Maximizing Margins and Minimizing Hassles in Pediatric Practice Management

Summary of presentation from Dr. Sandy Chung from Trusted Doctors at the 2025 PMI Conference

Running a pediatric practice today brings unique challenges and opportunities, particularly as the healthcare landscape evolves. In a recent keynote talk by Dr. Sandy Chung—general pediatrician, former president of the American Academy of Pediatrics, and managing partner at Trusted Doctors—attendees were guided through actionable strategies for keeping independent practices not just viable, but thriving. Her insights covered everything from changes in healthcare business models, practical revenue strategies, negotiation tips, to leveraging technology and building high-trust organizational cultures. Here’s a synopsis of Dr. Chung’s valuable recommendations for practice leaders navigating these changing times.

**The Changing Healthcare and Business Landscape**

Dr. Chung painted a vivid picture of the rapidly shifting healthcare environment, noting a marked decline in independent practices as corporate and private equity interests have moved in. She emphasized that, though challenges abound, independent pediatric practices still persist and even prosper—if they adapt. Business acumen rooted in her own family small business background underscored the importance of entrepreneurship and customer service, traits that have become necessary as healthcare becomes more commoditized and outcomes-driven. Independent practices face increasing pressure to diversify revenue, manage costs, and maintain deep, trusting relationships with families—their key competitive advantage.

**Diversifying Revenue and Value-Based Care**

One of the most important opportunities presented in the talk was the diversification of practice revenue streams. Dr. Chung highlighted the shift to value-based care and capitation models, where practices are paid a set amount per patient, regardless of visit volume. This shift allows for innovation in care delivery, such as telehealth and emails, while simultaneously providing a buffer in times of fluctuating patient volume, like during a pandemic. She encouraged practices to look at grants as an underutilized opportunity, working with local public health organizations to secure support for community and behavioral health initiatives. Additionally, expanding offerings—lactation, nutrition, parent classes, or mental health services—can build resilience and meet emerging needs.

**Negotiation and Operational Efficiency**

Negotiating payer contracts and optimizing operational processes are critical for maximizing margins. Dr. Chung presented negotiation strategies like defining your BATNA (Best Alternative to a Negotiated Agreement), using data in discussions with insurers, and remaining silent to learn more during negotiations. Technology also plays a pivotal role—tools like AI scribes, virtual or AI-powered receptionists, texting and electronic statements, and inventory management reduce hassle and free up cash flow. She also explained the importance of capturing meaningful metrics with KPIs (Key Performance Indicators) and linking them to OKRs (Objectives and Key Results) for tangible improvement.

**Leadership, Culture, and Adaptability**

High-trust, adaptable organizational cultures are vital in times of change. Dr. Chung recommended focusing on clear, tangible recognition of individual staff contributions, promoting team autonomy and purposeful communication, investing in professional growth, and fostering vulnerability as a leadership strength. Leaders must balance innovation with sensitivity to staff personalities, employing intentional change management strategies. She also encouraged staying informed about evolving laws, embracing digital engagement with families, and understanding the generational differences in communication and expectations—from Gen Alpha to parents looking for new pediatricians.

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**5 Practical Takeaways for Pediatric Practice Leaders:**

1. **Diversify Revenue Streams:**  
   Explore value-based care agreements, partial capitation contracts, and grant-funding partnerships. Expand your practice’s offerings beyond standard medical care to include mental health, nutrition, lactation, and parent education services.

2. **Leverage Data and OKRs:**  
   Regularly review financial and operational KPIs. Link them to specific, measurable OKRs to drive strategic improvements in areas like revenue, efficiency, and patient outcomes.

3. **Innovate with Technology:**  
   Adopt AI scribes or virtual receptionists, implement electronic payment systems, and use inventory management tools to reduce costs and free up staff for higher-value work.

4. **Master Negotiation:**  
   Prepare for payer or vendor negotiations by clearly defining your BATNA, using compelling data, and practicing effective communication strategies, including knowing when to use silence.

5. **Build a High-Trust, Adaptable Team:**  
   Recognize and reward contributions in personal, tangible, and unexpected ways. Engage teams in goal-setting, provide opportunities for skill development, and lead with transparency and empathy, especially in times of change.

By integrating these lessons, pediatric practice leaders can maximize margins, minimize administrative burdens, and sustain their mission of delivering high-quality, relationship-driven care.