Why physicians require business skills [PODCAST]

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“There are two valuable reasons why all physicians, especially medical students, should obtain or demand from their medical school academic business education.

About 98 percent of physicians and medical students have never had an academic business education. About 30 to 50 percent of graduating medical students prefer private medical practice—which requires business and marketing knowledge to reach their optimal potential in private medical practice.”

Curtis G. Graham is a physician.

He shares his story and discusses his KevinMD article, “Financial survival for physicians in private medical practice.”

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Hosted by Kevin Pho, MD, The Podcast by KevinMD shares the stories of the many who intersect with our health care system but are rarely heard from.

Transcript

Kevin Pho: Hi, and welcome to the show, where we share the stories of the many who intersect with our health care system but are rarely heard from. My name is Kevin Pho, founder and editor of KevinMD. Rate and review the show at KevinMD.com/rate. Subscribe at KevinMD.com/follow. Today on the show, we have Curtis Graham. He is an obstetrician-gynecologist, and he’s here to talk about his KevinMD article titled “Financial survival for physicians in private medical practice.” Curtis, welcome to the show.

Curtis G. Graham: Thank you, Kevin, for giving me the opportunity to discuss a few things that I consider very important to the medical profession in general, and specifically to private medical practitioners.

Kevin Pho: All right, so we’ll get into that article in a little bit. First off, briefly share your story and journey to where you are today.

Curtis G. Graham: Well, I practiced about 40 years in clinical medical practice, and I found out that there was something I was missing through all those years, and I made a vow to find out what the problem was. As it turns out, I was business ignorant and didn’t understand what that meant to a physician in private practice. And so I didn’t catch on to that. My practice was fantastic, and then all of a sudden, I’m finding out that it disappeared from under me. And so I was forced to launch back into the employment part of the practice of medicine, as is happening to thousands of doctors in this country now, and everybody’s wondering why. I had the same questions, and I vowed to myself when I retired that I would go back and find out the real reason behind all of this, which all physicians ought to be aware of. And that’s why I’m here today.

Kevin Pho: So when you said that your practice disappeared from under you, what exactly did you mean by that?

Curtis G. Graham: Financially, basically. I was so business ignorant that I didn’t understand one of the requirements of business across the world today, among all businesses, and we know medical practice is a business, so it applies to the medical practice business as well. So I found out that you have to have a good knowledge of management of business and a good knowledge of marketing for business, the two qualities that make every business successful, one way or another. And so I finally recognized that after I retired and began researching the whole process.

And what surprised me was that the medical schools, for some reason, across our nation, all of them, have never had any idea about teaching doctors about business and marketing, and none of them had offered courses in business and marketing in the medical schools. And when I found that out, then I found out my problem was that I was business ignorant.

Kevin Pho: So we’re going to get into your article in a little bit, but before we do, I just want to ask you to give my audience a sense of what your practice was like when you were in private practice. How many people were there, and did you have administrative staff who presumably would manage the business side of your private practice?

Curtis G. Graham: Well, I never made enough money in my practice to really hire a manager for the practice, and from the stories that I found out about, supposed practice managers aren’t so hot either. But I couldn’t afford to do that. I could afford to continually maintain my practice on the cutting edge of medical practice. I was the first to have an ultrasound in my practice in OB/GYN in the area that I practiced. I was the first to do laparoscopic surgery in Northern California at the time, and such things. I loved that. I wanted to be the best I could be, and I never found out until later on why I was being held up, for financial reasons primarily.

Kevin Pho: So you were by yourself. I assumed you had all those medical assistants, but primarily by yourself, is that correct?

Curtis G. Graham: Solo medical practice, by myself.

Kevin Pho: All right, so let’s talk more about your KevinMD article, and you can share some of the lessons that you’ve learned. It’s titled “Financial survival for physicians in private medical practice.” Now, for those who get a chance to read your article, just walk my audience through it.

Curtis G. Graham: Well, I thought it was critical when I found out that medical schools had never, over the last century, offered business and marketing education. The research that I did after I retired from practice in 1999 showed me those things, and I just want to make everyone aware of what they are missing. And there may be thousands of doctors out there now; I would estimate that probably 95 percent of medical doctors who graduate from medical school today are truly, basically, business ignorant. Some learn by their experiences of working in a business or something like that, but to get the real quality stuff that you get out of that education, it needs to be a formal education in business and marketing. And that’s what schools need to add to their medical school curriculums, which they have not done.

