Re: LOW OVERHEAD

[Guest guest]

, I realize that my numbers are EXTREMELY low but I was trying to do two things when I opened my office..1) Blend my voluntary simplicity lifestyle with my employment model  (bare bones, ultralight)and2) Create an experiment on work volume and overhead.  I really wanted to see"HOW LOW CAN I GO" on overhead and still function. (regionally I may be higher on the reimbursement and better malpractice rates so things may be different elsewhere. I was merely trying to prove a point - in a dramatic way.  I'll attach the handout on how I did this below)CREATE YOUR IDEAL MEDICAL PRACTICE: Thrive Don't Just SurvivePamela L. Wible, MDLearning Objectives: 1) Understand why self employment may be the best option for realizing YOUR personal, professional, and financial objectives  2) List benefits of low overhead volume practices and best methods to limit overhead. 3) Master the calculation of overhead as days needed to work (DNW) and number needed to treat (NNT) 4) Learn how to activate your community in designing & marketing your practice for you. LOVE: Low Overhead Volume Employment :  an experiment in finances and work volumeLow Overhead Volume Employment (LOVE)    vs.  High Overhead Volume Employment (HOVE) Ultralight Practice Typical Housecall MDs "Assembly Line" Boutique Practices Large Corporate     My LOVE story  2000-2002 2005-current Employee/partnership potential Self EmployedFull Time Part Time4 full days/ week 3  half days/ week 112 pts/wk 28/d 25 pts/wk   8/d2500 + patient panel 300-400 patient panel$130 K/ yr (110K + "bonus?") $130 K/ yr370K/ yr OH 10 K / yr OH> 30 K mo  OH <1K mo  OH My Yearly "Ultralight" Overhead (OH) rent @ 300/mo 3600 Personal health ins. 2200 Malpractice (@ 60% off) 1230  Supplies 1000 Phone cell + land 700 Hospital/society Dues 600 Office liability insurance   500 9830  < 10K/yr Get Your Malpractice Discounts! * 5 year maturity on claims made policies =  steep discounts first 4 years * "Fresh out of residency discounts" x 3 years * Loss prevention credits (7.5% discount) * Part time discounts (up to 50% off!) * Board certified (2.5% discount)  (The LOVE practice makes your malpractice risk close to nil)Control Overhead and THRIVE (3 simple calculations that will save YOUR life) 1) Your OH / Total Revenue/yr => % OH     2) #1 x # days/yr worked => DNW 3) #2 x avg # pts/day =>  NNT My Salary 1) HOVE  440K - 330K OH --> 110 K base     500-440K x 33% -->  20 K production "bonus?" ---> 130K     (5432 pt visits, $2577 day collected, $92/per pt.) 2) LOVE projected 140K - 10K OH  ---> 130K      (1250 pt visits/yr, $930/half day, $112/ per pt.) OH! OH NO! The BIG SURPRISE! Yearly Overhead (OH!) as % of Total Revenue  1) HOVE 370K/500K -> 74 %  (MGMA 2000 avg 60%)   2) LOVE   10K/140K -> 7 % DNW (Days Needed to Work) to pay OH  1) HOVE @ 194 X 74% --> 143 FULL days   (> 8 months) 2) LOVE @  150 half days  x 7%  --> 11 HALF days     (< 1 month) NNT (Numbers Needed to Treat) to pay OH  HOVE @ 143 x 28   --> 4004  LOVE @ 11 x 8.3   --> 91  This is news to me! Recruiters, MGMA, medical organizations, and stakeholders give statistics based on HOVE practices. LOVE practices were the norm 50 years ago, but most docs are not exposed to LOVE data in training, journals or elsewhere and are heavily marketed with HOVE "opportunities" My Professional Desires --> My Professional Climax Bike to work Bike to work 1 mile Work part time 2-3 days/week WorK PT  3 half days/week Positive environment Positive & empowering environment Minimal call / hospital work Minimal inpt. (2 in 11 months) Manageable call Noninvasive call (<2/mo) Flexible vacation Vacation whenever I want Appreciative patients Appreciative patients Excellent collection rate Unexpected Benefits Time for medical volunteerism (Katrina disaster relief) - see articles Medical journalism - I love to write and have published multiple articles Academically stimulating (time to research medical mysteries, attend consultant visits) Local/regional fame/admiration (colleagues, patients, health plans) Why Community Involvement in Clinic Design? They are your eventual patients They have great ideas and insights you may value They serve as a a business consultant  They are a built in patient panel on day one of your practice They become a network of loyal patients who market your practice for you Why Solo/Solo? Why not? Will staff add value? No staff = Low overhead = Less HAs Flexibility &   spontaneity  No micromanaging others, embezzlement concerns The business of medicine no longer a delegated mystery Become a coding expert  Simple with today's technology LOVE : An experiment in finances and work volume The RESULTS are in.. * same salary  BUT... * 23% (1/4th) work volume by total pt visits yearly * 3.8% (1/26th) of work volume as DNW to pay OH * 2% (1/50th) of the work volume by NNT to pay OH Who should consider self-employment?  