Value

Venezuela, Rice Farmers and Doctors in Dallas Redux

In light of Fidel Castro’s death and the news that Venezuela is issuing new, higher-higher denominations of currency due to the triple-digit inflation that reduced the value of the country’s largest note to two U.S. cents, I’ve decided to republish an updated version of the following, popular blog post.

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Models. No, not the skinny kind in a magazine. But conceptual frameworks. Like global warming “models” or even Obamacare.

According to a Wall Street Journal article, U.S. rice farmers are raking it in on exports to Venezuela. Hugo Chavez’s legacy of socialism, in which large farms were nationalized, broken up and “redistributed,” together with food price controls resulted in the destruction of its farming industry. Similar top down management continued by his successor, Nicolas Maduro, ruined the beef, coffee, steel and sugar industries.

Humans are complex. Our interactions are complex. Outside of basic urges, like the drive to survive, we can’t, especially on a large scale, be modeled by policy wonks and other useless idiots.

Those who were surprised that employers turning to part time workers and temps to escape Obamacare were clueless.

Those who think that ACOs and hospital-centric healthcare have a long term survival rate are equally blind.

The key for doctors in Dallas and Des Moines and Detroit, and across the country, is to develop strategy that increases your chances of professional and economic survival in both the likely short lived hospital-centric world and in the physician-patient-centric one to follow.

Those in favor of Obamacare claim they did it to help the uninsured. Chavez and the Chavistas, like Castro, claimed that they took the steps they did to help the disenfranchised. But the disenfranchised have become even more so and everyone is suffering.

Comment or contact me if you’d like to discuss this post.

Mark F. Weiss

www.weisspc.com

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Thriving

Are You Protecting the Right Turf?

Male hummingbirds, those cute little avian rockets, are absolutely vicious when protecting their turf from other males of their species. They’ll fight to the death.

But for physicians, protecting your turf requires a more balanced approach. Especially when it comes to deciding what to protect.

For example, some physicians believe that they will be able to forever protect the four walls of their specialty from encroachment by other specialties or that ever changing market forces, what Joseph Schumpeter called “creative destruction,” should never impact their territory. That’s wishful thinking at best.

On the other hand, many medical groups have developed significant innovations that create value and can be protected. Innovation can remain proprietary to protect your group’s competitive advantage. Or, it can be licensed to other groups. Of course, this means that the creators must take the time, devote the effort, and, yes, make the investment, to protect their rights in those innovations.

It does little good to glorify the past or to try to stop cold major market forces. Some defense is, of course, required, but in the long run, there is more profit (and sanity) in innovating the future.

Comment or contact me if you’d like to discuss this post.

Mark F. Weiss

www.weisspc.com

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Governance

Medical Group Termites

Perhaps you’ve carefully structured your medical group’s relationships with hospitals, referral sources and other influencers. But did you pay attention to what’s going on inside your practice’s own house? Have you built a wonderful structure that’s being eaten up from the inside out by the group member equivalents of termites and wood rot?

It’s my experience, and it’s becoming an increasingly regular experience, that medical groups fail more often from problems within the group as opposed to solely from competition or as a result of attacks from outside of the group itself.

These problems range from group members whose misfeasance or malfeasance bring disrepute, to group members who engage in malicious activity outside of the pure scope of medical practice, to group members who actively consort with the hospital or a competitor to destroy or co-opt your practice.

None of the protections that are normally built into relationships between groups and outside parties are aimed at protecting the group from these internal risks.

To do so requires a different series of approaches starting with screening potential group members, whether employees or owners, on personality and interpersonal attributes as well as on medical expertise. It requires carefully evaluating, and not just on an annual review type basis, the members of your group and disciplining, or if required, terminating the “termites” before they destroy your group. It requires an entirely different set of protections built into your group’s internal documents, your shareholders or partnership agreements, employment agreements and subcontracts, in order to protect against more than what even those groups who are “benchmark to best practices” consider relevant. And it requires a coordination between those internal actions and the group’s relationships with hospitals and other facilities.

One disgruntled or malicious physician can destroy your $50 million a year business. Preventing the problem presents one of the best returns on investment you’ll ever receive.

Comment or contact me if you’d like to discuss this post.

Mark F. Weiss

www.weisspc.com

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