uch has been written about the “products” of a successful academic department of anesthesiology: clinical care, education, research, public service and participation in the affairs of organized medicine. This issue of the ASA NEWSLETTER, however, is not about academic anesthesiology in the conventional sense but instead examines the twin engines powering academic productivity — the management of financial and intellectual resources — which are the driving forces that support the academic process. Given two departments with equally skilled and committed educators and clinicians, the one with the strongest expertise in management of financial and intellectual capital will experience far greater opportunity for academic excellence.

Background
The November 2004 issue of the ASA NEWSLETTER provided a superb overview of the challenges facing academic anesthesiology programs in the United States. Foremost among these difficulties are the problems of 1) attracting the best and brightest medical students into our specialty and 2) recruiting and retaining the best and brightest faculty members in addition to providing them with adequate resources for the educational and research endeavors they are forsaking the attractions of private practice to pursue. Causal agents often cited for this distress include the devaluation of the anesthesia conversion factor occurring with the implementation of the Medicare Fee Schedule in 1992; the introduction of Medicare teaching rules in 1996, which resulted in a 50-percent reduction in Medicare reimbursement for anesthesiologists concurrently supervising two residents; and the need to serve the relatively large percentage of underinsured or uninsured patients often found in academic anesthesiology practices.^1-4 Entry-level private practice positions are often providing better compensation than what is offered to senior professors of anesthesiology. A passion for teaching and research may easily be countered by the reality of servicing an educational debt that today averages $105,000 for graduates of public medical schools and $140,000 for graduates of private medical schools.⁵ And how many medical students are going to be attracted to our specialty if the medical school’s anesthesiology department is staffed by faculty demoralized by noncompetitive salaries and benefits, poor leadership, inadequate research opportunities and excessive clinical workloads?

Private practice anesthesiology similarly faces a host of contemporary challenges, including decreasing reimbursement, nurse anesthesia scope-of-practice battles and the availability of affordable medical malpractice insurance — and yet most of these groups have nevertheless found a way to thrive. This imperative for anesthesiology practices to evolve in response to the perpetually changing business environment is not a novel concept and has been well described by others.^6,7 Are the difficulties found in so many academic anesthesiology departments due to changes in their operational environments or to a failure to successfully adapt to these changes? To what extent is academe the victim of “unfair” environmental circumstances beyond its control, and how much of its present difficulty is due to the unwillingness and/or inability of these programs to adapt to their changing environments?

Health care is a business that has to be led and managed, and academic anesthesiology departments are not exempt from these principles any more than their individual members are exempt from the law of gravity. In fact, the importance of these fundamental principles to academic medicine was acknowledged nearly a century ago. Frederick W. Taylor (1856-1915), the pioneering industrial engineer who developed time-and-motion studies and first suggested the term “scientific management,” surprisingly did not cite titans of American business such as U.S. Steel, the Union Pacific Railroad or Standard Oil as examples of scientific management in his landmark 1912 testimony before Congress on management theory. Rather, he described the organizational efficacy of an integrated health care delivery system — the nonprofit Mayo Clinic.^8,9

Questions Academic Anesthesiologists Should Ask Themselves
The following issues deserve priority when assessing the welfare of your academic department and its respective practice environment(s) and when evaluating potential solutions to difficulties your department may be encountering:

1. The fundamentals of departmental leadership and management. Academic anesthesiology departments are in reality multimillion-dollar small businesses, and academic chairs should be selected at least in part on the basis of their possession of outstanding business leadership and/or management skills. Moreover the academic chairperson may have accepted his/her position without first establishing that he/she would receive sufficient financial and intellectual resources from the dean and the hospital to enable the department to excel. Are you satisfied with the leadership and management (two very different skill sets) of your department? If your family owned a small business, would you trust your department’s leadership to run it?

