Medical and Health Services Managers

• Rapid employment growth is projected; job opportunities will be especially good in offices of health practitioners, general medical and surgical hospitals, home health care services, and outpatient care centers.
• Applicants with work experience in health care and strong business and management skills likely will have the best opportunities.
• Earnings are high, but long work hours are common.
• A master’s degree is the standard credential for most positions, although a bachelor’s degree is adequate for some entry-level positions in smaller facilities and in health information management.

Health care is a business and, like every other business, it needs good management to keep it running smoothly. Medical and health services managers, also referred to as health care executives or health care administrators, plan, direct, coordinate, and supervise the delivery of health care. Medical and health services managers include specialists and generalists. Specialists are in charge of specific clinical departments or services, while generalists manage or help manage an entire facility or system.

The structure and financing of health care are changing rapidly. Future medical and health services managers must be prepared to deal with evolving integrated health care delivery systems, technological innovations, an increasingly complex regulatory environment, restructuring of work, and an increased focus on preventive care. They will be called on to improve efficiency in health care facilities and the quality of the health care provided. Increasingly, medical and health services managers will work in organizations in which they must optimize efficiency of a variety of related services—for example, those ranging from inpatient care to outpatient followup care.

Large facilities usually have several assistant administrators to aid the top administrator and to handle daily decisions. Assistant administrators may direct activities in clinical areas such as nursing, surgery, therapy, medical records, or health information. (Managers in nonhealth areas, such as administrative services, computer and information systems, finance, and human resources, are not included in this statement. For information about them, see the statements on management occupations elsewhere in the Handbook.)

In smaller facilities, top administrators handle more of the details of daily operations. For example, many nursing home administrators manage personnel, finances, facility operations, and admissions and also have a larger role in resident care.

Clinical managers have training or experience in a specific clinical area and, accordingly, have more specific responsibilities than do generalists. For example, directors of physical therapy are experienced physical therapists, and most health information and medical record administrators have a bachelor’s degree in health information or medical record administration. Clinical 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.

Health information managers are responsible for the maintenance and security of all patient records. Recent regulations enacted by the Federal Government require that all health care providers maintain electronic patient records and that these records be secure. As a result, health information managers must keep up with current computer and software technology and with legislative requirements and developments. In addition, as patient data become more frequently used for quality management and in medical research, health information managers ensure that databases are complete, accurate, and available only to authorized personnel.

In group medical practices, managers work closely with physicians. Whereas an office manager might handle business affairs in small medical groups, leaving policy decisions to the physicians themselves, larger groups usually employ a full-time administrator to help formulate business strategies and coordinate day-to-day business.

A small group of 10 to 15 physicians might employ 1 administrator to oversee personnel matters, billing and collection, budgeting, planning, equipment outlays, and patient flow. A large practice of 40 to 50 physicians might have a chief administrator and several assistants, each responsible for different areas.

Medical and health services managers in managed care settings perform functions similar to those of their counterparts in large group practices, except that they could have larger staffs to manage. In addition, they might do more community outreach and preventive care than do managers of a group practice.

Some medical and health services managers oversee the activities of a number of facilities in health systems. Such systems might contain both inpatient and outpatient facilities and offer a wide range of patient services.

Most medical and health services managers work long hours. Facilities such as nursing care facilities and hospitals operate around the clock, and administrators and managers may be called at all hours to deal with problems. They also may travel to attend meetings or inspect satellite facilities.

Some managers work in comfortable, private offices; others share space with other managers or staff. They may spend considerable time walking, to consult with coworkers.

Medical and health services managers must be familiar with management principles and practices. A master’s degree in health services administration, long-term care administration, health sciences, public health, public administration, or business administration is the standard credential for most generalist positions in this field. However, a bachelor’s degree is adequate for some entry-level positions in smaller facilities, at the departmental level within health care organizations, and in health information management. Physicians’ offices and some other facilities may substitute on-the-job experience for formal education.

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. In 2005, 70 schools had accredited programs leading to the master’s degree in health services administration, according to the Commission on Accreditation of Healthcare Management Education.

For persons seeking to become heads of clinical departments, a degree in the appropriate field and work experience may be sufficient early in their career. However, a master’s degree in health services administration or a related field might be required to advance. For example, nursing service administrators usually are chosen from among supervisory registered nurses with administrative abilities and graduate degrees in nursing or health services administration.

Health information managers require a bachelor’s degree from an accredited program and a Registered Health Information Administrator (RHIA) certification from the American Health Information Management Association. In 2005, there were 45 accredited bachelor’s programs in health information management according to the Commission on Accreditation for Health Informatics and Information Management Education.

Some graduate programs seek students with undergraduate degrees in business or health administration; however, many graduate programs prefer students with a liberal arts or health profession background. Candidates with previous work experience in health care also may have an advantage. Competition for entry into these programs is keen, and applicants need above-average grades to gain admission. Graduate programs usually last between 2 and 3 years. They may include up to 1 year of supervised administrative experience and coursework in areas such as hospital organization and management, marketing, accounting and budgeting, human resources administration, strategic planning, law and ethics, biostatistics or epidemiology, health economics, and health information systems. Some programs allow students to specialize in one type of facility—hospitals, nursing care facilities, mental health facilities, or 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 as staff. The level of the starting position varies with the experience of the applicant and the size of the organization. Hospitals and other health facilities offer postgraduate residencies and fellowships, which usually are staff positions. Graduates from master’s degree programs also take jobs in large medical group practices, clinics, mental health facilities, nursing care corporations, and consulting firms.

