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Debra Phairas of Practice & Liability Consultants: “Learn Financial benchmarking”

I educate my physician clients that the first rule of being in business is to stay in business. Therefore, they have to be profitable to stay in business. Even though it is medicine, it is still running a small business and they must learn financial, operations, human resources and marketing principles. For example, learning the […]

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I educate my physician clients that the first rule of being in business is to stay in business. Therefore, they have to be profitable to stay in business. Even though it is medicine, it is still running a small business and they must learn financial, operations, human resources and marketing principles. For example, learning the four accounts receivable ratios is simple math and I joke that if you put a dollar sign in front of math, physicians freak out. I say, you did much harder math to get into medical school so just take on the dollar signs and calculate the math.


As a part of our interview series with prominent medical professionals called “5 Things You Need To Know To Create a Highly Successful Private Practice” I had the pleasure of interviewing Debra Phairas.

Debra Phairas is President of Practice & Liability Consultants, LLC a nationally recognized firm specializing in practice management and malpractice prevention. Her consulting experience includes over 2,000 practices of all sizes and specialties. She has presented seminars and lectures nationwide for state and local medical/dental associations, management organizations and specialty societies.


Thank you so much for joining us in this interview series! Before we dive in, our readers would love to “get to know you” a bit better. Can you tell us a bit about your ‘backstory’ and how you ended up where you are?

I established my physician practice management consulting business in 1985. I have served over 2,000 practices of all sizes and medical specialties. I started in pre-med in undergraduate but decided not to pursue this avenue but was still interested in the healthcare field. I found my niche in consulting on the business side and I love to present educational seminars and webinars for physicians and office staff.

I’m a huge fan of mentorship throughout one’s career. None of us are able to achieve success without some help along the way. Who has been your biggest mentor? What was the most valuable lesson you learned from them?

Leif Beck was the head of The Health Care Group and published a newsletter about physician practice management. I decided to publish one on risk management and he subscribed to it! We spoke often and he was so wise and encouraging.

What made you want to start your own practice? Can you tell us the story of how you started it?

I was working at a physician malpractice insurance company here in California. My former business partner and I developed the malpractice industry’s first physician office risk management audit. We performed this audit for large group insured. Since both of us had practice management as well as the risk management, we gave them both business and risk recommendations and the groups kept saying they got both sides. After the 5th group complimented us on giving them good recommendations that improved the business side as well as reducing risk, we were driving home from Fresno and said, maybe there is a business here. So, we did it! We chose the name Practice & Liability Consultants.

Can you share the most interesting story that happened to you since you began your career?

The most interesting project was spending two three-week stints in Alaska for the malpractice insurance company there. The first was in March and the second time in May. We flew all over the state with a general surgeon who had his own plane. We landed on a dirt road in Palmer Alaska as well as flew to Nome over miles of snow-covered mountains. I thought if we crashed, they wouldn’t find us until the snow melted! This was around 1989 and before cell phones. In Nome, the smartest woman on each of the Aleutian Island was brought into the hospital for essentially a 12 week “ nurse practitioner” training, then sent back to the island with a medication kit. Each day, a physician would communicate via short wave radio about someone’s condition and they would decide how to treat. These women were amazing and the doctors said they knew the patients so well they became excellent diagnosticians. Now, of course it would be zoom telehealth.

Because it is a “helping profession”, some healthcare providers struggle with the idea of “monetization.” How do you address the business aspect of running a medical practice? Can you share a story or example?

I educate my physician clients that the first rule of being in business is to stay in business. Therefore, they have to be profitable to stay in business. Even though it is medicine, it is still running a small business and they must learn financial, operations, human resources and marketing principles. For example, learning the four accounts receivable ratios is simple math and I joke that if you put a dollar sign in front of math, physicians freak out. I say, you did much harder math to get into medical school so just take on the dollar signs and calculate the math.

Managing being a provider and a business owner is a constant balancing act. How do you manage both roles? I am a consultant, not a provider but I stress that you must take care of yourself so that you can take care of your staff and patients. Healthy habits including exercise and good eating habits along with sleep will make you more effective to balance all you need to do. Hire an excellent practice manager to take the business load off of you.

From completing your degree to opening a practice and becoming a business owner, your path was most likely challenging. Can you share a story about one of your greatest struggles? Can you share what you did to overcome it? I am not a medical provider but starting my own consulting business took so much time and effort. I am glad I was young when I started because I had so much energy. My greatest struggle was splitting with my former business partner. I realized I was bringing in 90% of the revenue but having to split net income 50/50. I bought her out and that was the best decision. I used my personal experience to advise physicians that rarely do two people work the same amount. Productivity formulas for income distribution make the most sense to reward those who work harder.

Ok, thank you. Here is the main question of our interview. What are the 5 things you need to know to create a thriving practice, and why? (Please share a story or example for each.)

  1. Learn Financial benchmarking
  2. Praise in Public, Reprimand in Private for staff
  3. Learn Lean Six Sigma for operations improvements.
  4. Understand that all businesses have to market their services including physicians.
  5. Your customers are your patients, referring physicians, hospitals and insurance companies. Be the role model for superlative customer service.

As a business owner you spend most of your time working IN your practice, seeing patients. When and how do you shift to working ON your practice? (Marketing, upgrading systems, growing your practice, etc.) How much time do you spend on the business elements? Take continuing education courses on the business side of the practice.

I understand that the healthcare industry has unique stresses and hazards that other industries don’t have. What specific practices would you recommend to other healthcare leaders to improve their physical or mental wellness? Can you share a story or example? Pilates, walking, biking, golfing, dancing and wine tasting I highly recommend. Cooking and entertaining with friends and family is so important.

Can you please give us your favorite “Life Lesson Quote”? Can you share a story about how that was relevant in your own life?

Change is the Law of Life, those who look only to past or present are certain to miss the future. JFK

How can our readers further follow your work online?

www.practiceconsultants.net www.medicalpracticesusa.com and www.facebook.com/practiceconsultants

Thank you for these great insights! We wish you continued success and good health!

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