Employees v. Private Practice

[Birdstrike]

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As an EM physician, just curious:

Are dermatologists following the trend towards going to work for hospitals and large systems as employees like other specialties are, or do most Derm residency grads still go into private practice?

 

[asmallchild]

As an EM physician, just curious:

Are dermatologists following the trend towards going to work for hospitals and large systems as employees like other specialties are, or do most Derm residency grads still go into private practice?

Would love it if others could chime in with their experience. I have personally found this to be very regional. In certain areas (Florida most notably from what I've seen), there is a trend towards megagroups (and it's still early. Many are still in the process of accumulating as many practices as possible with the eventual goal of selling out for a large lump sum)

In most areas, I would say the trend is to go into private practice (rarer and rarer to go completely solo, mostly small to moderate sized single-specialty groups)

I can't say if it's just graduates from my program but there has been a small blip recently of residents opting to stay in academics. As you can surmise, most dermatologists will try to avoid the hospital like the plague. (And it's reciprocal. Dermatologists don't bring in a lot of money to most hospitals and they would rather have their outpatient space going to a surgeon who can attract patients to the ORs)

 

[doctalaughs]

As an EM physician, just curious:

Are dermatologists following the trend towards going to work for hospitals and large systems as employees like other specialties are, or do most Derm residency grads still go into private practice?

In my area the trend is definitely to join a large multispecialty system for young dermatologists. This is mainly because many private practice partners are taking advantage of their younger colleagues- ie paying lower salaries and stringing them along and then firing before they are partners. Or more commonly, never making them equal partners.

Of course I suspect this problem is worse in other specialties for a few reasons. For derm the bar is lower to start your own solo practice. Its still a risk but not impossible. And most dermatologists are not beholden to any sort of hospital contract or hospital admin pressure. However, particularly in saturated areas there still is the issue of predatory private partners/ groups and surprisingly you can often make more money with less B.S. by joining a large system.

 

[DermatoFIGHT]

I think one of the best things about dermatology is staying in private practice versus becoming an employee. Being an employee is a nightmare. I think you will find many more females joining groups as many have said they do not want to work full-time or do not want to think about business related issues.

 

[reno911]

At the end of the day, both large multispecialty groups and private practices will take advantage of you in that they will pay you probably less than what is "fair". However, the latter situation has the possibility of partnership, at which point you really can't be taken advantage of. In my experience, with most derm private practices it's pretty easy to tell if partnership is on the table . If they tell you yes and are specfic about the process, then it is. If they say no or maybe, then it's not. It's pretty simple. You will have the occasional situation where the time comes for partnership and they decide they don't like you enough to want to be partner. But I think a large percentage of the time it's just that you're not a good fit -- and not that they had a grand plan to screw you from the beginning (although that is sometimes the case).

I still think that the best option for most graduates is to just start a private practice on your own. At the beginning, it will be very hard and you will make a lot less. But after a couple of years of work you will be in a far better situation than if you had done anything else. It's true that there might be some highly saturated parts of the country where it is hard to set up, but those areas are rarer than you think. I think the biggest reason residents dismiss this option is that it is scary. There is no guaranteed salary and no one in residency teaches you how to really run a practice. These fears are compounded by the fact that graduating residents are in a lot of debt. However, these fears are short sighted. In most cases if you just take the plunge and start your own practice, in a few short years you will be much happier and better off than if you had done anything else.

Of course, the above only really applies to general derm. For subspecialties, it's an entirely different story.

 

[aau22]

What do you guys think is the average cost to start up your own practice? What kind of cost to buy into a practice is reasonable? I know the latter depends greatly on value of the practice, revenue etc. I was told by a former attending now in private practice to never accept a buy in that costs more than it would for you to start your own practice which he valued to be about 250k.

 

[FIREitUP]

At the end of the day, both large multispecialty groups and private practices will take advantage of you in that they will pay you probably less than what is "fair". However, the latter situation has the possibility of partnership, at which point you really can't be taken advantage of. In my experience, with most derm private practices it's pretty easy to tell if partnership is on the table . If they tell you yes and are specfic about the process, then it is. If they say no or maybe, then it's not. It's pretty simple. You will have the occasional situation where the time comes for partnership and they decide they don't like you enough to want to be partner. But I think a large percentage of the time it's just that you're not a good fit -- and not that they had a grand plan to screw you from the beginning (although that is sometimes the case).

I still think that the best option for most graduates is to just start a private practice on your own. At the beginning, it will be very hard and you will make a lot less. But after a couple of years of work you will be in a far better situation than if you had done anything else. It's true that there might be some highly saturated parts of the country where it is hard to set up, but those areas are rarer than you think. I think the biggest reason residents dismiss this option is that it is scary. There is no guaranteed salary and no one in residency teaches you how to really run a practice. These fears are compounded by the fact that graduating residents are in a lot of debt. However, these fears are short sighted. In most cases if you just take the plunge and start your own practice, in a few short years you will be much happier and better off than if you had done anything else.

Of course, the above only really applies to general derm. For subspecialties, it's an entirely different story.

doesn't starting your own practice require a great deal of capital? how are residents able to afford this when they leave residency; do they end up taking out (more) loans? would going into a group practice for a few years to make some cash and then starting your own practice be feasible, or would it be more preferable to start your own practice from the getgo?

 

[reno911]

doesn't starting your own practice require a great deal of capital? how are residents able to afford this when they leave residency; do they end up taking out (more) loans? would going into a group practice for a few years to make some cash and then starting your own practice be feasible, or would it be more preferable to start your own practice from the getgo?

It does require capital, but it's not too difficult to get a business loan or a line of credit. Betting on a dermatologist is pretty low risk for a lender. It also probably doesn't require as much as you think. When you're starting out you don't need a ton of staff, lasers, etc. The general plan is to start small but make sure you have the flexibility to expand as the practice grows.

You could certainly do what you say as well, but there are problems there too. Most people don't want to hire someone who knows they're going to leave for sure in a few years. I suppose you could hide your intentions, but I'm not a big fan of that approach. Also depending on the location, there may be non-compete issues to deal with. I think it's much better to just do it from the start.

 

[reno911]

What do you guys think is the average cost to start up your own practice? What kind of cost to buy into a practice is reasonable? I know the latter depends greatly on value of the practice, revenue etc. I was told by a former attending now in private practice to never accept a buy in that costs more than it would for you to start your own practice which he valued to be about 250k.

That seems reasonable, though you could do it for much less (or considerably more) depending on what exactly your goals are.

 

[FIREitUP]

It does require capital, but it's not too difficult to get a business loan or a line of credit. Betting on a dermatologist is pretty low risk for a lender. It also probably doesn't require as much as you think. When you're starting out you don't need a ton of staff, lasers, etc. The general plan is to start small but make sure you have the flexibility to expand as the practice grows.

You could certainly do what you say as well, but there are problems there too. Most people don't want to hire someone who knows they're going to leave for sure in a few years. I suppose you could hide your intentions, but I'm not a big fan of that approach. Also depending on the location, there may be non-compete issues to deal with. I think it's much better to just do it from the start.

thanks for the post. i'm definitely not one for hiding my intentions and would love to practice on my own rather than have to appease partners.