opening a practice?

[bearpaw]

I was just wondering how does one go about opening a practice. Like, do you have to work for someone else after residency/fellowship or can you just open your own? THanks.

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[Flack Pinku]

I think private practices are becoming rare now, especially right after residency. Usually, depending upon your practice and the town/city's needs, you'll either join a hospital or an established practice/group practice.

Sometimes, town's or hospitals in towns recruit doctors of certain specialty that they don't have in their town, so for ex: if a hospital needs an Orthopedic Surgeon doing Spine surgery, they may want to recruit someone who has a Spine fellowship, and help them establish a "private" practice in the town...

 

[bearpaw]

I guess I am not being clear... I mean, do you know HOW a person generally opens a practice? Like, if i work for a hospital, do i get my patients from the hospital and refer them to my own practice? Basically, i just want to know the road to opening my own practice.

 

[Kalel]

Well, private practice is the same as usual, but solo practices are certainly disappearing. It sounds like you are interested in starting a solo practice. I have a cousin who was interested in doing the same a while ago, and he told me that it'd take ~300-500K in start up cost in order to pay for the rent, equipment, staff, etc; plus have a little bit left over to live off of since most practices are in the red when they start. These days, not only do you need a tech to bring patients back to their rooms and set them up (ie blood pressure, draw blood, run ECG's, etc), you need a receptionist to answer the phone, schedule patients, and sign people in and you need a person to haggle with insurance companies for reimbursement and to fill their forms out properly. A lot of people purchase practices from physicans who are moving, this can be done for anywhere from 300K to several million dollars depending on the practice. What you end up purchasing is all of the moving physicians charts and patients so that you have an "established" patient population that is used to seeing a physician in that particular office, and sometimes, their support staff stays as well. Of course, many patients may choose to not stay when the physician leaves. The other way to get patients is just through word of mouth or advertising. A lot of clinics rely on patients referring them other patients to their clinic, that's one reason why new clinics are usually in the red for several years after the initial start-up; it takes a while to build up a patient population. Anyways, these days, more and more physicians are joining group practices because you have more negotiating power with insurance companies for reimbursement rates and you can pool your risk together in things like malpractice to get lower rates there, plus you end up needing fewer staff (eg one receptionist for 3-4 physicians instead of the 1 to 1 ratio) and you can share equipment. Opening a solo practice is similar to starting a small business, in that there's a significant personal finacial risk associated with it, and it usually takes a few years for it to become profitable.

 

[bearpaw]

Thanks for your input. I know a GI who has an office where he does all his camera stuff at an endoscopy clinic near my house, so it seems like his start up costs are minimum. He has two people working, a nurse and a receptionist, and he is doing really well. Basically, that is what i am working towards i think. Is that something realistic? On sdn, it seems like people are geared towards saying doctors don't make very much, their lucky if they get 400k a year, but in real life the people i know are doing much better than that and they all opened their own practice. I don't want to work for someone else because the owner of the practice is basically capitalizing off of me (if he pays me 400k-700k, he certainly is making much more off of me). Plus, i think autonomy would be better.

Anyway, i am starting school in the fall, i'll figure it out as i go along i guess, but any additional input is always welcome.

 

[IlianaSedai]

400k a year, but in real life the people i know are doing much better than that and they all opened their own practice. I don't want to work for someone else because the owner of the practice is basically capitalizing off of me (if he pays me 400k-700k, he certainly is making much more off of me)

Who the hell gets ONLY 400k a year these days -- if ever? I think your idea of what your future will be like is waaaaay off base.

Suffice it to say, from what I understand of it, you 1) need at least a couple hundred thousand to start your business, 2) need insurance, and 3) need patients. (1) you can borrow, but I've been told (2) and (3) kinda depend on each other, so it's tricky because one tends to be unwilling to come without the other.

And as for where your patients come from-- I think that depends on what you do. For example, I know someone who is a dentist-- patients walk in off the street. However, all the oral surgeons and orthodontists he knows have to NETWORK in order to get the referrals from dentists. See what I mean?

So if you want to be a gastroenterologist -- who the hell will walk in off the street because they want a colonoscopy for the sheer fun of it? GI patients are probably referred by someone else.

P.S. I do think it's still possible to go solo practice, if you really want to, or to find a satisfyingly similar group practice setting that you enjoy.

 

[juddson]

Originally posted by bearpaw
Thanks for your input. I know a GI who has an office where he does all his camera stuff at an endoscopy clinic near my house, so it seems like his start up costs are minimum. He has two people working, a nurse and a receptionist, and he is doing really well. Basically, that is what i am working towards i think. Is that something realistic? On sdn, it seems like people are geared towards saying doctors don't make very much, their lucky if they get 400k a year, but in real life the people i know are doing much better than that and they all opened their own practice. I don't want to work for someone else because the owner of the practice is basically capitalizing off of me (if he pays me 400k-700k, he certainly is making much more off of me). Plus, i think autonomy would be better.

Anyway, i am starting school in the fall, i'll figure it out as i go along i guess, but any additional input is always welcome.

This makes me laugh. Do think you are going to make this much??

Judd

 

[Kalel]

While future salaries are difficult to predict, GI is currently a fairly financially lucrative field of medicine. A GI fellow told me that he was expecting to start at 350K plus, and I have a family friend who is a GI doctor who easily makes more then one million per year with a solo practice. Incidentally, how specialists in the private community recruit patients is pretty interesting too. I know that this one particular GI doc sometimes takes large groups of primary care docs out to dinner at nice restaurants to "advertise". A lot will do things like pay office visits, send gifts, etc. I'm not sure if this acting in the best interest of the patient, but I guess that these specialists have to make themselves known to PCP's somehow.

 

[nuclearrabbit77]

"taking care" of your referral sources is commonplace in all specialties that depend on them.

 

[bearpaw]

thanks for your input guys! it really helps me out. I am aware that some people think that medical salaries approaching and in the million dollar area seem kind of far fetched, but i guess most doctors my family knows are in that level. They are about all 35- 40 years old, FMG's, and basically just started practices and are doing well. I figure if they can do it, so can i.

 

[kito]

I think that a little financial savvy can go a long way. The object (financially speaking) should be to build an asset base, not necessarily a salary base. I would happily sacrifice a large portion of salary to be properly diversified. Cash is one kind of asset. It is clearly not the most lucrative asset.