Why It’s Okay To Make Money Owning Your Own Medical Practice
Earning what most people would consider a high income can evoke conflict for physicians, both internally and in the medical community.
This is especially common in the primary care space for both DPC and concierge practices, and it largely boils down to the great empathy physicians have.
Physicians see themselves as public servants. They want to help as many people as possible, which may seem to mean making prices as low as possible.
I have a different take I’d like to share about physician income. It’s a politically charged topic, I know — but hear me out. I’m passionate about concierge and DPC physician income because I believe it affects not just your bottom line, but your patients, the membership-based practice niche of healthcare generally, and the medical industry as a whole.
Why Physician Income Matters
The altruistic physician mindset may lead you to think, “If I charge more, fewer people can afford it, and that’s not helping as many people as possible.”
But undervaluing your services and charging only the minimum to get by isn’t a long-term solution — for your patients nor for the primary care industry.
Why? Your patients really need you, and they need you to be around for more than a few years. If you give and give and give with little return, eventually, you won’t have anything left. And the effects reach even farther than just your private medical practice.
Secure Your Oxygen Mask First
Work-life balance is a difficult dance most doctors perform daily. And the more patients you have to see to keep your practice running, the more difficult that dance becomes.
If you keep your prices low so more patients can afford your services, the time you’re able to spend with each of those patients has to diminish. It can even become difficult to create healthy boundaries. If patients have your cell phone number, then the more of them there are, the less likely you are to have uninterrupted time for your family and/or yourself.
Though you want to be present for your patients, you also want to be present at your daughter’s first soccer game, the gym, and family dinner. Spreading yourself too thin doesn’t benefit anyone in the long run.
The result of a hundred more patients in a physician’s panel because of low pricing is very often an overtaxed doctor, work-life imbalance, and eventual physician burnout.
You’re a physician, yes, but you’re also a human being who needs to be present in your life. And you also need compensation that’s commensurate with all the years of education and training, all the sacrifices of personal energy and family time you’ve chosen to make to provide this service.
Valuing your time and charging enough for your services are the keys to balance. Staying in control of your hours and your income allows your empathy for patients to stay balanced with the rest of your life. You may see fewer patients, but you can focus longer on each one and provide the excellent care they deserve.
Keep Medicine Healthy
The landscape of medicine has changed.
The Association of American Medical Colleges (AAMC) reports a projected primary care physician shortage of 48,000 in the U.S. by 2034. Non-primary care specialties could see a shortage of 77,000 or more. We’re at a tipping point that needs to shift — and quickly.
Consider some of the career paths that traditionally attract bright, capable young students: law, finance, and medicine.
What factors will the intelligent, goal-oriented 17-year-old weigh?
- How long will education and training last?
- How much student debt will they incur?
- What is the earning potential?
- How long will it take to repay debt based on earning potential?
- What kind of quality of life will they have?
- Does the earning potential compensate for any downsides in quality of life?
In this light, medicine is an incredibly daunting career path. It’s a 10–12 year commitment just for education — undergraduate studies, medical school, residency, and fellowship. And income during those years is either nonexistent or nominal.
Compare that to the far shorter time and less expense needed to become a lawyer or an investment banker, and you need some powerful motivators to draw the best and the brightest to the medical field.
When you consider the income potential versus the time investment and sizable student debt, it’s no surprise that more and more students are choosing other professions. Of course, some still choose medicine. But many now make a different choice, and medicine misses out on some really great potential physicians at the legal and finance world’s gain.
Simply put, banking and law offer a shorter education path and higher earning potential.
Tellingly, in a 2017 survey of 5,000 physicians, nine out of 10 wouldn’t recommend the healthcare profession to their own children. Additionally, burnout rates have steadily increased in recent years, even as income levels have fallen in traditional fee-for-service practices.
With this outlook, today’s highly capable youth aren’t inclined to travel the long road to becoming physicians.
But if they see doctors today making good money, providing great service, with a good work-life balance, then more promising young students will once again choose the path of medicine.
Bolster the Business Model
Along with a shortage of physicians, we’re seeing fewer physician-owned practices. Becker’s ASC Review reports that physicians now own less than half of all practices, and only 26% of physicians still work in private practice.
This is a very new development. Of the 135,300 hospital- or corporate-owned physician practices in the U.S., more than a quarter were acquired in the last two years.
The bottom line is that today fewer and fewer practices are physician-owned and under physician control. And where that’s the case, burnout and dissatisfaction increase.
Health systems and insurance companies ask physicians to see more patients and fill out more paperwork. In such settings, physicians are employees, and they aren’t in control of their time or revenue. They’re paid less, but work more. They’re squeezed at both ends, and that affects patient care.
Within this whirlwind, membership-based medical practices have an opportunity. In this business model, physicians are valued and patients are satisfied. In DPC and concierge practices, physicians can earn an income that’s in line with the value they deliver to patients. The excellent service they’re able to provide results in a high patient retention rate — ranging from 85% to 99% according to a recent ROAMD member survey.
But only a small percentage of the practices still under physician control are concierge or DPC practices, which is all the more reason to expand this style of medicine and make it attractive to future physicians.
Secure the Future
When a physician owns their practice and secures a commensurate revenue stream, we see a healthy dynamic between doctor and patient. We also see exceptional patient care and work-life balance.
This is absolutely fantastic. But what happens when that physician retires? Do the doors just shut, and the patients find somewhere else to go?
The last factor I want to talk about is passing on your knowledge to a younger generation of physicians.
We need more young people pursuing medicine. It’s just a fact. And to achieve that, we need to show them that primary care can be both lucrative and effective — especially in membership-based medicine.
We need people completing medical school knowing how to succeed with the concierge model. Medical school doesn’t adequately teach them this. But when we make the business model reproducible by teaching others, we’ll see the gaps and shortages start to fill.
Profit isn’t a four-letter word. Profit is the carrot, drawing people to one career or another. You can’t chase people into medicine with a stick.
But when you reach your highest level of success, you become a beacon to the young, intelligent minds that are the future of medicine. When you engage young minds and get them excited about pursuing medicine — especially concierge medicine — you propagate the exceptional patient care you value.
And on the last day of your practice, you can confidently toss the keys to the next physician in line.
Remember, you’re not going it alone. ROAMD is a network of concierge and DPC physicians who all value patient care, personal well-being, and constant improvement. Get involved with a network of peers that supports you to be independent, not alone™.
Dr. Scott Pope serves as the Chief Growth Officer at In Scope Ventures, a growth consulting firm focused on early stage healthcare companies. Scott is passionate about healthcare entrepreneurship and has been involved in various advocacy efforts to promote innovation in the industry.
Scott earned his PharmD from Ohio Northern University, where he participated in Habitat for Humanity, Phi Mu Delta, Order of Omega, and NCAA basketball. After graduating from ONU, Scott completed a pharmacy residency at Cone Health, followed by a specialty residency in infectious diseases, internal medicine, and academics at Campbell University and Duke University Medical Center.
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