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The Business of an Independent Physician Practice

independent physician practiceNegotiating the medical system can be a full-time challenge for some patients. As a healthcare consumer, you face hard-to-overcome hurdles that can stem, in part, from a lack of clarity about coverage processes and procedures. What you may not know, however, is that physicians, too, operate under uncertainty. They certainly do this as they choose their professional paths within the ever-changing medical landscape. Perhaps the biggest decision a doctor makes – other than committing to an area of specialty – is whether to work as an employed physician as part of a larger health system, or start an independent physician practice.

Why would a doctor go independent?

Some physicians resent the restrictions placed on them when they are employed in large medical networks. In contrast, two significant pros await doctors who strike out on their own – along with at least one con.

The High-Level Nutshell 

Practitioners strive for healthy physician-patient relationships. In the “Code of Ethics” of the American Medical Association (AMA), the opening paragraph states that trust is the basis of the relationship between doctors and patients. Because doctors embrace ideals, as well as science, some aspect of job satisfaction stems from working in an environment where ideals can be met.

Worth noting, one study from New York’s NYU School of Medicine showed that independent doctors in the state were less likely to suffer burnout. One key factor reported in the results was a strong patient connection. The other key factor was an increased sense of autonomy.

Related: Which Income Class Are You In? How Do You Rank?

Autonomy

Doctors in an independent physician practice have the freedom to create and implement their own vision.

This involves partnering with physicians who share similar…

  • philosophies,
  • values,
  • expertise, and
  • choosing competent, dedicated registered nurses and staff,
  • and finally, hiring strong office managers who operate using sound business solutions.

Those in independent practices often market through valued peripheral endeavors, running the gamut from simple to complex:

  • They publish informational newsletters that fit the practice’s personality and mission. This is in contrast to public relations missives required by communications departments.
  • They create educational opportunities for the larger community in venues and on topics of their choosing, rather than those dictated by a behemoth health system;
  • And also, they dispense wellness advice rooted in sound practice, instead of medications handed out by drug representations.

Further branching out, they might pursue greater sideline projects without fearing a conflict of interest. For example, a gastroenterologist’s expertise would add weight to the guidelines and content of a book about anti-inflammatory diets and nutrition.

Those who thrive on extreme challenges might undertake extended entrepreneurial enterprises that fit their talents, experiences, and specialties. It is worth noting that investors currently see compelling opportunities in medicine. In 2018, in just one month alone, venture capitalists stoked healthcare startups to the tune of $2.8 billion.

Patient Care

Independent providers manage service to patients at levels that might be impractical within large networks tied to health plans. To an extent, doctors can better focus on patient needs when the practice has the flexibility to determine the number of patients it accepts. Additionally, care is increasingly individualized in practices that focus on performing significant procedures in their own clinics. As an example…chemotherapy infusions or orthopedic imaging.

An empathetic and flexible approach to patient care opens up progressive treatment options, including employing exciting new models of personalized medicine. As an example, Dr. Harry Stylli – healthcare investor, entrepreneur, and chair of diagnostic testing developer OncoCellMDx – notes that “in the last twenty years our understanding of genes and their relationship to health and disease has increased exponentially.” Emphasizing that personalized medicine, when incorporated into mainstream care, offers life-saving potential.

That Caveat

Those who choose to go it alone are, at minimum, entrepreneurs at heart; staff, peers, and customers (patients) depend on physicians to implement innovative, sound business steps so that they and their practices thrive.

Still, the reality of owning a business in conjunction with practicing medicine can place significant demands on the lead doctor. For one thing, medical school does not provide the training for running a business as would an MBA program. Additionally, the business side requires working extra hours on top of performing patient duties and working with insurance and regulatory entities.

One possible solution is to bring nonphysician providers into the practice. This can serve as a way to distribute the load, bringing in greater profits and increasing efficiency. Being able to delegate is especially important since the passing of the Affordable Care Act in 2010 has placed an increased burden on health care providers in areas of billing and patient record-keeping.

Uncertainty

The struggle to keep up could perhaps spell doom for the independent physician practice. Consider the house-call general practitioner.

In a 1948 photo essay for Life Magazine, titled “Country Doctor.” W. Eugene Smith shadowed a physician on rural house-calls over 23 days. The doctor provided a range of procedures, from stitching lacerations to giving shots. The photo images do seem of another era, one forgotten. Yet, that practice has seen a reawakening with the advent of concierge medicine, where patients pay retainer fees for enhanced care that often includes house calls.

In a profession of idealists, there is a strong possibility that innovative, disruptive strategies will emerge that will enhance the independent model.

Are you considering an independent physician practice? Why or why not?

Money

AUTHOR Derek

My name is Derek, and I have my Bachelors Degree in Finance from Grand Valley State University. After graduation, I was not able to find a job that fully utilized my degree, but I still had a passion for Finance! So, I decided to focus my passion in the stock market. I studied Cash Flows, Balance Sheets, and Income Statements, put some money into the market and saw a good return on my investment. As satisfying as this was, I still felt that something was missing. I have a passion for Finance, but I also have a passion for people. If you have a willingness to learn, I will continue to teach.

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