In the 1970s, Japanese automobile and electronics companies began exporting high quality cars and televisions to the American markets. Stunned by the Japanese companies’ success, American manufacturers Chevrolet and Magnavox asked their counterparts at Datsun and Sony, “How are you doing this?” The Japanese executives replied, “Kaizen.”1
“Kaizen” means continuous, incremental improvement and the term became a management buzzword around 1980. Constantly getting better and better became an executive mantra that manifested itself in the 1980s as “quality improvement committees” in healthcare organizations across the United States.
In the 1990s, management gurus determined that there was another component to the success equation besides the focus on providing better and better services; eliminating waste. This second component involves businesses using less and less resources when producing and delivering products and services. The concept of focusing on getting better and better while at the same time using less and less resources is often called “Lean Management.”2
Applying The Principles Of Lean Management To Podiatric Practice
I believe Lean management techniques can and should be applied to podiatry practices today. In today’s healthcare environment, providing high quality care in a fast and cost-efficient manner is a recipe for success. Doing more for your patients, your employees and yourself while using less money, time and energy is the way to go, don’t you think?
Private practice podiatrists should focus on five key areas when they are at work:
1. Do a great job. Help lots of people with their foot and ankle problems in a big way. This is the most important thing.
2. Produce high quality, timely medical records. This is often how a physician is judged (and paid).
3. Code correctly. You should receive proper reimbursement for for medically necessary podiatric services (or private payment), and nothing more.
4. Achieve high patient satisfaction. The public is going to figure out that it is possible to pay someone to garner all positive reviews on Google. Strive to have all your patients leave your office with what they came for, delivered in a kind, competent, hygienic and professional manner. I still think there will soon be a outside entity that does quality reporting for consumer groups and other interested parties that looks past the “5 star” hype.
5. Grow the business. Attract more of your favorite type of patients (the ones that you uniquely can help the best). If you have fun doing what you do best, your patients will have fun obtaining wellness from you.
Ideally, private practice podiatrists will focus on the above five items as the highest and best use of their time. These are the five core functions of a doctor in private practice. We should focus on getting better and better at these five things. But, what about all the other important factors that go into creating a medical practice that delivers high quality care in a compliant, fast and cost-efficient manner? That is where out-sourcing comes in.
When birds fly in formation, they go faster but use less energy. That is what Lean management is all about. For the birds to do their best, they must come together and fly in formation. In today’s healthcare environment, that is what I recommend small practice podiatrists do.
Working Smarter In A Lean Management Style: Opportunities For Outsourcing
Doctors focused on improving in the five key areas, but also banded together and flying in formation can outsource the following functions.
Centralized Billing. How many certified coders work for you and what would happen if one of them left today? Do you know your metrics for the number of denials that one can work per hour? If you use a billing company that has a thirty-five percent profit margin, are you really being lean?
Centralized Accounting. How much do you pay your accounting firm per hour for simple bookkeeping work? Is it efficient for the highest paid people in a practice to write the checks? Would you like to tailor your reports and benchmark them against other doctors in your specialty? Could your accounting be leaner?
Compliance. Do you have on-demand HIPAA and OSHA training with a reminder system to keep everyone current? Have you hired someone knowledgeable in radiation safety, infection control, health information security, employee law and OSHA standards to come by and inspect your office on a regular basis? Does he or she follow up with you on deficient areas? Is the person responding to medical record audits trained and focused on compliance? Are you getting better and better with compliance?
Human Resources. What would happen if the person handling the on-boarding and exiting at your practice became ill? Do you have an expert to keep up with all the rules and regulations and handle sometimes delicate employee issues? How can a small medical practice possibly get economies of scale (say, a practice with five employees obtaining a similar price as a practice with 300 employees) when shopping for health insurance?
Insurance Contracting And Compliance. Do you know the name of your payor insurance representatives and when was the last time you spoke with them? Do you regularly review your contracts and negotiate rates for your most important codes? How often do you receive an invitation to be part of a narrow network? Have you ever been invited to be in a select group of providers that provides more favorable coverages and higher payments? The more providers, the merrier when it comes to insurance contracting.
Common Electronic Health Records. A common practice management system is required for many doctors to practice together in an efficient fashion. The future is data-driven. If fifty doctors can see each other’s records and practice metrics, they will learn from each other and most of them will adopt the “best practices,” causing the group to do better as a whole.
Call Center. When you check out at a high quality, efficient medical practice, do you have to stand and wait for the checkout person to get off the phone? If your staff did not have to answer the phone very often, could they provide better service to the patients in the office?
Lean Purchasing. How much are you paying for your “doctor occupation” disability insurance? Divide that amount by four to find out how much a similar group disability policy could cost. Alternately, if you could aggregate over ten million dollars in your retirement plan, your per person costs may shrink considerably.
Ancillary Income. There are a range of supplemental income opportunities available to large group practices that include: lab services; chart audit services; seminars; telehealth; surgery centers; radiology and vascular services; physical therapy; pharmacy programs; marketing agreements; real estate; and more.
Best Practices. Napoleon Hill wrote about forming mastermind groups to solve problems using the input of others interested in a common goal.3 A large group of doctors banded together and flying in formation can get better and better at providing high quality podiatry care while saving time, money, and energy.
Doctors in private practice should practice in a lean fashion if they want to maximize success. They should focus on improving the five core functions within their office and efficiently outsource everything else. In this way, they can become better and better using less and less.
Kevin McDonald, DPM practices Lean Podiatry at InStride Foot and Ankle Specialists, in Concord, NC. He is a Diplomate of the American Board of Foot and Ankle Surgery and the American Board of Podiatric Medicine.
1. Juneja P. What is kaizen? – 5 S of kaizen. Management Study Guide. Available at: www.managementstudyguide/what-is-kaizen/htm . Accessed March 18, 2021.
2. Kanbanize. What is lean management? Definition and benefits. https://kanbanize.com/lean-management/what-is-lean-management . Accessed March 18, 2021.
3. Hill N. The Law of Success in Sixteen Lessons. Tribeca Books; 1928.