Is Parting Ways with Your Private Practice the Best Solution?
There’s a troubling trend in the medical field today. As young doctors emerge from medical school, more and more of them are accepting full-time employment with huge healthcare systems and hospitals, rather than venturing out into the world of private practice. Moreover, physicians who’ve managed successful private practices for years are now closing up shop and seeking future employment with hospitals as well. It’s a trend that’s been on the rise for nearly a decade.
Accenture, a global consulting firm, recently conducted a survey of 204 primary care and specialty physicians from across the United States. According to their findings, from the year 2000 to 2012, the percentage of independent physicians dropped from 57 percent to 39 percent. And throughout 2013, Accenture expects this figure to decrease even further to a record low of 36 percent.
Many students enter medical school with dreams of one day experiencing the freedom and independence that comes with operating a private practice. Captured in that ideal are hopes of treating and caring for patients on an individual basis, establishing regular office hours, and having the freedom to manage an office staff. But what these doctors soon discover is that the independence associated with running a private practice comes with its own set of challenges.
The recent increases in malpractice classic car insurance quote premiums, regulatory costs, administrative duties, and technology mandates have forced many doctors to seek out perceivably greener pastures in a more stable hospital environment. When asked why they were opting out of private practice, 87 percent of the physicians surveyed blamed increased operating costs.
However, it’s only after they’ve signed on to full-time hospital employment that these physicians discover they’ve sacrificed far more than they’ve gained. In exchange for slightly higher job stability and fixed salaries, they’ve not only forfeited the flexibility of setting their own hours, but most of them have taken pay cuts as well.
Sixty-five percent of the surveyed doctors who are joining healthcare systems said they expect to make the same amount or less than they did while working for themselves. And they can also expect to work more hours—especially now that the majority of hospitals casino online calculate a physician’s annual salary based on productivity and expertise via RVUs. (Read more about this in a previous blog post).
And while 53 percent of the doctors surveyed cited electronic medical record (EMR) requirements as another reason to desert their private practices, these same doctors were surprised to discover that their hospital employers are also subject to EMRs.
While some predict that in just a few years the number of doctors working in hospitals could be as high as 75 percent, a remnant of doctors who are committed to running a private practice remains—even in the midst of this tenuous trend. In an effort to keep their businesses operating, they’ve initiated creative strategies to lower their cost structure while bolstering their billing rates. Many are bringing specialists into the fold so exams and tests that are typically referred out to hospitals can be administered in-house, thereby increasing the billing rate per patient visit. They are also outsourcing some of their administration processes to alleviate the burden of administrative costs.
As both a doctor and a small business owner, private practice physicians are in a class by themselves. And like all successful small business owners who value their autonomy, they must develop creative strategies to adapt their practices and keep up with the ever-changing healthcare landscape. By doing so, they’re proving that private practices can not only survive, but also thrive in a changing healthcare market.