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Nature of the Work
* Earnings of health services managers are high, but long weekly work hours are common.
* Most are employed by hospitals, but the fastest employment growth will be in home health care agencies, long-term care facilities, and practitioners' offices and clinics.
Health care is a business, albeit a special one. Like every other business, it needs good management to keep it running smoothly, especially during times of change. The term "health services manager" encompasses individuals in many different positions who plan, organize, coordinate, and supervise the delivery of health care. Health services managers include both generalistsadministrators who manage or help to manage an entire facility or systemand health specialistsmanagers in charge of specific clinical departments or services found only in the health industry.
The structure and financing of health care is changing rapidly. Future health services managers must be prepared to deal with evolving integrated health care delivery systems, restructuring of work, technological innovations, and an increased focus on preventive care. They will be called upon to improve efficiency in all health care facilities, while continually improving quality of the health care provided. Increasingly, health services managers work in organizations in which they must optimize efficiency of a variety of interrelated services, ranging from inpatient care to outpatient follow-up care, for example.
The top administrator or chief executive officer (CEO) and the assistant administrators without specific titles are health care generalists, who set the overall direction of the organization. They concentrate on such areas as community outreach, planning, marketing, human resources, finance, and complying with government regulations. Their range of knowledge is broad, including developments in the clinical departments as well as in the business arena. They often speak before civic groups, promote public participation in health programs, and coordinate the activities of the organization with those of government or community agencies. CEO's make long-term institutional plans by assessing the need for services, personnel, facilities, and equipment and recommending changes such as opening a home health service. CEO's need leadership ability, as well as technical skills, to provide quality health care while satisfying demand for financial viability, cost containment, and public and professional accountability.
Larger facilities typically have several assistant administrators to aid the top administrator and to handle day-to-day decisions. They may direct activities in clinical areas such as nursing, surgery, therapy, food service, and medical records; or the activities in nonhealth areas such as finance, housekeeping, human resources, and information management. (Because the nonhealth departments are not directly related to health care, these managers are not included in this statement. For information about them, see the statements on managerial occupations elsewhere in the Handbook). In smaller facilities, top administrators may handle more of the details of day-to-day operations. For example, many nursing home administrators directly manage personnel, finance, operations, admissions, and have a larger role in resident care.
Clinical managers have more narrowly defined responsibilities than generalists, and have training and/or experience in a specific clinical area. For example, directors of physical therapy are experienced physical therapists, and most health information administrators have a bachelor's degree in health information administration. These managers establish and implement policies, objectives, and procedures for their departments; evaluate personnel and work; develop reports and budgets; and coordinate activities with other managers.
In group practices, managers work closely with the physician owners. While an office manager may handle business affairs in small medical groups, leaving policy decisions to the physicians themselves, larger groups generally employ a full-time administrator to advise on business strategies and coordinate day-to-day business.
A small group of 10 or 15 physicians might employ a single administrator to oversee personnel matters, billing and collection, budgeting, planning, equipment outlays, and patient flow. A large practice of 40 or 50 physicians may have a chief administrator and several assistants, each responsible for different areas.
Health services managers in health maintenance organizations (HMO's) and other managed care settings perform functions similar to those in large group practices, except their staffs may be larger. Also, they may do more work in the areas of community outreach and preventive care than managers of a group practice. The size of the administrative staff in HMO's varies according to the size and type of HMO.
Some health services managers oversee the activities of a number of facilities in multifacility health organizations.
Health services managers held about 329,000 jobs in 1996. Over one-half of all jobs were in hospitals. About 1 in 4 were in nursing and personal care facilities or offices and clinics of physicians. The remainder worked in home health agencies, medical and dental laboratories, offices of dentists and other practitioners, and other health and allied services.
Health services managers must be familiar with management principles and practices. Some learn from work experience. However, formal education is usually necessary for advancement. Most CEO positions require a graduate degree in health services administration, nursing administration, public health, or business administration. For some generalist positions, employers seek applicants with clinical experience (as nurses or therapists, for example) as well as academic preparation in business or health services administration.
Bachelor's, master's, and doctoral degree programs in health administration are offered by colleges, universities, and schools of public health, medicine, allied health, public administration, and business administration. There are also some certificate or diploma programs, generally lasting less than 1 year, in health services administration and in medical office management. A master's degreein health services administration, long term care administration, health sciences, public health, public administration, or business administrationis the standard credential for most generalist positions in this field. However, a bachelor's degree is adequate for some entry-level positions in smaller operations. A bachelor's degree is required to work in some settings, such as nursing homes, and for entry level positions at the departmental level within health care organizations. Physicians' offices and some other facilities may substitute on-the-job experience for formal education. For clinical department heads, a degree in the appropriate field and work experience may be sufficient, but a master's degree in health services administration usually is required to advance.
In 1997, 67 schools had accredited programs leading to the master's degree in health services administration, according to the Accrediting Commission on Education for Health Services Administration.
