Job One is always patient safety and physician sanity. If you are careful about growth and buy-in, and you do the committee work and support everybody so that you’re firmly entrenched in the hospital as a value, it’s much safer to grow. Growing for the sake of growing, you risk overexpansion, and that’s dangerous.

—Brian Hazen, MD, medical director, Inova Fairfax Hospital Group, Fairfax, Va.

Ilan Alhadeff, MD, SFHM, program medical director for Cogent HMG at Hackensack University Medical Center in Hackensack, N.J., pays a lot of attention to the work relative-value units (wRVUs) his hospitalists are producing and the number of encounters they’re tallying. But he’s not particularly worried about what he sees on a daily, weekly, or even monthly basis; he takes a monthslong view of his data when he wants to forecast whether he is going to need to think about adding staff.

“When you look at months, you can start seeing trends,” Dr. Alhadeff says. “Let’s say there’s 16 to 18 average encounters. If your average is 16, you’re saying, ‘OK, you’re on the lower end of your normal.’ And if your average is 18, you’re on the higher end of normal. But if you start seeing 18 every month, odds are you’re going to start getting to 19. So at that point, that’s raising the thought that we need to start thinking about bringing someone else on.”

Dr. Alhadeff

It’s a dance HM group leaders around the country have to do when confronted with the age-old question: Should we expand our service? The answer is more art than science, experts say, as there is no standardized formula for knowing when your HM group should request more support from administration to add an FTE—or two or three. And, in a nod to the HM adage that if you’ve seen one HM group (HMG), then you’ve seen one HMG, the roadmap to expansion varies from place to place. But in a series of interviews with The Hospitalist, physicians, consultants, and management experts suggest there are broad themes that guide the process, including:

Data. Dashboard metrics, such as average daily census (ADC), wRVUs, patient encounters, and length of stay (LOS), must be quantified. No discussion on expansion can be intelligibly made without a firm understanding of where a practice currently stands.

Benchmarking. Collating figures isn’t enough. Measure your group against other local HMGs, regional groups, and national standards. SHM’s 2012 State of Hospital Medicine report is a good place to start.

Scope or schedule. Pushing into new business lines (e.g. orthopedic comanagement) often requires new staff, as does adding shifts to provide 24-hour on-site coverage. Those arguments are different from the case to be made for expanding based on increased patient encounters.

Physician buy-in. Group leaders cannot unilaterally determine it’s time to add staff, particularly in small-group settings in which hiring a new physician means taking revenue away from the existing group, if only in the short term. Talk with group members before embarking on expansion. Keep track of physician turnover. If hospitalists are leaving often, it could be a sign the group is understaffed.

Administrative buy-in. If a group leader’s request for a new hire comes without months of conversation ahead of it, it’s likely too late. Prepare C-suite executives in advance about potential growth needs so the discussion does not feel like a surprise.

Know your market. Don’t wait until a new active-adult community floods the hospital with patients to begin analyzing the impact new residents might have. The same goes for companies that are bringing thousands of new workers to an area.

Prepare to do nothing. Too often, group leaders think the easiest solution is hiring a physician to lessen workload. Instead, exhaust improved efficiency options and infrastructure improvements that could accomplish the same goal.

“There is no one specific measure,” says Burke Kealey, MD, SFHM, medical director of hospital specialties at HealthPartners Medical Group in St. Paul, Minn., and an SHM board member. “You have to look at it from several different aspects, and all or most need to line up and say that, yes, you could use more help.”

Practice Analysis

Dr. Kealey, board liaison to SHM’s Practice Analysis Committee, says that benchmarking might be among the most important first steps in determining the right time to grow a practice. Group leaders should keep in mind, though, that comparative analysis to outside measures is only step one of gauging a group’s performance.

“The external benchmarking is easy,” he says. “You can look at SHM survey data. There are a lot of places that will do local market surveys; that’s easy stuff to look at. It’s the internal stuff that’s a bit harder to make the case for, ‘OK, yes, I am a little below the national benchmarks, but here’s why.’”

Dr. Kealey

In those instances, group leaders need to “look at the value equation” and engage hospital administrators in a discussion on why such metrics as wRVUs and ADC might not match local, regional, or national standards. Perhaps a hospital has a lower payor mix than the sample pool, or comparable regional institutions have a better mix of medical and surgical comanagement populations. Regardless of the details of the tailored explanation, the conversation must be one that’s ongoing between a group leader and the C-suite or it is likely to fail, Dr. Kealey says.

