into and not just kind of jumping and taking the first offer out there.”

The shortage of family physicians has also created more opportunity for new graduates. Sweeney sees a wiser and smarter wave of young people who check out job prospects more thoroughly.

His common message to all new grads is: “Do your research before signing on the dotted line.”

For those who choose to brave a solo practice, Giroux’s advice is: “Make sure you have a good lease agreement that has been signed by both parties and file it in a safe place.”