Business

Investing in employees: It pays off

Even with expenses rising, experts say it's worth it in the long run to make sure you give your employees fair pay, training and other benefits to create a good working environment and keep employee turnover down.

By Lisa Holton, amednews correspondent — Posted Feb. 14, 2005

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When it comes to hiring and keeping good employees, Lawrence E. Schilder, DO, sees one important similarity between his Joliet, Ill., hematology/oncology practice and the 1991 Chicago Bulls. That was the first of six Michael Jordan-led NBA championship teams, after Jordan had spent his first six seasons in the league accumulating individual accolades, but no title.

"I see us following the Michael Jordan model," Dr. Schilder says. "He couldn't win a world championship until he could make the people around him successful."

To do that, Dr. Schilder has made a steadfast commitment to providing health care benefits, a 401(k) plan and profit sharing to staff members. Dr. Schilder, who is also a professor of clinical medicine at Chicago's Northwestern University Medical School, realizes that his dual roles as an educator and a practitioner at locations nearly 50 miles apart make talented staff crucial. Therefore, he's willing to pay for the best.

"Some doctors tell me, 'Larry, you pay your employees too much. That's your money, not theirs,' " Dr. Schilder says. "I tell them that it's our money. They're just as responsible for helping me grow my practice as I am. ... You need to realize that staff is critical to growing a practice."

With rising health insurance, liability insurance and other operating costs, it might seem as if the most prudent move would be to cut employee benefits and salaries to save money for your practice.

But many experts join Dr. Schilder in saying that, for the sake of long-term financial health and office morale, it could be better to find ways to keep your staff happy and motivated. And it doesn't always have to come at the expense of your practice's bottom line.

Perhaps the strongest financial argument for retaining quality employees is that the cost of turnover, experts say, is higher than the cost of keeping good workers. While surveys vary on how much it costs to recruit an employee compared with retaining one, they generally agree that recruiting costs more.

Retaining employees can be especially troublesome for physician practices, which are in a particularly competitive market for hiring, going against hospitals and other health organizations.

According to Judy Bee, a consultant with La Jolla, Calif.-based Practice Performance Group, a management consulting and continuing education firm: "Recruiting support staff, from front-desk receptionists to clinical workers, has gone from very hard to horrible. Income to physicians continues to tighten while salaries of good people keep going up. Medical practice has always been an interesting combination of technical and service skills, and that's tough to find."

In fact, with the economy's slow recovery, turnover rates in the health care industry are heading up. The Bureau of National Affairs, an independent legal publisher based in Washington, D.C., reports that health care turnover was up 1.1% between January and June 2004, the highest of all industries measured.

Michael D. Brown of Indianapolis-based consultant Health Care Economics puts it this way: "If I could preach anything, the biggest practice issue doctors face is employee turnover. And it's because they don't spend enough time being innovative in the way they compensate or treat their [current] employees.

"There's no question doctors are getting squeezed, but the investment you make in staff can either help you fly or keep you stuck in place. I think doctors are going the opposite way on the question of pay and benefits -- instead of cutting them, they should be increasing them."

The opportunity to advance

Yet throwing money and benefits at employees isn't the only answer to keeping great staff in place.

Brown says merging patient and staff requests for flexible scheduling could be helpful in retaining workers. Brown says most workers -- particularly working mothers -- prefer flexible scheduling that suits their lifestyles and provides more challenges on the job. So in revamping their hiring and recruitment practices, physicians need to re-evaluate the service hours their patients prefer and then build staff schedules around them.

Some workers might want to do job-sharing; others, a four-day, full-time workweek. Creative scheduling will lead to creative solutions for staffing that might help recruitment and retention.

Experts say doctors also need to create a pleasant work environment that offers chances for advancement and training and provides other performance incentives as well.

One example of that approach is Southern Eye Associates, a surgical eye care practice based in Memphis, Tenn. According to Tom Lewis, a consultant to the practice and the husband of ophthalmologist M. Cathleen Schanzer, MD, chief surgeon and founder of the practice, Southern Eye keeps an extremely low employee turnover by creating a fun work environment with market-leading benefits, plus a full-time focus on staff training and team building.

