Business

Smaller offices can use office managers, too

A column about keeping your practice in good health

By Mike Norbutcovered practice management issues during 2002-06. Posted May 24, 2004.

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From the largest multispecialty group to the smallest startup practice, physician offices need staff to run smoothly. While some doctors like the idea of running the office, at some point as the practice grows, they might need to hand over administrative reins to concentrate on treating patients. Enter the office manager.

While the position has been around practically since the creation of the medical group, the office manager is not a staple of smaller practices. Some practices get by with a couple of office workers doing everything, while others have the physicians themselves intimately involved in everything from payroll to billing.

The point at which physicians and consultants suggest hiring an office manager varies. Some say as soon as possible. Others suggest when your day is spent more at busywork than clinical duties. It's essentially a personal decision that can bring tremendous benefit to a practice -- provided you avoid a few potential pitfalls.

"If you're a solo practice starting from scratch, and the physician has some business acumen, it's probably a luxury item to start," said Michael O'Sullivan, a health care consultant in Bow, N.H. "But as you find your time is consumed with busywork, it may be more cost-effective to delegate."

Ideally, the first person you hire would learn the nuances of the practice as it grows, earn your trust and assume the office manager role once you need to create the position.

James Morris, MD, a general surgeon in Lebanon, Tenn., started in solo practice with one employee who helped with everything. The practice grew to three physicians and five employees, with the original employee assuming the role of office manager.

"Once we were big enough, somebody had to oversee everything," said Dr. Morris, who went back to solo practice earlier this year and still has the same employee as office manager. "You just start to feel like, 'Man, this is overwhelming.' "

Thomas Weida, MD, a family physician in Hershey, Pa., said that at his former practice, he and his partner started looking for an office manager once they were busy enough to warrant three caregivers.

"When we didn't have an office manager, we were reluctant to fire someone we felt we should because we didn't want to go through the hiring process," said Dr. Weida, who now is medical director of an academic practice and associate professor at the Penn State College of Medicine. He also is the vice speaker of the American Academy of Family Physicians.

Some employees in smaller practices assume the role by default, either because they have been there the longest or they have learned the more difficult duties, such as billing and coding. This sort of job classification also sets a pecking order, one that a new employee can disrupt, consultants said. An office that creates an office manager position and hires someone new to fill it might cause an internal power struggle, they said.

Of course, you also want to make sure the person you hire is ready for the job. In a small office, the duties might not actually differ, but the title change could send the employee on a power trip, said Ed Bennett, a consultant based in Hendersonville, Tenn.

"You should have a budget," he said. "You shouldn't pay someone to be an office manager and sit there and look pretty. [Whoever you hire] should be a working manager."

Of course, handing over the administrative reins also doesn't mean removing yourself completely from the equation. While the office manager probably would have the authority to hire and fire office staff -- after consulting the partners in the practice -- many physicians set expenditure limits, above which the manager needs physician approval. After all, the office manager's role is to streamline operations, not take over the practice.

"This person only should be an intermediary," O'Sullivan said. "The physician still should maintain signature authority, sign each check and review each bill."

Mike Norbut covered practice management issues during 2002-06.

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