Graduates with bachelor’s degrees in health administration usually begin as administrative assistants or assistant department heads in larger hospitals. They also may begin as department heads or assistant administrators in small hospitals or nursing care facilities.

All States and the District of Columbia require nursing care facility administrators to have a bachelor’s degree, pass a licensing examination, complete a State-approved training program, and pursue continuing education. Some States also require licenses for administrators in assisted living facilities. A license is not required in other areas of medical and health services management.

Medical and health services managers often are responsible for millions of dollars’ worth 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 medical and health services managers spend most of their time interacting with others.

Medical and health services managers advance by moving into more responsible and higher paying positions, such as assistant or associate administrator, department head, or CEO, or by moving to larger facilities. Some experienced managers also may become consultants or professors of health care management.

Medical and health services managers held about 248,000 jobs in 2004. About 30 percent worked in private hospitals, and another 16 percent worked in offices of physicians or in nursing care facilities. The remainder worked mostly in home health care services, Federal Government health care facilities, ambulatory facilities run by State and local governments, outpatient care centers, insurance carriers, and community care facilities for the elderly.

Employment of medical and health services managers is expected to grow faster than average for all occupations through 2014, as the health care industry continues to expand and diversify. Job opportunities will be especially good in offices of health practitioners, general medical and surgical hospitals, home health care services, and outpatient care centers. Applicants with work experience in the health care field and strong business and management skills should have the best opportunities. Competition for jobs at the highest management levels will be keen because of the high pay and prestige.

Managers in all settings will be needed to improve quality and efficiency of health care while controlling costs, as insurance companies and Medicare demand higher levels of accountability. Managers also will be needed to computerize patient records and to ensure their security as required by law. Additional demand for managers will stem from the need to recruit workers and increase employee retention, to comply with changing regulations, to implement new technology, and to help improve the health of their communities by emphasizing preventive care.

Hospitals will continue to employ the most medical and health services managers over the 2004-14 projection period. However, the number of new jobs created is expected to increase at a slower rate in hospitals than in many other industries because of the growing utilization of clinics and other outpatient care sites. Despite relatively slow employment growth, a large number of new jobs will be created because of the industry’s large size. Medical and health services managers with experience in large facilities will enjoy the best job opportunities, as hospitals become larger and more complex.

Employment will grow fastest in practitioners’ offices and in home health care agencies. Many services previously provided in hospitals will continue to shift 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. Managers with specialized experience in a particular field, such as reimbursement, should have good opportunities.

Medical and health services managers also will be employed by health care management companies that provide management services to hospitals and other organizations, as well as to specific departments such as emergency, information management systems, managed care contract negotiations, and physician recruiting.

Median annual earnings of medical and health services managers were $67,430 in May 2004. The middle 50 percent earned between $52,530 and $88,210. The lowest 10 percent earned less than $41,450, and the highest 10 percent earned more than $117,990. Median annual earnings in the industries employing the largest numbers of medical and health services managers in May 2004 were as follows:

Earnings of medical and 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, in 2004, median salaries for administrators were $72,875 in practices with 6 or fewer physicians, $95,766 in practices with 7 to 25 physicians, and $132,955 in practices with 26 or more physicians.

According to a survey by Modern Healthcare magazine, median annual compensation in 2004 for hospital administrators of selected clinical departments was $76,800 in respiratory care, $81,100 in physical therapy, $87,700 in home health care, $88,800 in laboratory services, $90,200 in long-term care, $93,500 in medical imaging/diagnostic radiology, $94,400 in rehabilitation services, $95,200 in cancer treatment facilities, $96,200 in cardiology, $102,800 in nursing services, and $113,200 in pharmacies. Salaries also varied according to size of facility and geographic region.

According to a survey by the Professional Association of Health Care Office Management, total 2004 median compensation for office managers in specialty physicians’ practices was $72,047 in gastroenterology, $66,946 in dermatology, $66,207 in cardiology, $64,543 in ophthalmology, $63,801 in obstetrics and gynecology, $62,545 in orthopedics, $58,595 in pediatrics, $52,211 in internal medicine, $50,924 in psychiatry, and $50,049 in family practice.

Medical and health services managers have training or experience in both health and management. Other occupations requiring knowledge of both fields are insurance underwriters and social and community service managers. See the Career Database for more information on these careers.

Information about undergraduate and graduate academic programs in this field is available from:

• Association of University Programs in Health Administration, 2000 North 14th St., Suite 780, Arlington, VA 22201. Internet: http://www.aupha.org/

For a list of accredited graduate programs in medical and health services administration, contact:

• Commission on Accreditation of Healthcare Management Education, 2000 North 14th St., Suite 780, Arlington, VA 22201. Internet: http://www.cahmeweb.org/

For information about career opportunities in health care management, contact:

• American College of Healthcare Executives, One N. Franklin St., Suite 1700, Chicago, IL 60606-4425. Internet: http://www.healthmanagementcareers.org/

For information about career opportunities in long-term care administration, contact:

• American College of Health Care Administrators, 300 N. Lee St., Suite 301, Alexandria, VA 22314. Internet: http://www.achca.org/

For information about career opportunities in medical group practices and ambulatory care management, contact:

• Medical Group Management Association, 104 Inverness Terrace East, Englewood, CO 80112-5306. Internet: http://www.mgma.org/

For information about medical and health care office managers, contact:

• Professional Association of Health Care Office Management, 461 East Ten Mile Rd., Pensacola, FL 32534-9712.

For information about career opportunities in health information management, contact:

• American Health Information Management Association, 233 N. Michigan Ave., Suite 2150, Chicago, IL 60601-5800. Internet: http://www.ahima.org/