Everyone but especially physicians who... *have independent spirit *are creative and "out of the box" thinkers *value balance (part timers, moms, dads) *value high quality leisurely interaction with patients *want to pursue other interests  *may exceed there wildest financial expectations                                    Sounds great, but how do I start? Transitioning from HOVE to LOVE Jumping from residency to LOVE  OPEN LOVE in 4 Steps1) OPEN your mind on a RETREAT to envision your ideal practice2) PLAN your model (You made it through med school. It's not rocket science) 3) EXPLORE Locums, UC, part time jobs (great for checking out various locales) Hospital recruitment package with guarantee for setting up solo practice NEVER, EVER sign a NON COMPETE clause!4) NEED HELP? Contact me with questions.Pamela L. Wible, MDPhone #  Email:  roxywible@...Webpage:   www.idealmedicalpractice.orgOn Mar 16, 2006, at 5:32 AM, Brock DO wrote: 91 patients pays your yearly overhead?  I don’t think that would pay my monthly overhead, and I still consider myself moderately low in the overhead category.     Re: How much social burden? Regarding social burden;   1) Traditionally doctors all saw poor patients at discount. I interviewed several "old time" docs who told me that in the era before medicare they would see fixed income seniors for $2 per visit vs. their usual $5 per visit (1957 stats)   2) The premise of my grand rounds presentation in NY is THRIVE, don't just SURVIVE.  Altruism can not be forced, but I feel that in survival mode (medical sweatshops) physicians are less likely to tap into their altruism.  In the THRIVE mode (ultralight, for example) one would hope that we would be able to function with more compassion.   3) When not working for free (to pay overhead) seeing 4004 pts per year (vs. my 91 now to pay yearly overhead)  I actually have time to volunteer.   I had  the energy, time, and desire to get on a plane at a moments notice and volunteer at Katrina for a week just after the hurricane. A colleague of mine who works in a medical sweatshop managed to extricate herself (with a great deal of force )and go with me. She was reprimanded when she returned to her "day job"   Most docs are in an energy deficit (overburdened) and have little time to care for their own needs in survival mode.  The social burden is hard to solve in this setting.   Thrive, don't just survive!   Pamela   Pamela Wible, MD Family & Community Medicine, LLC 3575 st. #220  Eugene, OR 97405 roxywible@...           Gordon, I'm with you on this one.  While maintaining professional sensibility ("no margin, no mission") I think we do need to maintain our professionalism. Finding a way to "give back" something to the larger society is still important. I do think that can take the form of many different things.  However, providing medical care to the poor and needy in some way or another is something we can do that most of the people can not. Sadly, the structure of our medical world is now such that what is considered doing the right thing can be burdensome and overwhelming. I wish they were easy answers.  But I do hope we all try to find an answer that works in our lives. Tim Malia, M.D. > Once again I think we're in a relatively unique position to > demonstrate how a practice can take the high road and succeed. > > We each take on some share of the burden of supporting our > communities.  Maybe this takes the form of a percent of our care that > is given to those who fall between the cracks of gov't assistance and > the ability to afford health care (a frighteningly large number in  this > wealthy nation), maybe it means accepting low paying gov't > insurance as a part of our work. > > I don't know what the percents should be for any practice and would  not > presume to dictate.  Let it not be so much that it detracts from  our > ability to deliver superb care in a vital and sustainable > practice, yet let it be enough that we may stand in the public venue > and decry the iniquities of our crazy health care "system." > Gordon > At 08:39 PM 3/14/2006, you wrote: >>Since I started, I was called by many medicaid patients and I am so >> sorry I have to refuse all of them. I had such a hard time with my >> previous practice and medicaid, such a bad experience that I >>absolutely decided I will not take any medicaid. I have a couple of >> charity cases each month, I will offer some discounts to others and >> that's it. > > > > > >