I’m trying to do all the things that I know to stimulate those people to do that. I feel that probably the administration of the medical school programs, which begins with the group that runs the curriculum process, and that is the American Association of Medical Colleges. I’ve written to them several times and sent them information, and they don’t respond at all. So I suspect that all those administration people over the century have probably never had a business education of their own, so they don’t understand the importance of that. Now, all commercial businesspeople understand those things, and I have never reasoned why a medical school would send doctors out into private medical practice, for example, with no idea how to manage it properly, efficiently, and profitably.

I’ve often wondered why the students themselves never questioned that. Why were they blind to all those things, and to the things that would release their ability to achieve maximum opportunity and maximum abilities in their profession, to be the best they can be? And they don’t seem to realize that at all. And I’m fighting against what I call an impossible mission. How am I ever going to change the medical school curriculums and add on a business education at the same time?

I think a few schools are trying to do that, but the biggest mistake they’re making right now, I believe, is that the MBA program, the two years, either on campus or not, is so horrendously expensive now that people can’t stop their medical practice, go to campus, spend two years, and spend $40,000 or $60,000 to get it. They come back and they wouldn’t have a practice left. So I have set up a couple of medical websites in which I have 154 medical articles, discussing exactly how any physician can learn what they need to know and how to gain the tools that they can get from that education, on that website.

Kevin Pho: As you reflect back on your private practice career, let’s go into more detail. What specific business aspects do you think future doctors need to have to practice in a private practice setting?

Curtis G. Graham: Well, number one, I didn’t know how to hire people and to fire them. I didn’t have a personality with which I could fire a person, because I liked everybody and I wanted to make friends with them. And so, therefore, I put up with things I never should have put up with. So the management of the people was one big thing.

The second thing was to understand that you have to be aware every moment in your medical practice that there are things that you can do that will improve your practice. And if you don’t know those things, then how would you know? How would any physician know if their practice is going downhill, unless they are just using their monthly statements from the CPA to see how they’re doing in their practice? And that doesn’t tell them much, because I doubt there’s 1 percent of physicians who can explain the bank statements that come from the CPA and tell them about their profits and losses, and who can explain it clearly.

Kevin Pho: What would be an example of a metric that would measure the status of a practice outside of a CPA’s bank statement? What would be an example of that?

Curtis G. Graham: Well, the biggest one is, you walk up to any doctor today and you say, “Is your practice growing, or is it going downhill?” And they have no measurement of status in their practice to find that out or to understand that. You would think that maybe the simplest thing would be to say, “Well, I’ll figure out how many new patients came into my practice last month, and I’ll find out how many we have to send the records out to other doctors for, that have moved.” And probably less than 5 percent of doctors ever take the time to do that. That would at least give them the beginning idea of what’s happening with their practice.

So it’s all a visual, thoughtful approach to the finances in medical practice that accomplishes nothing. And probably those thousands of doctors every year who lose their medical practice for financial reasons are still wondering, “What happened to me? You know, what happened? I would do everything right. I don’t think I did anything wrong.” And boy, are they where I was at that time.

Kevin Pho: We’re talking to Curtis Graham. He’s an obstetrician-gynecologist. His KevinMD article is titled “Financial survival for physicians in private medical practice.” Curtis, where can people find your articles? What’s the website?

Curtis G. Graham: I’ve started a new website, which should be up in the next couple of months, and that’s managementmedicalpracticebusinessandmarketing.com. That website contains the 154 articles, each article specific to an area of marketing or an area of business, that accumulate the knowledge that they need to do what they have to do. And they don’t have to spend $60,000 on an MBA program, which is so superficial. And if you talk to medical students who had an MBA before they started medical school, which I did, I interviewed those, every single one of them said, “That MBA gave me far less information than what your website and your articles have done.”

Kevin Pho: Curtis, thank you so much for sharing your story, time, and insight. Thanks again for being on the show.

Curtis G. Graham: Thank you very much, sir. You have a wonderful day.

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