American Association for Physician Leadership


Why Business Training for Physicians Can Improve Patient Care

Kaci Durbin, MD, MBA, FACOG

November 30, 2018


Learn details on why management training for physicians (MBA) can make medicine stronger and patient care better.

Many health care leaders say management courses aren’t merely nice to have — they’re essential for the modern practice of medicine.

Business curriculum as a part of medical training has become popular for medical students and physicians over the last decade. The number of MD-MBA, dual-degree programs increased by 25 percent from 2011 to 2012 alone,1 yet only about half of universities offer leadership or management training for medical students or residents. Of those that do, these courses are typically elective.2

Many physicians and health care leaders say these courses aren’t merely nice to have — they’re essential for the modern practice of medicine. Christopher Myers, PhD, a faculty member at the John Hopkins Carey Business School and School of Medicine, is one such leader. Myers’ research has focused on learning and leadership in the field of medicine. In addition to his numerous published works about business training for health care professionals, Myers teaches business executive courses for physicians.

Medical and management training don’t need to be mutually exclusive. Physicians can better help the patient while at the same time be cognizant of cost and efficiency issues.

“This core training around management skills and leadership skills would benefit everyone,” Myers says, “whether they’re planning on going into an administrative role or not. Everyone who’s a physician is leading in some capacity.”

Not all physicians need an MBA. However, many health care leaders say courses in managing others, leading teams and communicating effectively should become part of the required medical student and resident curriculum. Although some physicians pursue this type of training later in their careers, optimally, many say it should be done earlier.

Maria Chandler, MD, MBA, a physician who is president of the California-based Association of MD/MBA Programs, has seen firsthand the benefits of business training during medical school. Chandler not only started the MD-MBA dual-degree program at the University of California at Irvine, but also founded the association she heads. She says business training should begin early for medical students. “I would start right in year one of medical school,” she says. “It’s perfect timing. They see all of their training differently when they’ve got their business training alongside [their medical training].”

The reasons aren’t only financial- or career-oriented. While it has been well-documented that physicians with business training, such as those who have MBA degrees, typically run more successful practices, are more likely to serve in leadership positions and make more money, many health care professionals say these are not the most important reasons to make management training standard. There’s some evidence doing so can help patients, by decreasing medical errors, increasing health care efficiency, and promoting health care innovation.

Medical Errors

As many as 400,000 deaths occur in the United States each year after medical errors, and the latest research shows that most of these errors can be traced to poor communication and inadequate teamwork behaviors.3,4 “The things that are harming patients these days are often linked back to issues of management, of communication and of leadership more often than they are linked back to incorrect clinical care,” Myers says. “Tell me what is medically wrong with amputating the wrong leg? It’s not a clinical problem at all. It’s completely a management problem.”

RELATED: Medical School Students Getting the Business

Physicians receive extensive training in medical knowledge and technical skills, but they rarely are taught to communicate effectively or lead a team. The Accreditation Counsel for Graduate Medical Education , the organization that sets the standards for and accredits all U.S. residency and fellowship programs, lists “interpersonal skills” as one of the core competencies of resident education, yet Myers says many residents he has encountered “could not point to a tangible instance when they’re getting trained on that.”

Courses in management, leadership, effective communication and organizational culture have been proved in other areas to improve team performance and reduce errors. A recent review from Rice University revealed that health care team training can reduce medical errors by 18 percent.5 Courses have been developed for health care workers, such as Team STEPPS (a patient safety initiative from the Agency for Healthcare Research and Quality) and the Care Innovation and Transformation program (a similar program from the American Organization of Nurse Executives), which are aimed at improving communication and teamwork skills.6,7

However, many of these courses are taught in an afternoon, and some health care leaders call them a poor substitute for a full management or interpersonal communication course.8 Health care leadership training is the most effective when it takes place over time.8

Health Care Efficiency

Business training and medical training are very different, Chandler says. “Business school is based on efficiency … because you have to have an efficient business to stay afloat,” she says, while medical training teaches saving the patient at all costs.


The American Association for Physician Leadership has partnered with five universities that recognize association courses as prerequisites for physicians seeking advanced degrees with a focus in health care leadership.

University of Massachusetts at Amherst: MBA with focus in Medical Management.

Carnegie Mellon University: Master of Medical Management.

University of Southern California: Master of Medical Management.

Thomas Jefferson University: Master of Sciences in Healthcare Quality and Safety Management, and Master of Science in Population Health.

Arizona State University: Master of Science in the Science of Healthcare Delivery, and Master of Advanced Study in Health Informatics.

These programs are designed to offer flexibility in scheduling, with live and/or online offerings, and tuition savings for members. Click here for details.

They are two mindsets, but they don’t need to be mutually exclusive. Physicians with business training see both sides and can help the patient while at the same time being cognizant of cost and efficiency issues.

