Building a Strategic Plaform for Referral Development

While there's no one way to build a referral development effort, some core best practices and models have proven results. Here's a look at the top seven steps for building a successful physician relations strategy. We'll start off with a discussion of the first three steps:

1. Planning to Achieve Goals
2. Structure, Model and Approach
3. ROI
4. Messages
5. Right Staff in the Right Roles with the Right Pay
6. Training
7. Market Intelligence

Planning

This step includes two phases, both critical to your referral development effort: 

1. Establish a physician specific business plan. Unlike the traditional service-line plans, this identifies the physicians, their practice volumes and potential to support your service lines and creates a trended baseline of their current activity with a projection of desired growth, maintenance or leakage management. 

Business planning also encompasses a review of your competition (which may include some of your targeted physicians) and an internal service-line readiness assessment (where do you have capacity and access…) Business planning also helps you to align the function's objectives with overall organizational goals and identify how the function will receive credit for their referral development work.

2. Create a sales plan. The road map for each physician relations representative focuses on targeted physicians, desired goals and the activities that ensure they deliver outcomes. Sales plans are usually a tactical model that codes their physicians in terms of referral volume/service-line contribution levels, frequency of visits and other modalities of contact to ensure ongoing communication and interaction. Revisit and update these plans quarterly.

Structure, Model and Approach

It's important to align the physician relations strategy and staff within the appropriate leadership team member's reporting relationship. Beyond the actual reporting area, it is most important to report to a leadership team member who can serve as the champion of the program internally, advocating for budget, resources and integration of the function into key service-line initiatives.

Many of the programs report to Business Development or Marketing. However, some report to Physician Services, the CEO or COO, depending upon the size of the community and hospital. 

Beyond the leadership reporting structure, the function will most likely require a hands- on, day-to-day manager of referral development—the person who recruits, trains and manages the staff. The optimum person in this role is someone with sales experience or the ability to learn sales as a part of their current function within the hospital.

Your business plan identifies the total pool of physicians (primary care, internal medicine and specialists) that will be a part of this strategy. Then, you can calculate how many staff members you'll need to have adequate coverage. 

This is a math game. How many hours will the staff member be able to be in the field direct selling, 24 or 32? What's their drive time? If you're in Nebraska or in Chicago traffic, that may affect territory/time management and how many appointments they can facilitate per day.

There aren't magic numbers here. But with the right calculations, each salesperson should be able to focus on about 350 physicians per year.

The right approach is determining two elements: bringing your brand to life for your staff and physicians, and creating marketing materials and strategic initiatives focused on the physician as customer. This requires Leadership to identify a style and approach that reflects the organization's culture and make sure it's embodied within the referral development team.

ROI – Return on Investment

It's important to establish the return on investment for your referral development efforts – and make sure that all of leadership is in agreement with the formula. Steps to determine ROI:

1. Review your strategy, goals and physician business plan
2. Identify outcomes that you feel the referral development staff are able to impact through direct sales.
3. Work with Leadership to determine data elements that will be tracked and reported specific to referring and admitting physician, service line and procedures. Cross reference data with referral development staff's assigned physician pool, tactical activities in relationship management and forecasted outcomes in terms of activities and referral volume changes.
4. Clearly define growth, retention and leakage management targets.
5. Establish tracking and reporting systems (marriage of hospital/clinic and procedure data with sales activity/customer relationship management (CRM) system data.

Map Your Plan and Revisit It Often

For some organizations, a formal business case, plan and model are required for initiation of a new strategy. For others, they build infrastructure and place people in positions, working out the strategic details as it evolves. Regardless of the organizational approach, take the time to either map out or revisit your plan, approach and ROI in order to stay in tune with your overall organizational goals and the physician strategy alignment and ensure you're prepared to deliver on the promise.

The Corporate Health Group team can help you create the most effective plan for the unique needs of your organization. For a free one-hour consultation, sign up today!

Get an in-depth look at how to create your own physician relations program. Order the CHG-authored book, Physician Relations Today: A Model for Growth.
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