Good Governance

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Imaging providers are well aware of the many challenges that radiology groups are facing today. Considering all of the various external threats, one is reminded of the motto sometimes attributed to Blackbeard (Edward Teach, 1680–1718): The floggings will continue until morale improves. It is in this environment that many radiology groups must rethink their governance structures and processes. Many groups operate in a manner better suited to the golden age of medicine, but woefully inadequate in today’s market. Effective governance is important; it is difficult to achieve, but there are steps that you can take to improve your group’s governance. As many experts conceptualize it, governance is a set of structures, processes, and rules, established by the group. That set guides business operations within the group and with external parties, and it steers the organization toward accomplishment of its vision. It is critical to recognize that governance is not something just for big groups that have boards or executive committees. Many elements of governance are as important to a group of three physicians as they are to a group of 300. For example, if they are to make progress, even three physicians must decide how they will handle situations where they don’t all agree. Good Governance In more than 20 years of working almost exclusively with medical groups on governance issues, I’ve identified a number of obstacles that radiology groups must overcome to achieve effective governance. Three of the most important factors are overemphasis on autonomy, on individual rights, and on including all physicians in decisions. Many physicians desire a high degree of autonomy, and they want all the benefits of group practice along with all the benefits of solo practice. A preference for protecting the rights of the individual over the rights of the group is the reason that so many groups require high (supermajority) vote levels on many issues. In addition, many physicians feel that as owners of the group, they should have the right to participate in every group decision. I’ve heard several radiologists say that even if their groups included 1,000 physicians, all should meet and make decisions together. The result of these three factors is that many radiology groups fall into ineffective governance structures (Table 1).
imageTable 1. Ineffective Governance Structures
Making Decisions Two fundamental questions that every radiology group must resolve are how the group will make decisions and what group decisions will mean. Many kinds of groups have something called a dirty little secret; in medical groups, the dirty little secret is that individual physicians in the group believe that if they didn’t vote for a group decision, or don’t like a group decision, they don’t have to comply with it. Such an attitude makes every group decision subject to the individual physician’s decision to adhere to it (or not). Many groups that think that they are making decisions are really making paste: They are throwing ideas against the wall and hoping that some will stick. They hope that individual physicians will actually adhere to group decisions. If your group operates this way, it is a recipe for endless frustration. The best groups ask and answer three important questions. First, how will we make decisions as a group? Groups typically have four choices (Table 2): All decisions require unanimity; decisions require consensus; the majority rules; or consensus will be sought, but in its absence, decisions will be made by voting.
imageTable 2. Decision-making Methods
Second, what is expected of each physician once the group has made a decision? The answer to this question is crucial. Each member of the group should commit to the principle that once a decision has been made using the agreed-upon decision-making method, all physicians (whether they agree with the decision or not) will support it. That means that they will do what has been agreed to, will not sabotage it, and will continue to follow the agreement unless they can get it changed through proper channels. Third, what are physicians’ options if they still don’t like the decision? There should be only three options. One is to support the decision anyway. That’s group practice. A second is to try to change it. The proper environment for this is typically the group meeting. Physicians must keep adhering to the decision until it is changed, however. The final option is to take themselves out of the group. Physicians should commit to leaving the group rather than doing things that run counter to group decisions. In smaller groups having fewer than 10 shareholders, it is typical for all shareholders to be involved in major group issues. As groups grow larger, try as they might, it is not feasible to include every shareholder in every decision. It becomes impossible to communicate and bring everyone to the same level of understanding about issues. Further, not all group members will be willing to invest the time necessary to make high-quality decisions. Effective groups recognize that, at a certain point, a subset of physicians must be selected to make at least some of the decisions for the group. An important step in the evolution of any group’s governance is the creation of a clear outline stating who can decide what for the group. One way to make this outline is to consider the major decisions that a group faces and agree on what level of authority each element of the group’s governance will have. Table 3 shows an abbreviated example of a checklist that can be used to make these decisions.
imageTable 3. Decision Authority (Abbreviated List)
Related to the issue of authority is the need to decide how many physicians should be included on the board. In my experience, these guidelines are reasonable: For groups of up to 10 physicians, all members vote; for group of 11 to 20 partners, a board of three to five physicians is optimal; and for groups of 20 or more radiologists, a board of five to nine physicians is best. Problems in Behavior Another important function of medical-group governance is dealing with problems in physician behavior. One would think (or hope) that by the time radiologists had completed their training and begun practicing, they would have mastered not only their clinical field, but also the ability to work well with others and behave appropriately. If you’ve spent any time in a medical group, however, you know that it is a rare situation when all the physicians behave well. In my years of consulting, I’ve seen or heard it all, including physicians putting each other down in front of technologists or other staff, inappropriate conversations with hospital administrators, unsupportive comments made to those outside the group, lack of confidentiality concerning group matters, and unprofessional behavior in the reading room and beyond. Unfortunately, most medical groups do not know how to address or resolve such situations. While it is impossible to correct all issues of interpersonal conflict or inappropriate behavior, medical groups can take three important steps to improve their chances of success: Develop a code of conduct, create a system for dealing with problems in physician behavior, and conduct periodic peer evaluations.
