Subject: Practice Success

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March 22, 2019
Dear Friend,

Spies. 

It's the subject of this past Monday's blog post, You Have A Spy In Your Medical Practice. Follow that link to the blog or just keep reading for whole story:

Spies.

What image just flashed through you mind?

James Bond? George Smiley? Aldrich Ames?

No, not them, but, rather, the one that you undoubtedly have within your organization.

Today, there are criminal cases in which a defendant’s Amazon Alexa has been subpoenaed to allow prosecutors to tap into its memory of what was said at the scene of the crime. There are civil cases in which the onboard computer inside a car has been, in essence “questioned,” in order to get information about the speed of the car at the time of an accident.

Right now, in your medical practice or healthcare facility there are undoubtedly computers and also other devices that have memory which may be able to be tapped for information. Not, perhaps, realtime, but at least tapped into later to discover information about your practice.

Some of these devices are as innocuous as the multipurpose copier sitting on a desk, but others are medical devices of many sorts – especially as those devices become “smarter,” more equipped with extra memory designed to communicate with electronic health records.

Think about what information is on those machines. Consider how you have to protect them, not only for HIPAA purposes, but for what information they could reveal about your practice and your business operations.

Think about to whom they may soon be talking.

Tuesday - Success in Motion Video: Synthesizing Large-Scale Medical Practice With Bespoke Customization

Watch Tuesday's video here, or just keep reading below for a slightly polished transcript:
What do custom bike frames have to do with the success of your medical practice, especially if it’s a large group?

Remember studying the Industrial Revolution in high school? In particular, there was a shift in manufacturing from the
 “guild” system, in which craftsmen created one-off products one at a time, to industrialization and factories, in which products are mass produced.

The benefit, of course, for society in general is that items that were expensive and in short supply because they were made one at a time were now made en masse. Prices went down, availability went way up.

In some cases, quality stayed the same. But in many cases, depending on the item, quality suffered.

Today there’s a rebirth of sorts in the bespoke world, from bespoke tailoring to bespoke shoes. To a slightly lesser degree of customization, there's also made-to-measure and made-to-order, in which an item is not completely made just for the customer, but is custom fitted or custom produced on a one-off basis.

A recent story in the Wall Street Journal focused on a bicycle frame manufacturer producing uber high-priced bikes - we’re talking about frames that sell for thousands and thousands of dollars. While a lot of the business has shifted to carbon fiber, which can be mass-manufactured, the subject of the WSJ article creates custom titanium frames which sell for, at a minimum, almost $5,000. Each frame is made just for the rider who was willing to spend the five, six, or seven thousand dollars just for the frame, let alone for the rest of the bike.

What does that have to do with medicine and medical practice, especially with a large group?

Medicine has become more factory-like with the aggregation of practices into large entities and the introduction of outside money, that is, private equity and publicly held money, into the aggregation of medical groups.

In many cases, the previously existing relationships have suffered, whether we're talking about provider to patient relationships or group to facility relationships. 

I’m not suggesting the solution to this is to go back to a complete craftsman model where practices break up and all we have are solo physicians treating patients one at a time, the “concierge” practice model. I believe that works on a small scale for those willing to pay for it, but it doesn’t work on a large scale.

Instead, consider the impact of the made-to-measure or the semi-custom model where patients and relationships are treated in a way that transforms not just the delivery of a service or the delivery of an experience, but the delivery of an experience within the setting of a much larger business that creates a true sort of transformation for the patient.

Think of the distinction between a large internal medicine group which has a lobby that looks like the DMV, which gives patients numbers and calls them out loud, and another large practice in which the front stage, the image portrayed to the patients, is one of actual customization and care. Think how those latter practices thrive in a very different way. The relationship is on a much higher level.

This sort of "made-to-measure" relationship also plays out between a hospital-based group an a facility. 

Think about how you can customize or semi-customize your relationships.

