Throughout the past twenty-five years, the health-care industry has
undergone much scrutiny and change, resulting in a very different medical
landscape and one that is currently evolving. In an attempt to curb
skyrocketing health-care costs, improve access and efficiency, and reduce
medical errors, health-care reform has been a topic of every presidential
election for the past fifteen years.
Since the early 1990s, a plethora of mergers, acquisitions, and breakups
has occurred in major health-care systems throughout the United States. An
alphabet soup of new health-care organizations, management strategies, and
payment methods has been
established1.
Despite these measures, health-care costs have continued to increase from 5.2%
of the gross domestic product in 1960 to 12.4% in 1990 to 16% in
20042. Furthermore,
the United States health-care performance is ranked only thirty-seventh among
developed nations and seventy-second in the
world3.
In addition, physicians are facing increasing economic pressures. There is
a greater emphasis on patient volumes and time spent per patient, ancillary
revenue streams, and local competition. Medicare reimbursement rates for
physician services decreased by 4.4% in
20064. Meanwhile,
medical malpractice insurance rates continue to increase faster than
inflation5. The
states that enacted malpractice reforms in the 1980s have been able to control
insurance rates, while those that did not have faced malpractice
crises6.
All of these factors have led to all-time high levels of physician
dissatisfaction with the practice of medicine. Many clinicians feel powerless,
frustrated, and jaded. In 1973, less than 15% of several thousand practicing
physicians reported having any doubts that they had made the correct career
choice7. In
contrast, surveys administered within the past ten years have shown that 30%
to 40% of practicing physicians would not choose to enter the medical
profession if they were deciding on a career again, and an even higher
percentage would not encourage their children to pursue a medical
career8,9.
As a result, an increasing number of physicians are retiring early or seeking
alternative career paths, including a return to graduate school to acquire
other degrees, such as a Master of Business Administration (MBA). The purpose
of the present study was to evaluate the drivers for obtaining an MBA degree,
the utility of the MBA degree, and how obtaining it has changed the career
paths of practicing physicians.
Retrospectively, physician alumni of the Boston University Graduate School
of Management, the Harvard Business School, and the Wharton School of Business
at the University of Pennsylvania were identified by searching digital alumni
databases at each school. These databases were queried for graduates from 1980
to 2003. For the purposes of this study, we did not attempt to identify anyone
who had graduated after this date. One hundred and sixty-one physicians with
an MBA degree were identified.
A twenty-seven-question survey was distributed to these physicians though
the United States Postal Service and e-mail. After one month, surveys were
sent again by e-mail to the individuals who had not responded to the first
communication.
The survey consisted of twentyseven questions. Practice demographic and
biographic data, including information on enrollment in and completion of a
residency, specialty practiced, board certification status, practice model,
year of starting business school, and the importance of a variety of business
school courses and skill sets, were collected. Furthermore, the physicians
were asked whether their current position required them to use their business
or medical knowledge, to which they responded on a scale indicating that it
was never, rarely, sometimes, often, or always required. The physicians were
asked if they found the business degree useful to their careers, and they
indicated on a scale that it was not helpful, limited, useful, very useful, or
essential. They were asked if they would be not likely, likely, very likely,
or definitely likely to pursue an MBA degree again, if given the chance. They
were asked to allocate, by percentages, the time they spent in their career,
before and after obtaining the MBA degree, on the following activities:
patient care, teaching, basic-science research, clinical research, and
administrative responsibilities. They were asked to identify the top three
reasons for seeking an MBA degree among the following possibilities: to
enhance salary, being bored with medical practice, to learn about the business
aspects of the health-care system, to survive better in the new system, to
obtain a more interesting job, and other. Finally, the physicians were asked
to select the percentage of physicians (0%, 5%, 10%, 20%, 40%, or 60%), both
at present and in the future, who in their estimation should acquire an MBA
degree. The results were then evaluated, and statistical analysis was
performed with use of the Student t test.
Eighty-seven of the 161 surveys were received, for a response rate of 54%.
Eight surveys were discarded for being incomplete or having stray marks. The
seventy-nine respondents who had returned the remaining surveys had an average
age of 41.4 years. Sixty-six respondents (84%) completed a residency program,
while sixty (76%) were board certified. The physicians completed their MBA
degrees at an average of 8.64 years after graduating from medical school. The
distribution of these sixty-six individuals with regard to the specialty
practiced was as follows: twenty-five (38%) were internists; eleven (17%),
surgical specialists; seven (11%), emergency medicine physicians; six (9%),
pediatricians; six (9%), general surgeons; four (6%), radiologists; three
(5%), psychiatrists; two (3%), dermatologists; one (2%) was an obstetrician;
and one (2%), a family practitioner.