imageTable 4. Best Board Sizes
A code of conduct contains the agreed-upon standards of behavior expected of a member of the group. It sets out, in general terms, the standards and duties that it is reasonable to expect a professional to observe. It includes, in essence, the rules of the game that the members of the organization are expected to follow. A group creates a code of conduct primarily for four reasons: to communicate what the group finds important about physician behavior and conduct; to improve the chances that the group will continue to have the freedom to govern itself; to hold errant physicians in check without making them feel that they are under personal attack; and to remove the influence of personalities and private opinions, if it becomes necessary to intervene in a situation. In developing a code of conduct, medical groups tend to focus on answering five questions. What behaviors do we expect of each other? What is acceptable to us? What is inappropriate? What are some of the unwritten rules that guide our behavior (which we should write down so that they will be universally understood)? What are the rights and responsibilities of each physician? In developing the answers to these questions, it is useful to break down the responses into various categories, including relations/interactions among the physicians in the group; relations/interactions with those outside the group (such as patients, surgeons, and hospital staff); patient-care responsibilities; participation in practice-management responsibilities; confidentiality of practice information; decision making and its consequences; adherence to legal contracts with the group; and support of group-established plans, goals, and policies. For example, a group might develop the expectations shown in Figure 1.
imageFigure 1. An example of written expectations for physician interactions within the group.
While such expectations may seem simple and self-evident to some, we have found that many physicians need to see the expected behaviors set out in black and white before they understand that they have to comply with them. If they are left as unwritten rules, many physicians will perceive the rules as optional. How do you develop a code of conduct? Many groups find that the best time to develop one is during the group’s annual planning retreat. No matter how you choose to do it, the most important step is to include all the physicians in its development. Otherwise, they will see it as something imposed and therefore will be less likely to adhere to it. If physician misbehavior is particularly acute, the group might consider a separate meeting to address just the code of conduct. If a group wants to deal with inappropriate physician behavior, developing a code of conduct is an important first step. The first question often asked after the development of a code of conduct is what to do if someone breaks the rules. There’s no doubt about it; self-governance is tough. It is made even tougher when you add that most physicians are actually conflict avoiders, and many are reluctant to be seen as judging one another. Unless physicians want to turn over control of the group to someone other than themselves, however, there is no one else who can govern their group. Groups must find a way to govern themselves, and part of governing is dealing with problems in physician behavior. One way to deal with these problems is to establish a professional-practices committee. This committee exists to consider physician conflicts, physician performance, and quality-assurance concerns for the practice. The committee will either work to resolve issues on its own or bring matters to the attention of the board for resolution. In most situations, this committee does not have the power to censure or take action against a physician. Instead, it is an intermediary process, trying to resolve the issues before significant steps are taken. A policy for such a committee can be found in Figure 2.
imageFigure 2. Sample policy of the professional-practices committee.
Peer Evaluation The group should also conduct periodic peer evaluations. I believe that when physicians are in a group practice, they are (or should be) accountable to each other. Most superior groups set up a formal peer-evaluation process for all of the physicians in the group, including shareholders. A peer evaluation process can take many forms and address many issues (clinical as well as behavioral). If you are new to peer evaluation, or if the members of the group are hesitant, set up the first evaluation so that each physician is the only one who sees his or her feedback. If you use a form to collect information, be sure to allow room for providing written comments, in addition to checking the boxes. Set up the system so that peer review is conducted annually and becomes a standard operating practice of the group. Consider using an external third party to compile the responses. Your accounting company may be a good candidate for this, since it is used to working with confidential information. Check with your attorney to ensure that the information collected will not be discoverable through any type of legal process, and make sure that the peer-review process includes both shareholders and nonshareholders. There are many other steps that you can take to improve your group’s governance and, as a result, its overall performance, but these are some key steps with which to begin. This is a make-or-break era for radiology groups. While I recognize that making these changes is challenging for any radiology group, you must always remember: If you don’t like change, you will like irrelevance even less. Will Latham is principal, Latham Consulting Group, Chattanooga, Tennessee. To receive a copy of the complete decision-making checklist or a sample code of ethics, contact him at wlatham@lathamconsulting.com.