*Private practice refers to a privately-owned practice, especially one operating under s system of free enterprise or laissez-faire captalism. It describes a physician-owned practice, one that is not owned by an entity such as a hospital, and it is broadly used today to refer to solo and/or partnership practices of varying structures. Unless you hold some level of practice ownership, you are an employee and you need to identify your employers before you sign a contractual agreement.
* Identify the group’s short-term and long-term goals. This will help you decide if your goals match the goals of the group. If you want a busy outpatient practice then you must step in to fill a vacancy in a busy, established practice or your must build it. How will the group help you to do that?
I brought in one physiatrist who interviewed with the hospital CEO and administrators to consider an opportunity to either take over an established hospital-based and staff-supported inpatient/outpatient practice or to become a hospital employee with benefits. Benefits were the dealmaker, but at dinner the CEO offered an unplanned glimpse into the practice environment when he asked the physician her thoughts about his idea to restructure the inpatient unit. It was a very astute physician who later told me that the CEO wasn’t really asking for an opinion;he was simply trying to determine if she would buck him.
* You are primed to be an employee in a system when you can identify and happily live within an organizational structure that neither seeks nor desires your input.
I met with a physician who had just given notice to his group that he was leaving. He was extremely frustrated and had no alternative practice plan in place. Two years earlier he had signed a contract to join that group with the understanding that he would be offered a partnership. Time passed with minimal partnership discussion and he became so disgruntled that he finally made the decision to leave. As I spoke with him, it became clear that the particulars of that partnership had never been provided.
* A well-organized group will provide you with key information even before you ask. A group that is not organized will barely be able to respond to your questions. All groups fall somewhere along that continuum and you will want to gauge the level of the group’s organization since it will play a major role in your practice satisfaction.
Most physicians have a primary desire to practice medicine. Most would choose to forego the cumbersome paperwork and the persistence required to advocate for the patient when arguing with insurers. One physiatrist told me of the time spent in justifying the need for a wheelchair for a quadriplegic patient.
One physiatrist expressed an interest in building a part-time practice performing only EMGs. That physician was obviously well-informed about medical billing and he desired to build a practice with only high-level billable codes. If you entered into practice with this physiatrist on production-based compensation, what type of practice could you expect to build and how much money might you earn monthly?
- Determine the primary needs of the patient population in the practice area.
As an employee, you will receive financial compensation based on a salary guarantee, production, or a combination of both. A salary guarantee is an amount you can bank on, literally, and it may be a great way to start up your practice. However, no group will want to continue to pay you more than you earn. It just isn’t good business. That means it is expected that your gross charges will increase as you build your practice. Your earning potential will typically be tied to the revenue you generate (production-based) for your group and this is an important point to consider as you begin your contract negotiations.
- Production is typically not the best option for a start-up practice for several reasons. It takes an investment of time and money to build a practice and this may be one of the most underestimated aspects of medical practice start-up.
Retirement benefits within a group practice may exceed those available in hospital-owned practices, a notable advantage. Group practices tend to invest the maximum allowable amount, $30,000 annually, into each retirement plan for each physician in the group. In some groups that money is self-directed so each physician can elect his or her own investment options independently of the group. Hospitals, however, have a different set of governmental guidelines as not-for-profit or for-profit entities, and are thereby limited in the amount that they can invest in the retirement plan for their employed physicians. In addition, there may be limited investment options for physicians in those plans. This is an important point to include in physician compensation when comparing practice opportunities and negotiating salary compensation.
By Kathy Jeffries, MyraPhyx A Physician Resource Group, [email protected], 573-680-3105