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Protecting One of Your Most Valuable Assets – Your Employees

Protecting One of Your Most Valuable Assets – Your Employees

Several studies show that the total cost of losing an employee can range from tens of thousands of dollars to 150 percent of the employee’s annual salary. There are also the “soft costs” of losing an employee, including lost productivity and lower employee morale if the practice incurs high turnover rates. According to a survey by the Medical Group Management Association, 50 percent of respondents reported that clinical support staff positions, such as nurses and clinical assistants, had the most turnover. When these employees leave a medical practice, they may also take with them valuable, confidential information, including patient lists, fee schedules and vendor contracts.

From a legal (and practical) standpoint, it is very difficult to prevent an employee from leaving a medical practice, but you can implement several strategies to limit the adverse impact.

First, for certain “high-level” employees, the practice can require each employee to sign a non-compete agreement. A typical non-compete agreement would prevent the departing employee from working in a competing business for a certain period of time within a designated area. For a non-compete to be enforceable in Alabama it must be reasonable as to geographic scope (e.g., the service area of the medical practice) and as to duration (e.g., up to two years is presumed reasonable). Further, the non-compete must serve to protect the practice’s “protectable interests,” which includes the practice’s confidential information (e.g., pricing and patient lists and vendor information) and specialized training provided by the practice to its employees. A non-compete should only be used for employees that hold a position “uniquely essential” to the management, organization or service of the practice. Accordingly, a properly drafted non-compete for an administrator or other high-level employees should be enforceable, but a non-compete should not be used, for example, with a receptionist. Further, in Alabama non-compete agreements cannot be used with professionals, which have been defined by the courts to include physicians and physical therapists. Other clinicians that exercise independent, clinical judgment may also fall within this “professional exemption.”

Second, each employee (or at least the physicians and other “high-level” employees) of the practice can be asked to sign a non-solicitation agreement restricting the employee from “hiring away” other practice employees upon their departure. Non-solicitation agreements are common in physician employment agreements, but can also be used for other employees. A typical non-solicitation provision would read: “Employee agrees that, during the term of his/her employment with the Medical Practice and for a period of one year following termination of employment, regardless of the cause of such termination, Employee shall not, directly or indirectly, through any individual, person or entity, without the prior written consent of the Medical Practice: (a) solicit, induce or attempt to solicit or induce away, or aid, assist or abet any other party or person in soliciting, inducing or attempting to solicit or induce away any employee of the Medical Practice, or (b) employ, hire or contract for services with any employee of the Medical Practice, or any person who was an employee of the Medical Practice during the six (6) month period immediately prior to termination of the Employee’s employment with the Medical Practice.”

The final option to consider is a confidentiality agreement with employees. This type of agreement prevents a departing employee from retaining or using any of the practice’s confidential information after leaving the practice. Confidential information can be defined broadly to mean any sensitive or proprietary information of the practice, including all business or management studies, patient lists and records, financial information, trade secrets, fee schedules, and employee and operating manuals. A strong confidentiality agreement will become especially important if an employee leaves a medical practice to work for a competitor.

Howard Bogard is an attorney with Burr & Forman LLP and is the Chair of the firm’s Health Care Industry Group. Burr & Forman LLP is an official partner with the Medical Association. 

Posted in: Management

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Paying More Money Is Not the Best Way to Retain Great Staff

Paying More Money Is Not the Best Way to Retain Great Staff

Medical practices are painfully in need of keeping their top employees. The time, costs and dangers of recruiting replacement personnel are just part of the issue. Loss of key team members negatively impacts patient care, practice profitability, and staff morale. All administrators agree the retention of a trained, well-performing and mutually cooperative staff is a key to success in medicine. How do you increase your prospects of keeping your “keepers” so that you lose only the ones who needed to go anyway? There are three secrets to success in this area and none require pay raises or bonuses.

Most important is to show them that you respect them. Make them feel valued by your praise of their efforts and character. Try to “catch” them doing something good. Take an employee to the office of another physician in the group and praise some special thing they did recently. Prompt the physicians about special employee efforts and send them off to find and praise the staff member. Write key staff notes of thanks for their sacrificial efforts. Set aside time each week to praise one to three members of your team. Conduct “stay interviews” with select team members. Also, the physicians and practice leadership should be aware of the circumstances in their life. Do they have a child excelling at academics or athletics, are they planning a special vacation, are they approaching empty nest status, are they caregivers to parents or other family members, do they have a special hobby they enjoy discussing, are they saving for a major purchase like a vehicle, boat, or home?

Caring about the lives of your team affirms their value to you. Giving them a $500 bonus deposited into their joint checking account is a currency over which they may have limited control and when it is spent, it is forgotten. Giving them a handwritten note or sincere verbal praise is a “currency” they can keep for their very own and use again and again as they replay the message in their minds. The praise costs your practice a little of your time and a modicum of empathy.

After a culture of merited praise is established, it is easier to correct or discipline them when necessary. Ignoring mistakes or poor conduct is a sign of not caring about the person. Think of the influential family members, teachers and coaches in your life. Weren’t they candid with you about times when your efforts were not your best? If the staff rest in the certainty of your gratefulness for them, they can handle the truth about poor performance from you better. Always praise their character and criticize their actions. In other words, speak to the actions, but don’t attack their character. Avoid a “compliment sandwich” where you say something nice, slip in the problem, and then end with another positive. Be brief, be clear, be firm, but be nice.

New employees need some corrective discussion as early in their employment as possible. Not only is there usually an area for enhancement, but it establishes that you will exercise the right to address them when you deem necessary. For the millennials in your office, this discipline may come as a great shock. They were raised in an era when every child received a participation trophy just for showing up, and as children, they were assured they could be anything they wanted to be. If there were problems at school, their parents went to the school and took care of it for them. Now you are telling them they are special but not in a good way, and their only trophy may be dismissal if the behavior continues. This might be a difficult message to absorb, but you owe it to the great staff to communicate it in a timely manner.