2. The most important resource: intellectual capital. Does your department have the will, and the ability, to hire and retain the very best and brightest faculty? Does it have a well-organized mentorship program to assess the strengths and weaknesses of each faculty member on an ongoing basis, augmenting strengths and correcting weaknesses? Does your department maximize the utilization of its intellectual capital by employing the strengths of individual faculty members in furthering both its strategic goals and its daily operations?

3. It’s all about the money. Is your department in total control of its contracting, billing and collections? Do its members have a thorough understanding of these processes, and if they perceive deficiencies, does the “system” either make the department whole, allow it to take on these critical tasks itself or allow it to contract to firms outside your medical school?

4. You do not get what you deserve, you get what you negotiate. Anesthesia service obligations are evolving far beyond the traditional operating room environment. The sources of remuneration for anesthesia services have expanded accordingly, but they may or may not be appropriately aligned with services currently provided. Just as with any business, the successful academic anesthesiology department will obtain adequate funding for its business plan from a variety of sources, including hospital subsidies in particular. Does your department’s leadership have sufficiently strong negotiation skills to obtain the institutional funding it needs to sustain anesthesia services in areas where traditional fee for service is either not sufficient or not available?

5. The critical importance of practice integration. Do you practice in an integrated health care delivery system sharing a mutually decided common set of goals, or does your medical school consist of balkanized clinical departments that are often at odds with each other and/or with the hospital where you practice?

6. How committed is your teaching hospital to your medical school’s education and research missions? Teaching hospitals receive enormous federal funding through the Medicare Graduate Medical Education program—an estimated $8.5 billion in 2004, for example.10 Additional educational support may flow to the teaching hospital from state and local tax revenues and from philanthropy. Is your teaching hospital a true partner in the academic enterprise, with academic support a fundamental element of its vision and mission, and with faculty members integrally involved in its operational decision-making? Or does the hospital appear to regard the medical school and its students, housestaff and faculty merely as a fortuitous source of below-market-rate labor that it can utilize in lieu of hiring adequate numbers of nurses, technicians, orderlies and other support personnel?

7. Information management is the key to our future, but you can’t manage what you can’t measure. Anesthesiologists are involved in more areas of clinical practice than ever, providing added value through services not imagined even a few years ago such as hospice palliative medicine, patient simulation education, sedation suites and hospital rapid-response teams. Expanding far beyond the traditional operating room boundaries to provide a multitude of contributions to many practice environments, we are truly the “Swiss Army knife” of our health care institutions. Accordingly our participation in the development of best practices and in the management of clinical pathways is arguably our specialty’s greatest opportunity for advances in research and clinical practice. Correct decision-making, however, is based upon the accurate acquisition and processing of data. Is information management an operational fundamental of your department, and are your department’s critical practice decisions data-driven or bias-driven? Is your department integrally involved in the development and management of clinical pathways in your institution?

Management of Financial and Intellectual Capital
Good leaders and good managers are made, not born. It is obvious that management of rats in a research laboratory is quite different than management of people in an academic anesthesiology department. No large corporation would pluck one of its employees out of the laboratory and put him/her in charge of people and projects without providing leadership and management education and without providing progressively more challenging business responsibilities through which that individual could first prove his/her fitness to lead and manage. Why should it be any different for us just because we are physicians? Rigorous career mentoring and development must be a fundamental component of every academic department of anesthesiology. In addition, external resources such as the ASA Certificate in Business Administration Program, courses from the American College of Physician Executives and advanced degrees in business, medical and hospital administration are extremely useful to physicians interested in organizational leadership and management.

The days of hiring faculty members willing to forsake their families for endless hours in the laboratory at minimal wage are long gone. Get over it. If you want to attract and retain the best and brightest physicians in academic anesthesiology, the provision of research and teaching opportunities and career mentoring will be essential but not sufficient in themselves. Just as if you were building a law, accounting or engineering firm in the 21st century that utilizes the best possible talent, competitive wages are very important in academic anesthesiology — and you are competing with anesthesiology private practice. In my state, the salary differential between academic and private practice is often between $150,000-$200,000. That is simply too large a spread to ensure that we will be able to attract the best and the brightest into academia.

