How to apply business to medicine

Just after I started at Stanford’s Graduate School of Business, I wrote an article on why I’m doing an MD/MBA. I argued that business school can help clinicians develop a new perspective, acquire important skills and build bridges between doctors, policymakers, and administrators.

I heard from dozens of students, faculty, and physicians who supported the idea of an MD/MBA. However, a question repeatedly came up about as to whether my classes had any real relevance to health and medicine.

Health care is unique from a business perspective. It’s among the largest and most regulated industries in the U.S. economy, and it has extraordinarily high stakes, and, therefore, it doesn’t follow the laws of supply and demand.

So while the notion of business training was appealing, people wondered if business school was the right way for a doctor to get it. One quarter in, I remain convinced that the answer is yes. Every class I’ve taken has applications that a doctor would find useful.

Optimization and simulation modeling

OSM, a class that taught us how to model problems on Microsoft Excel, has direct relevance to health care. In fact, one of our first assignments was how to optimize the allocation of operating rooms to different surgical services. The class taught a host of analytic techniques ranging from basic optimization to decision analysis to Monte Carlo simulation.

Whether someone is a private practice doctor deciding how to allot clinic time, a hospital physician requesting resources or an academic doctor running a quality improvement project, it’s essential for physicians to understand how to model and make decisions.

Strategy and accounting

Strategy and accounting aren’t necessary for physicians at first glance, but empirical examples demonstrate their usefulness. One of our strategy cases was about workplace culture in a medical setting. Clinics that had a clear sense of direction were able to attract and retain staff, reduce costs and deliver superior outcomes.

The lesson I took away was that any physician can indirectly improve patient care by investing resources at the organizational level. Regardless of whether they are individual, hospital-based or academic, practices that have a coherent strategy and a strong financial position can better serve their patients.

Ethics, leadership labs, managerial skills, and organizational behavior

These four classes all dealt with how leaders make decisions when there isn’t a clear path forward.

Medicine aspires to achieve evidence-based decision making but we often don’t know the best approach to a problem. Medication regimens, behavioral counseling, and diagnostic testing often default to a trial and error approach.

At the same time, ethical quandaries permeate every aspect of medicine. For instance, we had a class discussion on the growing role of artificial intelligence in society, including its implications for health care.

More than anything else, business school teaches students how to navigate uncertainty. Many physicians question whether business classes are well suited to the complexities of health care. But it’s precisely because medicine is so complicated that the skills learned in business school are valuable.

An MBA isn’t required for someone to become a doctor. Even so, incorporating aspects of business training into medical curricula would serve both physicians and their patients well.

Akhilesh Pathipati is a medical student who blogs at Scope, where this article originally appeared.

Image credit: Shutterstock.com

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