How Medical Practices Can Resolve Conflict between Physician Partners

Medical practices tend to suffer from role ambiguity in several relationships. Last week, I wrote about the challenges that result from the physician's roles as both owner and frontline worker, which have their most obvious impact on the physician's relationship with the practice administrator/manager. Here, I'm going to address the relationship that is often most frustrating to physicians: the business relationship with their partners.

Part of what makes things difficult is that it is not generally apparent that the partners have at least three relationships with each other: professional, personal, and business. Most often, the professional and personal relationships function well; the group would never have coalesced otherwise.

Problems arise, however, when it comes to the business relationship between partners. People who are otherwise congenial and in synch are often surprised that they view space, personnel, profitability, technology, and governance in very different ways. It is an excellent example of the truism, "It is not what you don't know that hurts you. It's what you think you know and are wrong about."

To drill down further, problems often arise between physicians and the managing partner at a practice.  Managing partners generally fall somewhere on a continuum between two extremes.

One extreme is they serve as the managing partner in name only. This is always the most senior physician in the practice. He likes the title but has no interest in the work of being responsible for the business of the practice.

This is never a good situation. In the best case, the practice drifts, with no one preparing for the future or dealing with problems in the present. The next best scenario is for other partners to try to fill the power and leadership void, which produces significant conflict that is never addressed or resolved. The most common outcome is a combination of the two: drift and turf wars.

The other extreme is the autocrat who neither seeks nor accepts input from the other partners. The other partners participate in profits, but otherwise function as employees. If the autocrat is a good businessperson and a good physician, this is not necessarily a bad situation in the short-term and mid-term. Many physicians are more than willing to abdicate a significant amount of decision-making authority so long as their income requirements are met and they get to focus on the practice of medicine.

The unavoidable problem with an autocrat is that no one is developing the skills to replace her. The practice will have a hard time surviving her departure or retirement.

A managing committee can provide better business outcomes and minimize business issue conflicts between the partners. Different partners will naturally have different interests. The critical task is to make sure that each business function is the explicit responsibility of one, and only one, partner. There should be neither gaps nor overlaps in authorities.

The practice will still need a managing partner, whose responsibility it is to broker compromises and resolve disagreements. The ideal situation is for this to be a rotating duty so that everyone understands the difficulty of the role.

It will also be necessary to decide how the management duties are to be compensated. Some jobs may be bigger than others, and some physicians may choose to opt out of management responsibilities. The negotiations may be difficult, but agreement can be reached.

The real challenge is in consistently honoring the delegated authorities. For instance, the partner in charge of equipment has the final decision on which cell phones the practice provides and how often it replaces them. He should certainly accept input on the decision and should be wise enough to recognize a groundswell of opposition, but no one else should be allowed to authorize, purchase, or install any equipment the equipment partner has not approved.

The managing committee, properly executed, is the best solution for practice governance: the job is broken into manageable pieces, leadership is developed in at least most partners, every business function has a designated champion, and every partner who wants it has authority over some part of the practice.