Physicians News Health news for doctors and patients.
By Denis J. Lucey 3rd, M.D.
In Pennsylvania, the rapid pace of institutional mergers, acquisitions and affiliations is paralleled by the increasing participation of physicians in multiple organizational affiliations (IPAs, PPOs, PHOs, etc.), the rapid development and disintegration of physician partnerships, and changing alliances among physicians and institutions. In both institutional and professional situations, organizational development interventions can be useful at any stage, but the timing and types of intervention should be appropriate to the circumstances. For example, in mid-1997, the urgency with which physician/organization transactions and interorganizational transactions are initiated and consummated may be driven chiefly by a need to control thousands of covered lives and an idealized geographic distribution of practices and affiliated institutions in the presence of evolving competing systems. There is intensive due diligence around the current and past economics of practices and hospitals, but doing numbers of deals in the right locations often seems to be more important than securing optimal cultural fit, or considering leadership succession in a group, or anticipating ease of integration into a network.
Organizational development is attentive to these latter examples of problematic aspects of emerging health care systems. There are at least three phases for organizational development interventions. Organizational development activities can be deployed pre-deal, during the transaction, and post acquisition or affiliation or consolidation.
Consider the example of a 300 bed acute care hospital electing to acquire new or mid-career family practices, to choose among acquisitions of several soon-to-retire internists, to select for affiliation one of two nearby 200 bed hospitals with different service mixes, reputations and reported management styles. A place exists for very early attention to OD principles and practices. At the outset, this kind of due diligence can improve partner selection. With respect to both hospitals and physicians, a mismatch can be avoided and later embarrassment diminished when talks collapse. (Or in a worst case, embarrassment because the transaction is completed, a rocky relationship ensues and divorce proceedings are begun.)
What organizational development efforts are useful in early discussions? An initial assessment can explore congruence of goals, a complementarity of expectations of productivity, similarity in decision making and communication styles. One can observe the earliest signs and symptoms of dissonance or misfit in spite of verbal agreement, for example, alternative nonverbal cues, covert decision making and latent conflict. These observations can be valuable.
Addressing organizational and behavioral issues alongside legal, accounting and practice management issues may delay due diligence but can preclude missteps and if the transaction proceeds will ease integration and enhance provider unit function. This can help to dampen the productivity declines and the expense increases often found post-transaction.
If the revolving door of practice acquisition offers and “affiliation” talks fails to slow enough to allow a thorough organizational assessment, all is not lost. Consider here the case of the specialty group practice with excellent reputation, growing volume, and significant managed care experience. Two or three (A, B, or C) of the emerging dominant networks in the region begin discussions with this group relative to employment, capital improvements, for practice and research and for practice relocation. The group decides system B is the best fit, but not all important questions can be answered in the initial or revised agreements proffered by system B. During the transaction process, attention to behavioral issues can be useful again. A behavioral/organizational perspective can add value in negotiations.
Participation in the negotiating process affords a first hand look at some of the roots of behaviors more evident or obvious later in the post affiliation period and gives one a jump start in modifying adverse behaviors before or as they emerge. Such participation in a time of stress and conflict also supports relationship building and develops trust and respect useful in preventing or resolving later conflicts as the practice organization or integrated delivery system matures. Identification of issues and early intervention in media res means the new entity will hit the ground running. This can shorten the period of post transaction complacency devoted to organizational self congratulation after consummation of the deal, often entailing sitting back and cutting notches on the gun while productivity stalls or declines. Instead, the entity emerges already functioning at least in some parts as the new and different entity sought.
Realistically, given the current vogue for doing deals first and fast, more attention to organizational and behavioral change efforts is likely to come later. This will occur post transaction after the first signs of problems (red ink), symptoms of dissatisfaction (grumbling “it’s business as usual; the benefits haven’t materialized; the practice or the interinstitutional relationship is languishing in the doldrums”). In this phase, the specifics of the complaints should be used as clues to the underlying problems, and it is critical that the particular sort of organizational development intervention selected be appropriate to the problem. For example: The physician who realigned with a new hospital, relocated and lost a competent office manager doesn’t yet perceive the advantages of the just-installed clinical and billing and collection systems and is bristling at a CFO’s telephone query about why revenues have fallen off. Are practice and institutional cultures at variance and no synergies realized from the combination? Here, skillful assessment identifies key elements of why, and proposes a series of group exercises to communicate/elicit this self knowledge from participants. It explores feelings about this situation and it suggests alternative approaches to behavioral change in problem solving or conflict resolution.
In another situation, development of a new consolidated management team including administrators and physicians is critical. Strengths and weaknesses of individuals, their personality type, decision making and communication preferences must be identified and shared. Observation of attempts at team work can be helpful, exercises for joint resolution of problems must be introduced, a new collective modus operandi developed and progress monitored. Often administration of the MBTI and an off site retreat will be helpful in initiating this process. A third set of different circumstances may suggest executive counseling for a new senior level administrator, a medical director or a department chair. This may support an executive already seated or may be preventive and supplementary effort directed at the physician expected to assume a leadership role in the near future.
For OD to be effective in any phase of the transaction, early, mid or later, there must be comfort with the psychological foundations of managing behavioral change and acceptance of the validity of organizational theory. Some practicing physicians are particularly resistant to these theories and activities. The origins of this resistance are many. For certain physicians, psychiatry and psychology are regarded as new, unproved, or “unscientific” branches of the healing arts. Physicians now practicing were usually educated in a model placing high value on autonomy and not on team work. This model also cultivated a degree of omniscience and discouraged physicians from sharing feelings of uncertainty, anxiety or doubt. Useful in certain clinical situations, these attitudes unfortunately can be disrespectful of other disciplines. Physicians seeking and demonstrating excellence in their own sometimes narrow spheres can display arrogance about areas in which they lack competence or even familiarity. The intensity and all-consuming character of medicine often insulates physicians from changes occurring in other professions and in business and industry.
In these cases, many physicians will be unfamiliar with the extent to which organizational development principles and practices have become accepted elements in professional, educational or religious life and a fundamental part of human resources and strategic planning activities in business and industry (only the MBA/M.D. or MBA/D.O. may be a regular reader of the Wall Street Journal, Forbes, Business Week, etc.). Finally, physicians have little time, or believe they have little time, to devote to activities that by their nature (relationship building, development of trust, learning interpersonal skills) require time. Parenthetically, the usual response of organizational development practitioners to the complaint of no time for organizational development work is simple: “Pay now or pay later.”
So the task is first to recognize the value of organizational development. Don’t reinvent the wheel, learn what organizational development has done in automobile manufacturing, in the transportation sector, in financial services, etc. Second, decide when to deploy this knowledge. Better early than late, better late than never. Third, demand specific interventions for specific problems just as you would in clinical practice. Fourth, allow enough time to elapse for a relationship to evolve and a regimen to work—again, just as you would do in clinical counseling or antibiotic administration or wound healing. Fifth, from the successes and failures of this particular intervention, learn—modify when and how to intervene in the next organizational situation. The current environment ensures changing organizational circumstances revealed in each issue of the morning newspaper. The only constants are change and our need to manage change.
Denis J. Lucey 3rd, M.D., is a principal of Organizational Transformation Pertners, a consulting firm specializing in dealing with the dynamics of change in the health care industry.
