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There are three compelling reasons why it is time to change the way physicians are recruited. They are:

  1. Healthcare reform
  2. Projected supply shortages
  3. Deficit reduction

Why?  Now more than ever, the quality, the mix and cohesiveness of medical staffs will make the difference between exceptional success or becoming a “me-too” afterthought in the marketplace.

Today, physician recruiting is transactional, not strategic.  Physicians, who should be at the top of the healthcare food chain, are treated like a commodity in the recruiting process.  Many external recruiters are filling “orders” without any idea of an organization’s values, culture or long-term strategy.  This approach will not work in the current (evolving) healthcare environment.

These three regulatory and market forces will propel dynamic disruptions in the healthcare market.  They will change—are changing—the traditional relationship between hospitals and their medical staffs.  Gone are the days of cottage medicine—a mix of small groups of solo practitioners.  This model has given way to larger single and multi-specialty groups that are, in steadily increasing numbers, being acquired by health systems and hospitals.

The cost of physician turnover is substantial and this will face intense scrutiny as hospitals focus on managing costs. 

Medical staffs in the vast majority of U.S. hospitals were built incrementally, on a piecemeal basis.  Doctors self-recruited or they were brought in by physician groups.  The hospital’s role frequently was that of a banker, providing income guarantees and relocation assistance.  

In some hospitals, in some communities, more attention was paid to a short-term objective—a “butts in the bed” mentality that produced near-term revenue gains without consideration for longer-term consequences.  Most physician recruiting was done on a contingency basis, meaning the recruiter got paid if their candidate signed a contract to practice for their client. Most recruiters had no economic incentive to worry about cultural match or whether the candidate would remain long term.  They were rewarded (paid) to get their candidate to the client first, ahead of the competition.  There was no profit for being second which meant that far too many recruiters practiced “don’t ask, don’t tell” recruiting.  One former physician recruiter described the process as “throwing a bunch of resumes at the client, and hoped something would stick. The recruiters who were really successful worked on volume.”  There were good recruiters, but in the 1980s and 1990s, “hit and run” operations moved into the market.

Over time, the transactional contingency recruiting approach was added to the long list of misaligned incentives.

Market forces and system integration require that health systems and hospitals begin to use the same research and candidate screening methods that are employed by cutting-edge executive recruiters who, increasingly, are being held accountable by clients, for producing long-term value. 

The successful physician recruiting model in the evolving healthcare economy will:

  • Focus on long-term client relationships.  Recruiters will be valued partners who will be part of the medical staff development strategy.  They will form a deep understanding of an organization’s values and its cultural DNA.
  • Shift to behavior and values interviewing techniques and focus on matching personalities with other physicians and employees in the service line. The same rigor applied to executive recruiting will be integrated in recruiting new physicians.
  • Emphasize accountability/shared risk terms.  For example, recruiters should provide longer-term placement guarantees.  The 90-day or six-month placement guarantee in the world of physician recruiting is really no guarantee at all since few physicians leave within the first year.  The cost of physician turnover is enormous.

Physicians, like senior leaders, should be treated not as a commodity but a valued asset.  Medical staff recruiting should mirror the effort of best-in-class executive search models.

© 2012 John Gregory Self