"Recruiting great staff is a tough problem any way you look at it, but the biggest determinant is creating the kind of workplace people want to join," Lewis says.

Most of Southern Eye's hiring comes at the entry level -- mostly through employee referrals. This assures that the majority of promotions come from within. Lewis says the practice pays for 100% of employee health care benefits and offers retirement benefits to its staff. "It's definitely tempting" to offset some of that cost on employees with rocketing health care costs, but it's holding the line for now, he said.

The practice's Blue Star program allows staff members at all levels to recommend fellow employees for awards like movie gift certificates for "doing something helpful" for patients or contributing in some other way to make the practice better.

At the same time, Southern Eye Associates also has joined the "living wage" movement in Memphis, guaranteeing that Southern Eye will not pay less than $10 an hour to its lowest-wage employee.

All of this has helped the practice grow. From one physician 14 years ago, Southern Eye has two full-time ophthalmologists, three full-time optometrists and a staff of 40 employees.

Training is critical to the practice, with each employee receiving training weekly in some aspect of his or her job. There is a monthly group training session for general staff at its onsite training center. "We also do a quarterly retreat and have lunch together and go through some team-building exercises," Lewis says.

"I think the most successful practices are where both physicians and staff have a voice and an opportunity to improve the practice and their careers," Lewis says. "We try to do that here."

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ADDITIONAL INFORMATION

Start with recruiting

Rethink the personalities that you want in the practice. It's obvious that the skills of front-desk personnel, coders and business staff and clinical support are very different, but Michael D. Brown of Indianapolis-based Health Care Economics sees the need for different personalities behind those jobs as well. "If I'm helping a practice recruit a front-desk receptionist, I go to businesses that put workers in front of the public. I go to grocery stores, restaurants, clothing stores, places where you need people who can deal with the public effectively and in a friendly way. We actually approach people who are doing the best job in those settings." Judy Bee, president of Practice Performance Group, a La Jolla, Calif.-based consultancy, says she has recruited waiters and waitresses for customer contact jobs at practices. She also thinks that physicians should look very closely at older workers who have "a more motherly or fatherly approach" to patients when they walk in the door.

It all starts with the job description. In many practices, it's up to the office manager to cobble together a want ad for the Sunday newspaper's classified section. In the highest-turnover jobs, it tends to be the same ad that's been used for years. Sharon Andrews of Pensacola, Fla.-based DermResources, a consultant to dermatology practices, encourages practice leaders to consider the value of reviewing job descriptions when a single position opens or a broader expansion is in the works. "In an existing practice, we try to have the person currently in the job write the [job] description. It's usually a real eye-opener, because you find that the tasks being performed may be necessary but completely outside the perception of what you thought the job was. You may also find out that no one is doing the job that really needs doing. In any event, it allows you make adjustments to run your office better."

Revalue the resume. Andrews says hirers need to raise their standards on resumes. "It's a potential hire's first impression. Even for a lower-tier hire, you're right to insist on clear language, correct punctuation and honest information." Resumes, however, are merely a first step toward confirming the best candidates. Bee and other experts stress the necessity of background checks through a designated office staffer or services that do such checks for a fee. But employers need to realize there are federally mandated limitations on what former employers can say.

Offer incentives for staff recruits. Physicians should consider giving bonuses to workers who successfully bring new staff in the door, experts say. Why? Because employees have more at risk when they bring friends and acquaintances into their workplace, and the best ones tend to screen carefully. Also, you'll save a significant amount of money on recruitment advertising. Staff bonuses can be cash, gift certificates or floating days off.

Have a training regimen in place. Prospective employees worth their salt are going to ask about training and advancement, experts say. Training is a huge practice management issue as well -- having a good on-staff training system allows employees to know a variety of jobs in a pinch and allows for smooth operations when someone is sick or on vacation. Physicians also should try to fund outside training for talented staff as much as possible to increase the skill base of the practice as a whole, experts say.

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