When starting a new medical school you must have the obvious: students, a curriculum and teaching faculty. An equally important aspect of a medical school, which makes it different from other university programs, is known as the "clinical practice".
Clinical practice and teaching faculty
Medical students complete much of their classroom education in the first two years of medical school. During the last two years, however, they spend it almost entirely caring for patients under the supervision of faculty and residents. Students learn by watching, practicing on each other and on models, and by providing care for real patients under physician supervision. These supervising doctors are the "clinical teaching faculty". Physicians who choose to have a career in academic medicine are indeed special because they care about helping the next generation of young doctors become the best physicians possible. Clinical teaching physicians must be completely up-to-date in their specialty because students have a deep thirst for knowledge and will continually challenge them with questions.
The practice plan
These physicians can afford to spend more time with their patients and students because they receive a portion of their salary for this teaching from the medical school. In this practice setting, supervising faculty physicians bill patients for the clinical services they provide. The revenue generated from their practice provides funding for the "practice plan". This is an extremely important element for a medical school because it manages the practice, collects revenue, and provides money for operations, including clinical practice operating expenses, salaries for nursing and other staff, and a large portion of clinical teaching faculty salaries. In addition, the dean usually takes a tax of about five percent of the total revenue to build new clinical and research programs. An additional source of revenue that flows into the practice plan is the negotiated revenue that comes from hospital partners. This revenue pays clinical faculty physicians for their time spent supervising and providing coverage of services for the hospital. The hospital bills for these services and the revenues directly fund the practice. After several years, we estimate our practice will generate approximately $50 million annually. A little more than half of that revenue will support the cost of the practice. The rest will fund salaries of the teaching faculty and the continued growth of programs.
Our consultants, PwC (PricewaterhouseCoopers), are helping us establish a viable and sustainable practice plan, one of the most important facets for our school. Our practice plan must meet legal and accounting parameters, and include appropriate objectives and incentives for managing our physicians and their practices. We plan to have our practice plan ready in 2016 so we can begin hiring physicians who will supervise our students in patient care. It's an exciting project, and I look forward to keeping you updated on our progress.
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