Chandler gives the example of a medical student and MBA candidate working at her facility. During the student’s radiology rotation, he noticed an inefficiency in the department’s routing and transfer of patients. After implementing his suggestions, the department successfully doubled the number of patients seen without increasing costs. “No other medical student is going to be thinking like that,” she says. “They are going to be standing there, glad that they have a few minutes to study for their test tomorrow.” Business training “changes their whole perspective going through.”

Health care expenditure is forecasted to reach 20 percent of the U.S. gross domestic product by 2024.8 Approximately one-third of this spending, perhaps as much as $1 trillion, is considered waste — inefficient and unnecessary care.9,10 Having physicians well-versed in management is better for hospitals.5,11 There’s data showing the presence of a physician CEO is associated with higher-quality care, including better structure, process and outcomes.11

New Medical Treatments

Physicians with a business background often have an entrepreneurial side and can bring new ideas to market. Chandler says physician entrepreneurs are vital to the advancement of medicine. Physicians often have great ideas for new devices or treatments, but often do not understand how to make their idea a reality, while business-trained individuals might understand how to find startup money and market a product, but often do not understand the science behind the product. A physician with a business background; however, can do both successfully.

“That’s how we’re going to cure diseases. These [physician entrepreneurs] know how to start their own company and get it out there,” Chandler says.

RELATED: What Attributes Do Organizations Seek in Future Physician Leaders?

The Society of Physician Entrepreneurs was founded in 2011 by three physicians in response to this need. This national organization, based in South Norwalk, Connecticut, aims to support and assist physicians in commercializing their ideas or inventions.12

Physicians increasingly recognize the need for business courses during medical training. Following demand, the number of MD-MBA programs has grown from six to 65 in the last 20 years.13 In addition, some attending physicians are going back for additional education after residency. “My hope is that all these rising MD-MBAs are going to filter up into leadership positions,” Chandler says, “and say, ‘We are changing this. We are going to be the changemakers.’ ”

Kaci Durbin, MD, MBA, FACOG, is an obstetrician-gynecologist and director of OB-GYN hospitalists at St. Anthony’s Medical Center in St. Louis, Missouri, as well as a freelance writer.


Goyal R, Aung KK, Oh B, Hwang TJ, Besancon E, Jain SH. AM last page. Survey of MD/MBA programs: opportunities for physician management education. Acad Med. 2015 Jan; 90(1):121.

Neeley SM, Clyne B, Resnick-Ault D. The state of leadership education in US medical schools: results of a national survey. Med Educ Online. 2017;22(1):1301697..James JT. A new, evidence-based estimate of patient harms associated with hospital care. J Patient Saf. 2013 Sep;9(3):122-8.

Dingley C, Daugherty K, Derieg MK, Persing R. Improving Patient Safety Through Provider Communication Strategy Enhancements. In: Henriksen K, Battles JB, Keyes MA, Grady ML, editors. Advances in Patient Safety: New Directions and Alternative Approaches (Vol. 3: Performance and Tools). Rockville (MD): Agency for Health care Research and Quality (US); 2008 Aug.

Salas E, Zajac S, Marlow SL. Transforming health care one team at a time: 10 observations and the trail ahead. Group and Organization Management. 2018.

Team STEPPS. Agency for Healthcare Research and Quality website. . Accessed Sept. 19, 2018.

Care Innovation and Transformation. American Organization of Nurse Executives website. . Accessed Sept. 19, 2018.

Sonnino RE. Health care leadership development and training: progress and pitfalls. Journal of Healthcare Leadership. 2016;8:19-29. doi:10.2147/JHL.S68068.

Poisal JA, Wolfe CJ, Lizonitz JM, et al. National health expenditure projections, 2014-24: spending growth faster than recent trends. Health Affairs. 2015;34(8):1407-1417.

Berwick DM, Hackbarth AD. Eliminating waste in US health care. JAMA. 2012;307(13):1513-1516.

Tran LD, Zimmerman FJ, Fielding JE. Public health and the economy could be served by reallocating medical expenditures to social programs. SSM - Population Health. 2017;3:185-191.

Goodall AH. Physician leaders and hospital performance: is there an association? Soc Sci Med. 2011 Aug;73(4):535-539.

Society of Physician Entrepreneurs website. . Accessed Oct. 12, 2018.

Goyal R, Aung KK, Oh B, Hwang TJ, Besancon E, Jain SH. AM last page. Survey of MD/MBA programs: opportunities for physician management education. Acad Med. 2015 Jan;90(1):121.

Kaci Durbin, MD, MBA, FACOG

Kaci Durbin, MD, MBA, FACOG, is an obstetrician-gynecologist and director of OB-GYN hospitalists at St. Anthony’s Medical Center in St. Louis, Missouri, as well as a freelance writer.

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