Wednesday - Medical Group Minute Video: Community Hospitals Must Change Or Die. Change Presents Opportunity for Entrepreneurial Physicians

Watch the video here, or just keep reading below for a slightly polished transcript:
In a recent article in the North Bay Business Journal, Jan Emerson-Shea, vice president, external affairs at the California Hospital Association, was quoted, when speaking of community hospitals, as saying that, “there’s a host of challenges that all hospitals face but particularly these small, independent hospitals. Some of these hospitals file bankruptcy, some shut altogether, some are able to go to local voters, and some affiliate with larger health care systems that have the ability to keep them open and provide them access to capital.”

The Impending Death of Hospitals is hitting community hospitals particularly hard.

That, of course, is a peal of the bell that tolls for thee, if your medical group is dependent on the survival of the local hospital.

But, at the same time, it’s an opportunity for entrepreneurial physicians to participate in the repurposing of mooted hospital facilities.

Ventures we’re currently looking at include repurposing community hospital facilities as medical malls, surgery centers, “condo-ized” surgery center units, and “non-hospital hospitals.”

As the economist Joseph Schumpeter wrote in Capitalism, Socialism and Democracy, capitalism “is by nature a form or method of economic change and not only never is but never can be stationary. And this evolutionary character … incessantly revolutionizes the economic structure from within, incessantly destroying the old one, incessantly creating a new one. This process of Creative Destruction is the essential fact about capitalism.”

Creative destruction is taking aim directly at community hospitals. You can fight to save them. But if they’ve failed, you can, á la Shumpeter (and Weiss), take part in creating, phoenix-like, far more appropriate healthcare solutions for your community and for your profit.

Let’s talk to get started.

Thursday - Podcast: Escape The Prison of Cost Based Thinking
Listen to the podcast here, or just keep reading for the transcript

Many medical groups, especially those run as a club or collection of colleagues, fear spending any money because they view spending as a cost. They view it as decreasing the cash available for distribution and their business is all about current cashflow. They have a pure lifestyle business.

Perhaps that business played out well for 20 years. But in today’s market, it’s a losing proposition.

Many physician groups are afraid of what’s going to happen in the future. Continued hospital-controlled healthcare. Perhaps even government controlled healthcare, especially the looming single payer system if Clinton is elected president.

Your only hope of breaking out of those constraints is to become aggressive in doing deals and in finding new ways of growing your business — and that requires spending money.

If your mindset is that spending money is a cost then you’re going to be constrained every time, by yourself, by your colleagues: “We need to keep up cash-flow.”

Instead you have to consider spending on your future as an investment in yourself and as an investment in your group. It’s a mindset change, but it is incredibly powerful.

Try this: Ask yourself what you or your practice or medical group is worth. Now can you honestly say that you wouldn’t invest $100,000 or even $200,000 to protect that value?

Books and Publications
We all hear, and most of us say, that the pace of change in healthcare is quickening. That means that the pace of required decision-making is increasing, too. Unless, that is, you want to take the “default” route. That’s the one is which you let someone else make the decisions that impact you; you’re just along for the ride. Of course, playing a bit part in scripting your own future isn’t the smart route to stardom. But despite your own best intentions, perhaps it’s your medical group’s governance structure that’s holding you back
In fact, it’s very likely that the problem is systemic. The Medical Group Governance Matrix introduces a simple four-quadrant diagnostic tool to help you find out. It then shows you how to use that tool to build your better, more profitable future. Get your free copy here.
Whenever you're ready, here are 4 ways I can help you and your business:

1. Download a copy of The Success Prescription. My book, The Success Prescription provides you with a framework for thinking about your success. Download a copy of The Success Prescription here.

2. Be a guest on “Wisdom. Applied. Podcast.” Although most of my podcasts involve me addressing an important point for your success, I’m always looking for guests who’d like to be interviewed about their personal and professional achievements and the lessons learned. Email me if you’re interested in participating. 

3. Book me to speak to your group or organization. I’ve spoken at dozens of medical group, healthcare organization, university-sponsored, and private events on many topics such as The Impending Death of Hospitals, the strategic use of OIG Advisory Opinions, medical group governance, and succeeding at negotiations. For more information about a custom presentation for you, drop us a line

4. If You’re Not Yet a Client, Engage Me to Represent You. If you’re interested in increasing your profit and managing your risk of loss, email me to connect directly.

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