Sunday, May 22, 2011

When to Add a Hospice and Palliative Medicine (HPM) Physician to your Practice

Most hospice and palliative medicine (HPM) programs and practices are experiencing growing demand for their physician services. These growing pains, obviously, can put a strain on current staff and the practice's infrastructure. A physician practice that is stretched beyond capacity because of an unfilled position cannot carry the patient and on-call load of a larger group for an extended period of time. The overtaxed and overwhelmed physicians are prime candidates to leave the practice, seeking opportunities where they can find better control over their workload. In other words, unfilled positions beget unfilled positions. That is why turnover is often referred to as the "silent killer" of a practice.

One of the most challenging tasks for a HPM medical director or practice manager is determining how many physicians are needed to staff the program. Since most HPM practices do not generate revenue greater than their compensation, knowing when to add a full-time physician is not an easy decision to make. But it is important to consider the costs and lost revenue associated with an unfilled position as well as the salary it takes to fill it. Take a hospital inpatient palliative care consult service, for example. A 2008 study by the National Palliative Care Research Center found that savings from palliative care consults for hospital inpatients ranged from $1,500 to $5,000 per admission. A palliative medicine physician who performs 40 such consults per month will produce savings of at least $60,000 per month for the hospital. Or take a hospice program with a palliative care consultation service and a physician making home visits to palliative care patients. One-third of those patients can be expected to transition to the hospice benefit, generating, on average, $1,500 in hospice revenue per patient. An HPM physician visiting 30 patients per month on the palliative service will produce $15,000 in patient service revenue for the associated hospice.

While these guidelines are handy in building a case, alone they do not make a clear case for when a physician should be added. Nor will the conceptual approach, projecting the work for a time period (e.g., 5,000 home visits/year) and dividing that projection by the amount of work performed by one FTE HPM physician (e.g., 920 home visits/year). Careful consideration of several other factors will also enhance the decision-making process: use of non-physician providers, such as nurse practitioners; variation in workload (need to staff higher than the average to address spikes in service demand); expectations around nonclinical commitments that may include administration, teaching and research; and the need for off-hours coverage, vacations and the like. The right timing in adding a physician to a HPM practice will likely accelerate success. Mistiming will stymie program (and practice) growth. In future posts we will look more closely into effective ways to attract the right candidates to your practice.

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