Business School Drivers
The top three motivations for completing an MBA degree among the physicians
included learning about the business aspects of the health-care system
(fifty-three respondents; 67%), obtaining a more interesting job (forty-one;
52%), and surviving better in the new health-care system (thirty-seven; 47%)
(Table I). Enhancing personal
finances was cited as one of the top three reasons for pursuing an MBA degree
by only twenty respondents (25%).
Allocation of Physician Labor Hours Before and After Obtaining the
MBA Degree
Prior to enrollment in business school, the respondents devoted, on the
average, 58.3% of their time to patient care, 11.8% to administrative
responsibilities, 8.5% to teaching residents and medical students, 4.57% to
performing basic-science research, and 4.23% to clinical research. After the
respondents had completed the MBA program, the allocation of time to these
activities changed significantly (Fig.
1), with an average of 31.8% of their time spent on patient care
(p < 0.001), 33.5% on administrative tasks (p < 0.001), 3.68% on
teaching residents and medical students (p < 0.001), 1.46% on performing
basicscience research (p = 0.11), and 4.55% on clinical research (p =
0.90).
Business School Skill Sets
Of the skills the respondents acquired during business school, the five
that they stated were the most pertinent to their careers were related to
evaluating systems operations and implementing improvements (thirty-nine
respondents; 49%), learning how to be a more effective leader (thirty-five;
44%), comprehending financial principles (thirty-three; 42%), working within a
team setting (twenty-seven; 34%), and negotiating effectively (twenty-five;
32%) (Table II).
Overall Utility of an MBA Degree in Career Advancement
In their profession, sixty-four physicians (81%) with an MBA degree thought
that their business degree had been essential to or very useful in the
advancement of their careers (Fig.
2). Furthermore, fifty-five physicians (70%) believed that 20% of
all current physicians should acquire an MBA degree, and fifty-two respondents
(66%) thought that 20% of all future physicians should acquire an MBA
degree.
The United States health-care system has been in a state of flux for over
two decades. As the system attempts to find solutions to providing care in a
cost-effective and efficient manner, over forty-five million individuals
remain uninsured10,
life expectancy is 77.85 years (ranking forty-eighth in the
world)11, and costs
continue to
increase12.
Furthermore, physician career satisfaction has been reported to have
declined over the same time
frame12-15.
As an industry, medicine has been impacted by the high cost of professional
liability
insurance16,
diminished
reimbursements17,
fear of
litigation18,
defensive
medicine19, and
interference in medical decision-making by managed-care
systems20,21.
High-risk specialists, such as obstetrician-gynecologists, are coping with
these stressors by minimizing or eliminating surgical volumes, changing
specialties, relocating, or ceasing to practice
entirely22. A
national physician search firm warns that more doctors in the United States
between fifty and sixty-five years old have plans to retire early, seek jobs
outside their field, or cut the number of patients they see, than ever
before23-25.
A recent survey of graduating medical students in the United States
demonstrated that a controllable life style accounted for 55% of the
variability in specialty preference from 1996 to 2002, after controlling for
income, work hours, and the years of graduate medical education
required26.
Interestingly, Schwartz et
al.27, in 1990,
reported that medical students were more inclined to select specialties that
had fewer practice work hours per week, allowed adequate time for the pursuit
of vocational activities, and seemed to have a decreased number of call
nights. These aspects seemed to be more influential than the traditional
drivers, such as remuneration, prestige, and length of training.
With all of these stressors, medicine has moved away from being a cottage
industry, in which the overall health-care system had been characterized as
antiquated, inefficient, and duplicated. During the 1970s and 1980s,
health-care costs became uncontrollable and the United States was recognized
as the number-one per capita health-care spender in the world. Indemnity
insurance allowed for the development of many inefficiencies and redundancies
in the system, as healthcare providers and systems were not held accountable
for continuously expanding costs. Today, health care is a trillion-dollar
industry that accounts for 16% of the United States gross domestic
product2.
In the 1990s, the health-care industry was a major focus of the
presidential political agenda. An initiative began to curb the escalating rate
of health-care costs by attempting to replace indemnity insurance plans with
health maintenance organizations. Since then, health maintenance organizations
have gained widespread popularity, with enrollment reaching
>25%28. New
health-care entities, such as the independent practice organization, the
physician-hospital organization, and the practice-provider organization, have
emerged as innovative attempts to control health-care economics. The federal
government in accordance with national insurance companies has implemented
diagnostic-related groups and capitation sites in order to limit medical
spending. Academic medical centers and nonprofit organizations have merged to
form large health-care systems in an attempt to reduce redundancies and
inefficient processes and to gain greater market share.
