Top 10 Steps for Proper Succession Planning

Posted by Continuum on Jul 10, 2018 11:43:00 AM

Contemplative male doctor_concernedRetirement may be years away, but as an independent physician, there are many succession-related issues that need your consideration—and they shouldn’t be put on the back burner.

First, who will be your replacement? Will you select a successor from the talent within your practice or medical group, or will you undergo a search for an external successor? How and when will the transition occur? Finally, what steps will be taken to provide stability for your employees, patients, and referring physicians?

To ensure a successful transition, practices should develop succession plans for all leading physicians. Follow these 10 steps to formulate a strong plan for your practice.

 

1. Develop emergency and departure-defined succession plans

There are two types of succession plans practices should prepare for leading physicians:

Emergency succession plans include all information necessary for running a practice and handling a physician’s patients, should the physician become seriously ill or pass on unexpectedly.
Departure-defined succession plans incorporate the same practice information but, are goal-oriented and focus on strategic planning with the physician’s guidance. These plans should also include milestones to monitor progress leading to the lead physician’s exit.

Both types of plans should be detailed and comprehensive to ensure continuous quality care for patients.

 

 

2. Train a successor, but allow for new and different perspectives

Whether you choose a successor from within your practice or bring on an outside physician as a junior partner, it’s important to align your goals and values. Teach your successor about your business and clearly outline his or her new roles and responsibilities, but keep in mind that your successor may have different skills and perspectives. Appreciate the new point of view, and take advantage of what he or she will bring to the table. 

 

 

3. Maintain stability for younger physicians

Younger physicians may feel threatened by an incoming physician or a change in leadership. To maintain stability, outline all upcoming changes to prepare your team for the transition. 

Also use the lead time to train younger physicians along with the successor. Training all physicians to consistently practice at the top of their licensure will help them pick up any slack when the leading physician departs.  

 

 

4. Rely on veteran physicians to offer consistency during the transition

A retiring physician’s succession plan should outline responsibilities for the practice’s veteran physicians to bridge the gap during the succession. To guarantee a seamless transition, the practice can rely on seasoned physicians for guidance, as the retiring physician gradually reduces total work hours and the replacement comes up to speed.

 

 

5. Use succession planning for proper risk management

With a detailed plan for handling practice procedures, documents, and finances, your practice minimizes the chance of legal issues and malpractice risks.1

Build a set of procedural guidelines to train new or inexperienced physicians as they learn how your practice operates. Incorporate chain of command instructions to ensure nurses and staff understand to whom they will report and where to bring any questions that arise.

 

 

6. Ensure job security for employees 

Many physicians overlook their employees when planning for succession. Yet, as managers and administrators, they are some of a practice’s most valuable assets. Your plan should stipulate how to protect your employees and staff under new leadership or following the sale of your practice.

Be transparent with your employees regarding the succession and the steps you’ve taken to safeguard their jobs. Keeping them informed helps prevent the loss of experienced staff.

 

 

7. Guarantee a seamless transition for patients

During succession, it’s crucial to be transparent both internally and externally. Patients must be apprised of the succession and assured that they will receive consistent, quality care. A letter should be sent to patients explaining the change in leadership, indicating who they should contact for follow up care, and offering methods for communicating with the practice or medical group, should they have questions or concerns. In the case of emergency succession plans, the physician should draft a template of this letter and leave blanks that can be filled in later with correct contact information.

 

 

8. Strive for continuity to maintain consistent referrals 

When changes occur in a practice, referring physicians want to know that their patients will continue to receive superb care. Training a successor far in advance helps familiarize referring physicians with the successor. This builds trust that the retiring physician has trained the successor with the knowledge and skills necessary to properly care for the referred patients.

 

 

9. Establish a chain of custody for medical records 

Since physicians have legal custody of their patients’ medical records, a succession plan should detail steps for establishing a chain of custody and legally transferring the medical records to the successor.2 Depending upon your state’s laws, your practice may also need to send notices to patients indicating their medical records will change custody.

 

 

10. Evaluate options to ensure financial security following succession

Many physicians have difficulty determining when it will be financially feasible to retire. Whether you plan to bring on a successor, have your practice buy out your partnership, or sell the practice to another physician or hospital, your succession plan must outline a strong financial plan. Work with an accountant, attorney, or a medical practice valuation expert to determine the value of your practice and steps for the future.3

 

     

Having a succession plan that takes the practice’s finances into account ensures the physician or physician’s family have the necessary financial payout to live comfortably, following the physician’s passage or full retirement.

Busy practices often consider succession planning time-consuming and burdensome, but it is crucial. Consider working with an outside partner to conduct a practice audit and build an actionable plan for a seamless transition during succession. 

For more information, please contact Devon Renzi via email at drenzi@continuumhealth.net or at (856) 782-3300 x2419. 

         1Ensure the Future of Your Practice Through Early Succession Planning

         2 Succession Planning 101 for Private Practices

         3 Succession Planning 101 for Private Practices

 

 

 

Topics: practice management, physicians

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