Some graduate programs seek students with undergraduate degrees in business or health administration; however, many programs prefer students with a liberal arts or health professions background. Competition for entry to these programs is keen, and applicants need above-average grades to gain admission. The programs generally last between 2 and 3 years. They may include up to 1 year of supervised administrative experience, and course work in areas such as hospital organization and management, marketing, accounting and budgeting, human resources administration, strategic planning, health economics, and health information systems. Some programs allow students to specialize in one type of facilityhospitals; nursing homes; mental health facilities; HMO's; or outpatient care facilities, including medical groups. Other programs encourage a generalist approach to health administration education.
New graduates with master's degrees in health services administration may start as department managers or in staff positions. The level of the starting position varies with the experience of the applicant and size of the organization. Postgraduate residencies and fellowships are offered by hospitals and other health facilities; these are usually staff positions. Graduates from master's degree programs also take jobs in HMO's, large group medical practices, clinics, mental health facilities, and multifacility nursing home corporations.
Graduates with bachelor's degrees in health administration usually begin as administrative assistants or assistant department heads in larger hospitals, or as department heads or assistant administrators in small hospitals or nursing homes.
A Ph.D. degree may be required to teach, consult, or do research. Nursing service administrators are usually chosen from among supervisory registered nurses with administrative abilities and a graduate degree in nursing or health services administration.
Most States and the District of Columbia require nursing home administrators to have a bachelor's degree, pass a licensing examination, complete a State-approved training program, and pursue continuing education. A license is not required in other areas of health services management.
Health services managers are often responsible for millions of dollars of facilities and equipment and hundreds of employees. To make effective decisions, they need to be open to different opinions and good at analyzing contradictory information. They must understand finance and information systems, and be able to interpret data. Motivating others to implement their decisions requires strong leadership abilities. Tact, diplomacy, flexibility, and communication skills are essential because health services managers spend much of their time interacting with others.
Health services managers advance by moving into more responsible and higher paying positions, such as assistant or associate administrator, or by moving to larger facilities.
Employment of health services managers is expected to grow faster than the average for all occupations through the year 2006 as health services continue to expand and diversify. Opportunities for health services managers should be closely related to growth in the industry in which they are employed. Opportunities will be good in home health care, long-term care and nontraditional health organizations such as managed care operations, particularly for health services managers with work experience in the health care field and strong business and management skills.
Hospitals will continue to employ the most managers, although the number of jobs will grow slowly compared to other areas. As hospitals continue to consolidate, centralize, and diversify functions, competition will increase at all job levels.
Employment will grow the fastest in home health agencies, offices of physicians and other health practitioners, and nursing and personal care facilities due to an increased number of elderly individuals who will need care. In addition, many services previously provided in hospitals will be shifted to these sectors, especially as medical technologies improve. Demand in medical group practice management will grow as medical group practices become larger and more complex. Health services managers will need to deal with the pressures of cost containment and financial accountability, as well as the increased focus on preventive and primary care. They will have more responsibility for improving the health of populations and communities.
Health services managers will also be employed by health care management companies who provide management services to hospitals and other organizations, as well as specific departments such as emergency, information management systems, managed care contract negotiations, and physician recruiting.
Earnings of health services managers vary by type and size of the facility, as well as by level of responsibility. For example, the Medical Group Management Association reported that the median salary for administrators in small group practiceswith fewer than 7 physicianswas about $56,000 in 1996; for those in larger group practiceswith more than 7 physicians$77,000.
According to a 1997 survey by Modern Healthcare magazine, half of all hospital CEO's earned total compensation of $190,500 or more. Salaries varied according to size of facility and geographic region. Clinical department heads' salaries varied also. Median total compensation in 1997 for heads of the following clinical departments were: Respiratory therapy, $54,500; home health care, $62,000; clinical laboratory, $63,700; radiology, $64,000; physical therapy, $64,900; ambulatory/outpatient services, $68,500, rehabilitation services, $70,400; and nursing services, $97,000.
According to the Buck Survey conducted by the American Health Care Association in 1996, nursing home administrators had median annual compensation of about $49,500. The middle 50 percent earned between $42,100 and $57,300. Assistant administrators earned about $32,000, with the middle 50 percent earning between $26,200 and $40,000.
Executives often receive bonuses based on performance outcomes such as cost-containment, quality assurance, and patient satisfaction.
Health services managers have training or experience in both health and management. Other occupations requiring knowledge of both fields are public health directors, social welfare administrators, directors of voluntary health agencies and health professional associations, and underwriters in health insurance companies.
General information about health administration is available from:
American College of Healthcare Executives, One North Franklin St., Suite 1700, Chicago, IL 60606. Homepage: http://www.ache.org
Information about undergraduate and graduate academic programs in this field is available from:
Association of University Programs in Health Administration, 1911 North Fort Myer Dr., Suite 503, Arlington, VA 22209. Homepage: http://www.aupha.org
For a list of accredited graduate programs in health services administration, contact:
Accrediting Commission on Education for Health Services Administration, 1911 North Fort Myer Dr., Suite 503, Arlington, VA 22209.
For information about career opportunities in long term care administration, contact:
American College of Health Care Administrators, 325 S. Patrick St., Alexandria, VA 22314.
For information about career opportunities in medical group practices and ambulatory care management, contact:
Medical Group Management Association, 104 Inverness Terrace East, Englewood, CO 80112.
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