Business principles and computer technology have been central to this
revolution. These entities allow for the insightful understanding of ideas and
processes not taught in medical school and afford the potential for improved
delivery of information, more efficient transfer of information, and instant
worldwide communication. Unfortunately, few, if any, medical schools have
incorporated business classes or skill sets into their curricula. This has
left a profession of physicians without the skills that are vital in today's
environment29.
Educational institutions have attempted to fill this void through socalled
health-care, part-time, and executive MBA programs as well as on-line business
curricula that allow these busy professionals to acquire business knowledge
while maintaining demanding clinical schedules. Other institutions are
offering master's degrees in areas such as medical management and health
administration. These programs have seen enrollment skyrocket, with the
largest-growing segment of their students coming from the health-care
sector30,31.
Furthermore, medical schools are now realizing that physicians need to be
educated in the business of medicine. As a result, there are currently
forty-seven combined five-year MD-MBA programs that have been created to fill
this void. The majority of these programs have emerged in the last seven
years, which is perhaps due to the increasing demand by doctors for an MBA
degree early in their
careers32,33.
Additionally, many of these options to acquire advanced degrees are in
reaction to low physician morale that is secondary to a sense of
helplessness29,34-37.
Numerous surveys of physicians have echoed this sentiment. One survey claimed
that over 13,000 United States physicians consider administration as their
primary
specialty38.
Another survey of physicians between the ages of fifty and sixty-five years
demonstrated that approximately 38% of the respondents will close their
practice to new patients, reduce patient loads, seek nonclinical jobs in
medicine, retire, or find a nonmedical
job39.
To our knowledge, the present study is the first to attempt to characterize
the changes in physicians' career paths after acquiring an MBA degree.
Eighty-one percent of our respondents stated that their newly acquired
knowledge had a positive effect on their careers. Since the completion of
their MBA studies, these physicians allocate less than one-third of their
overall work week to the direct care of patients. Additionally, the time they
spend on administrative tasks increased by 300%. Interestingly, these
individuals did not cite the enhancement of personal finances as one of the
top three drivers for acquiring a business degree
(Table I).
A physician with an MBA degree will continue to become an increasingly
important asset in the evolving health-care system. According to the
Tampa-based Physician Executive Management Center, 27% of physicians serving
in a chief medical officer position in acute care hospitals in 1990 possessed,
or were obtaining, an advanced management degree, such as a Master of Business
Administration or a Master of Public Health or Health Administration degree.
By 2002, this proportion had increased to
44%40. According to
our respondents, approximately 20% of physicians in current practice and 20%
of those in the future should have an MBA degree. These individuals will have
the core medical knowledge to enable them to understand the medical
implications of business decisions. Furthermore, these individuals should feel
better equipped to handle the new health-care systems. A survey of medical
students enrolled in a joint MD-MBA
program41, compared
with a control group of traditional medical students, demonstrated that
dual-degree students are very conscious of the changing nature of the medical
care system and the need to transform physician roles. They were less likely
to feel negative about the changes in job opportunities for physicians or
about the regulatory or financial constraints in medicine. Also, they were
more confident in having clinical and administrative skills when they
graduated from their respective educational programs. Such knowledge should
position these individuals to become the future leaders of medicine.
There are some limitations to our study. First, our cohort of eighty-seven
respondents may not be representative of the entire population of United
States physicians with an MBA. These individuals were selected from three East
Coast business schools, and their sentiments may be different from those of
individuals in other geographic and demographic environments. Second, although
more than 70% of the respondents to this survey reported that the MBA degree
had a positive impact on their careers, we did not query about their level of
satisfaction with their careers before and after obtaining the MBA degree.
Future studies should assess the level of career satisfaction between
physicians with and those without an MBA degree. Finally, the respondents in
this study included individuals who acquired an MBA through a combined
five-year MD-MBA program as well as those who went back to school after being
in practice for a number of years. It is possible that the drivers for the
additional degree, the benefits of the MBA, and the effect on career paths may
be quite different in these two groups.
To our knowledge, this study is the first published report that attempts to
characterize the utility and effect of an MBA degree on physicians' careers.
Physicians with an MBA degree are an increasingly prevalent group in the
changing health-care system. These individuals are driven to attend graduate
school to understand the business of medicine and to find a more interesting
job. Their practice patterns change significantly after completion of the MBA,
reflecting more of an administrative role and less involvement in patient
care.