At a recent practice management roundtable, we discussed the fact that some medical staff members underperform until the leadership assigns part of their duties to the better performing staff, so that things get done. Permitting this transfer of work, is unfair to all staff and must be remedied.

With a balance of praise and discipline in place, have some fun at work! Every holiday is a good time to have fun. At Christmas, let them have a contest to decorate a door. For Thanksgiving let them write something about each member of their work area for which they are thankful. Compile the results and share with the staff in a lunch meeting. Halloween, the start of football season, Groundhog Day and anything else is a reason to celebrate. Have each bring a baby photo of themselves, and let the team guess which baby is the staff member, let them send in photos of what they did this summer and have a collage review in the fall of the pictures with narrative by each staff to share the joy, take them bowling, have a new baby “pool” where all can guess the delivery details of an expectant mother on the team, and select secret pals among the staff with a low limit on any expenditures. The point is to permit them to have fun at work. You do not have to entertain them, just give them permission to entertain themselves.

It is essential medical practices provide a fair salary and benefit structure to their staff. Underpaying your people is not compensated by the provision of a good work environment. However, remember people accept a job for the initial pay and benefits, but they remain in a position because they feel appreciated, know their best efforts are expected, and they are encouraged to have fun at their work. Make your practice a place where these three things are true, and you will have a stable, patient-caring and happy staff. It will make everything else you have to do so much more enjoyable.

Article contributed by Sae Evans, Maddox Casey and Jim Stroud, Members, Warren Averett Healthcare Consulting Group. Warren Averett is an official Gold Partner with the Medical Association.

Posted in: Management

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“Physician Leadership” Must Never be an Oxymoron

“Physician Leadership” Must Never be an Oxymoron

If there has ever been a time in the practice of medicine when leadership was needed, it is certainly now. Just a few of the challenges facing practices include:

  • Payer encroachment on medical decision making is increasing;
  • Payments for health care services are declining;
  • Utilization review processes question the extent of treatment provided;
  • Aging physicians in the U.S. want a lighter work schedule;
  • Medical staff are more inclined to frequently change jobs;
  • Patients take an increasingly unappreciative attitude toward the medical profession; and
  • The payment architecture for health care services changes often enough to make it nearly incomprehensive.

While there are many elements needed for navigating this maze, physician leadership is the most essential.

In future issues, we want to address the role of leading your physician partners, the leadership of your employee team, leadership in your medical community, your impact on your patient population, and leadership outside of your profession. However, leadership in all areas begins with effective leadership of yourself.

Because the Healthcare Division of our Firm is singularly devoted to the provision of services to physicians and their practices, we have the opportunity to regularly observe hundreds of physicians in their roles within their practice. Some are natural leaders, while others have made themselves into the leaders needed by their group and some have assumed leadership but are not truly ready for the role. To be a leader, you must have the right perspective, clear personal goals and an abundance of wisdom.

The foundation for leadership readiness is found in a perspective that your purpose is to serve those you lead. In the opening words of Rick Warren’s book, A Purpose Driven Life, the author begins with a reminder that “it is not about you.” If you believe that your environment exists to serve you, your decisions will be selfish, your judgments self-serving, and your appetites insatiable. This belief cannot be concealed, and it is very distasteful when observed by your partners, staff and others. However, when a physician of supreme abilities, abundant blessings and high regard behaves selflessly, the esteem in which they are held is increased, and a resulting willingness to follow their lead is instilled. This means they know the needs of those around them and possess a healthy empathy toward their fellow physicians, employees and others.

Those who have a magnetic leadership ability also have a clear vision of what they want to achieve. Their roles as a spouse, parent, grandparent, child of their parents and sibling are marked by intentional goals and plans to achieve those goals. They have fitness and health aims, personal hobbies and recreational goals, and faith-based priorities as well as their medical practice plans. Rather than having to insist on followers, those around them follow by admiration of their balanced lives, clearness of direction, and discipline to stay on task in their pursuits.

This leadership by respect rather than by position is discussed in The 360 Degree Leader by John Maxwell. This pursuit of goals must be balanced. For example, the young physician who is so committed to parenting that he or she wants to coach their child’s soccer team is appreciated for their success in all realms of life if they are also the top producer at the clinic, have expanded their hours to see patients before normal office hours and are working on their afternoon off to make up for lost production.

Given the same scenario, the doctor/coach who is the lowest producer and does nothing to supplant the production lost to extra time away from work will never receive respect for their one-dimensional enthusiasm. If they also complain about the unfair allocation of patients, errors in the practice revenue cycle and the need for greater compensation, they are assured of disrespect from their staff and peers.

The servant leader must have a “healthy empathy,” and the goals of a driven physician must be “balanced.” These qualities can only be found in an abundance of wisdom built over the years. Wisdom enables you to pick the battles you should fight selectively. Patiently wait for the opportune time to engage on the issues, and calculatingly arrange the desired audience to be present as you deal with a matter. Wise actions are deliberate, not impulsive. Some wisdom comes from past mistakes, so always review your own handling of tough situations for ways in which you could have improved. Wisdom is also found in seeking the counsel of others, especially those outside your practice.

Future leadership articles will speak to the various areas calling for physician leadership, but self-leadership must be at the core.

Article contributed by James A Stroud, CPA, D. Maddox Casey, CPA, and Sae Evans, CPA, with Warren Averett CPAs and Advisors. Warren Averett CPAs and Advisors is an official Gold Partner with the Medical Association.

Posted in: Leadership

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