Creating Opportunities - Advice for Physicians
The location of a new practice is more than simply the choice between urban or rural, more than just the difference between living in the mountains or on the coast. When considering location, distinguish between those aspects that are merely appealing to you and those that are absolutely essential. Do you need a good school system for the kids? How important is climate? Do traffic and commuting times make you crazy? Will your spouse have good career opportunities in the area you're considering? Does the area have the cultural amenities, outdoor recreational opportunities, shopping, or fine dining options you're seeking? Does the area have a multicultural community and or religious community that meets your families needs?
A helpful resource for choosing a location is the Places Rated Almanac. It includes a quiz that helps you identify what factors are most important to you in a place to live, and it ranks metropolitan areas in the United States according to a number of factors, including transportation, education, health care, climate, and economic growth and others. Sperling's Best Places is another useful guide and has a Web site that gives school statistics, crime rates, and data on climate and cost of living.
Academic verses Private practice
Academic or private practice—this is a key first choice, and one you may have already made. If you think you are open to either, make sure you have an accurate concept of what each entails. You might think you have a good idea about the academic side because of your years in training. But academic institutions vary a great deal, and there are variations even within a single institution. Most schools offer either a clinical track or a tenure track, which have different criteria for promotion and different requirements for teaching, research, publication, and clinical care. When considering an academic position, investigate the options available and find out whether it's possibile to change from one track to the other in later years. A good resource to find out about academic salaries is the annual Report on Medical School Faculty Salaries, published by the Association of American Medical Colleges (visit www.aamc.org and click on "Publications"). Balancing the demands of clinical, research, or teaching responsibilities is one of the challenges of academic practice.
Private practice with Academic Affiliation
Many physicians decide to join a private practice but continue to maintain an academic affiliation. The level and involvement varies greatly with each group, with many offering opportunities for training medical students or residents, and diverse opportunities for clinical research.
Types of private practice settings
Most physicians begin their professional career by joining a group practice, etiher in a single specialty group or a multispecialty group. You should be familiar with the different legal structures of medical practices and understand the advantages and limitations of each. Here are three of the more common structures:
- Professional corporation. The physicians are shareholders and elect or appoint a board of directors among themselves. The corporate structure generally protects the physicians' personal assets from creditors of the corporation.
- Partnership. Two or more physicians are co-owners of the practice. Each partner carries liability for the actions of other partners. The physicians share expenses and divide income under a pre-determined formula.
- Limited liability Company (LLC). This structure combines characteristics of a corporation and a partnership.
Group practice settings
Groups can provide collaborative environments for newly graduated residents and fellows, since they offer more experienced physicians in a variety of disciplines. Large groups also have the means to employ professional staff with the expertise and training to handle management tasks, which in a smaller group, fall to the physicians.
Of course, you give up a certain amount of independence when you join a group. But remember also that group practices can often afford equipment and provide ancillary services that a solo practitioner can not. Many of those additional services are billable and income generators. Larger groups also have more clout when negotiating with insurance companies for reimbursement rates.
In selecting a group that matches what you want in a practice, consider how these factors compare with your goals and desired practice style:
- Group size and diversity (physician age, gender, subspecialties if any)
- Group philosophy (toward finances, lifestyle, patient care)
- Strategies for economic stability and growth
- Perspectives on managed care, Medicare, Medicaid
- Patient mix
- Practice management (computerization, billing methods, appointment scheduling, staff efficiency)
When joining a group, you will typically be offered an employment contract with a guaranteed salary for the first one or two years, which serves as a trial period for both you and the group. The road to partnership, ownership, or continued employment after that period should be clear in the contract. Sometimes, there is a buy-in requirement to become a full owner.
Physician employment by hospitals is once again becoming a very popular strategy for health systems. It's becoming a more attractive option for both established practitioners, as well as residents and fellows recently completing training. The downward pressure on physicians’ incomes and skyrocketing malpractice insurance premiums are contributing to this increasingly popular option. Hospitals are faced with shortages of key physicians in many regions of the country, which makes it hard for those hospitals to maintain on-call coverage, much less think about expanding services. Those hospitals are increasingly willing to employ physicians - and offer very attractive compensation packages. Those packages often include student loan forgiveness and comprehensive benefits packages not typically available in group settings, particularly in smaller goups.
Is solo practice right for you?
If you are an individual that enjoys the business aspects of running a practice this is a practice model you may want to consider.
There are a number of advantages to solo practice. First of all, you're the boss. This is an attractive option for the entrepreneurial-mided, or if you aren't comfortable taking direction from others. Second, all the profit is yours, and you have control over practice overhead. You also have control over how the practice is run, and over choices that effect your lifestyle, such as the number of hours you work.
Most hospitals have bylaws requiring physicians to be on call a limited number of days (usually 10 per month) if you're the only specialist on staff or you can work out a call sharing arrangement with other physicians in the same specialty. The growing trend of hospitalist physicians is helping to ease the on call burden of many specialist.
There are some disadvantages to solo practice. When you're not working (whether because you're on vacation, taking a CE course, or sick) the office is closed, and you're not making any money. You must also manage a staff. That means hiring, firing, addressing raises and performance reviews, and a myriad of other personnel issues. Remember also that a solo practitioner,
you won't have a collegue in-house to bounce ideas off of about cases.
- Evaluate the employee vs. partnership tracts in the group. Partnership in a group typically involves having voting privileges that govern the practice and allow you to sit on the board of directors. Voting and partnership can equate to equality and equity in the practice. If there is surplus revenue at the end of the year, partners typically vote on how this money is used. Partnership is typically tied to how much money you bring in to the group. Evaluate the time it took other physicians to reach partnership and determine if this is financially feasible for the services you are providing.
- Don’t dwell on receiving a huge first-year base salary. Try to predict your career path. If you see yourself in the prospective group for a long period, a large first-year salary isn’t crucial, particularly if your goal is to become a partner.