What Do You Know About Your Hospital’s Ability to Provide Academic Support?
Knowledge is power, especially when it pertains to negotiation with your teaching hospital if you do not practice in a thoroughly integrated health care delivery system. If your teaching hospital is a nonprofit organization, there is a great deal of extremely useful information concerning its internal operations available to the public via its annually filed IRS Form 990, “Return of Organization Exempt From Income Tax” <www.guidestar.org>. You need to be confident that your hospital is supporting graduate medical education to the very best of its ability.

The Future of Academic Anesthesiology: An Opportunity, Not a Threat!

One can successfully deny reality, but no one can avoid the consequences of denying reality.

— Ayn Rand

What academic anesthesiology appears to be experiencing is the Darwinian process in which programs must adapt to the same changing clinical and economic practice environment routinely encountered by private practice. If a private group failed because of poor leadership or management, or because its clinical activities produced inadequate revenues due to incompetent contracting, billing and/or collections, few individuals outside that group would shed a tear. Since hospitals and ambulatory surgical centers have not yet found a way to exist without anesthesia services, the dissolution of a private anesthesia group due to a failed business plan is inevitably followed by the appearance of a new group that is financially viable. Why should academic programs somehow be immune to this reality?

Moreover, since contemporary medical practice consists of much more than the delivery of clinical services alone, shouldn’t academic programs serve as business role models, as well as clinical role models, for their trainees? In this transformational process, each academic department will either adapt itself to its disruptive environment and become a financially viable organization able to attract, develop and retain the intellectual capital needed to excel in teaching and research while providing a 21st-century practice role model for its residents and fellows — or die. We do no favors for our specialty in circumventing this evolutionary process by keeping departmental dinosaurs on life support when they persist in operating the same way they did 30 years ago.

Academic anesthesiology is a stimulating and challenging career that many of us find extremely rewarding, and it obviously is critical to the viability of our specialty. The time to focus much greater attention upon the twin engines of academic productivity — the management of financial and intellectual capital — is long overdue.

References:
1. Tremper K, Gelman S. Surviving the perfect storm: Challenges faced by our training programs. ASA Newsl. 2001; 65(2):22-24.
2. Tremper K, Barker S, Gelman S, et al. A demographic, service, and financial survey of anesthesia training programs in the United States. Anesth Analg. 2003; 96:1432-1446.
3. Tremper K, Shanks A, Sliwinski M, et al. Faculty and finances of United States anesthesiology training programs: 2002-2003. Anesth Analg. 2004; 99:1185-1192.
4. Conlay L. Points of leakage: Practice management for academic anesthesia departments, ASA 2004 Conference on Practice Management. 2004:91-97.
5. Morrison G. Mortgaging our future — The cost of medical education. N Engl J Med. 2005; 352:117-119.
6. Shapiro B. Why must the practice of anesthesiology change? It’s economics, Doctor! Anesthesiology. 1997; 86:1020-1022.
7. Lumb P. Anesthesiology: 21st century opportunities. Anesthesiol Clin N Am. 1997; 15:941-950.
8. Taylor F. Testimony of F.W. Taylor, Hearings before the Special Committee of the House of Representatives to investigate the Taylor and other systems of shop management under authority of House Resolution 90, Vol. III, 1912, pp 1377-1508.
9. Drucker P. Management’s new paradigms. Forbes. 1998; 162:152-175.
10. Bruccoleri R, Hexom B. Graduate medical education funding. American Medical Student Association 2005 <www.amsa.org/pdf/Medicare_GME.pdf>. Accessed on August 12, 2005.

David C. Mackey, M.D., is Associate Professor of Anesthesiology, University of Florida, Gainesville, Florida.