“It really gets to the partnership between the hospital and the hospitalist group and working together throughout the whole year, and not just looking at staffing needs, but looking at the hospital’s quality,” he adds. “It’s looking at [the hospital’s] ability to retain the surgeons and the specialists. It’s the leadership that you’re providing. It’s showing that you’re a real partner, so that when it does come time to make that value argument, that we need to grow...there is buy-in.

“If you’re not a true partner and you just come in as an adversary, I think your odds of success are not very high.”

Dr. Sloan

Steve Sloan, MD, a partner at AIM Hospitalist Group of Westmont, Ill., says that group leaders would be wise to obtain input from all of their physicians before adding a new doctor, as each new hire impacts compensation for existing staff members. In Dr. Sloan’s 16-member group, 11 physicians are partners who discuss growth plans. The other doctors are on partnership tracks. And while that makes discussions more difficult than when nine physicians formed the group in 2007, up-front dialogue is crucial, Dr. Sloan says.

“We try to get all the partners together to make major decisions, such as hiring,” he says. “We don’t need everyone involved in every decision, but it’s not just one or two people making the decision.”

The conversation about growth also differs if new hires are needed to move the group into a new business line or if the group is adding staff to deal with its current patient load. Both require a business case for expansion to be made, but either way, codifying expectations with hospital clients is another way to streamline the growth process, says Dr. Alhadeff. His group contracts with his hospital to provide services and has the ability to autonomously add or delete staff as needed. Although personnel moves don’t require prior approval from the hospital, there is “an expected fiscal responsibility on our end and predetermined agreement do so.”

The group also keeps administrative stakeholders updated to make sure everyone is on the same page. Other groups might delineate in a contract what thresholds need to be met for expansion to be viable.

“It needs to be agreed upon,” Dr. Alhadeff says. “I like the flexibility of being able to determine within our company what we’re doing. But in answer to that, there are unintentional consequences. If we determine that we’re going to bring on someone else, and then we see after a few months that there is not enough volume to support this new physician, we could run into a problem. We will then have to make a financial decision, and the worst thing is to have to fire someone.”

Dr. Alhadeff also worries about the flipside: failing to hire when staff is overworked.

“We run that risk also,” he says. “We are walking a tightrope all the time, and we need to balance that tightrope.”

When you’re putting out fires every day, you don’t have the luxury and the time to look out there and see what’s happening and know everything that’s going on. [Group leaders] need to understand the importance of [long-term analysis] and how all the pieces tie in together.

—Kenneth Hertz, FACMPE, principal, Medical Group Management Association Health Care Consulting Group, Denver

The Long View

Another tightrope is timing. Kenneth Hertz, FACMPE, principal of the Medical Group Management Association’s Health Care Consulting Group, says that it can take six months or longer to hire a physician, which means group leaders need to have a continual focus on whether growth is needed or will soon be needed. He suggests forecasting at least 12 to 18 months in advance to stay ahead of staffing needs.

Unfortunately, he says, analysis often gets put on hold in the shuffle of dealing with daily duties. “This is kind of generic to practice administrators, who are putting out fires almost every day. And when you’re putting out fires every day, you don’t have the luxury and the time to look out there and see what’s happening and know everything that’s going on,” he says. “They need to understand the importance of it and how all the pieces tie in together.”

Brian Hazen, MD, medical director of Inova Fairfax Hospital Group in Fairfax, Va., says an important approach is to realize growth isn’t always a good thing. HM group leaders often want to grow before they have stabilized their existing business lines, he says, and that can be the worst tack to take. He also notes that a group leader should ingratiate their program into the fabric of their hospital and not just rely on data to make the argument of the group’s value. That means putting hospitalists on committees, spearheading safety programs, and being seen as a partner in the institution.

“Job One is always patient safety and physician sanity,” he says. “If you are careful about growth and buy-in, and you do the committee work and support everybody so that you’re firmly entrenched in the hospital as a value, it’s much safer to grow. Growing for the sake of growing, you risk overexpansion, and that’s dangerous.”

Many hospitalist groups looking to grow will use locum tenens to bridge the staffing gap while they hire new employees (see “No Strings Attached,” December 2012, p. 36), but Dr. Hazen says without a longer view, that only serves as a Band-Aid.

Hertz, the consultant, often uses an analogy to show how important it is to be constantly planning ahead of the growth curve.

“It is a little bit like building roads,” he says. “Once you decide you need to add two lanes, by the time those are finished, you realize we really need to add two more lanes.”

Richard Quinn is a freelance writer in New Jersey.

Hospital Medicine Experts Outline Criteria To Consider Before Growing Your Group