Forbes, "The Private Medical Practice Is Not Dead Yet"

Published June 16, 2015

By Larry Myler

There is a common assumption regarding a large percentage of physicians in the US: The private practice is on the endangered species list, and all doctors will soon be working for big healthcare providers. If this supposition turns out to be true it would represent the demise of a long-standing and cherished method of healthcare delivery. From an entrepreneur’s viewpoint, it would be the end of a large number of small businesses—eliminating a lot of support staff jobs as well. Not good news. But is it true?

It is true that a number of healthcare providers have been snapping up doctors as employees. It is also true that the Affordable Care Act and other regulatory and market factors have colluded to entice some physicians into making the transition to seemingly easier, salaried positions in hospitals. However, the trend towards joining large health providers seems to have leveled off and may even be reversing.

There appear to be two reasons why this trend is slowing, and they are both directly related to profitability: 1) the “doctor-buying binge” strategy might not be paying off as expected for providers; and 2) private practitioners themselves are finding ways to become more profitable and make their small businesses more appealing.


According to a February, 2014 article in Modern Healthcare, the median loss for employing a physician was $176,463 in 2012. This revelation has some analysts predicting a pullback in the hiring of physicians going forward. Also, Becker’s Hospital Review recently reported on a spate of layoffs taking place this year within various health systems. Current revenue realities may not be supporting projected performance in the healthcare industry. And that is changing the metrics of doctor hiring by health groups.

As for making their practices more profitable and appealing, many physicians are becoming more entrepreneurial by working on the business side of their businesses. Dr. Jed Shay of the Pain Care Center in Rock Springs, Wyoming was struggling to stay organized and profitable in his private practice. “Small physicians are leaving and joining bigger groups because they cannot contain costs, and I didn’t want to give up my independence because I failed to manage my practice,” remembers Dr. Shay. So he sought outside help from a company that specializes in giving doctors the tools necessary to succeed; tools that doctors don’t traditional learn about in medical school. ADP AdvancedMD President Raul Villar looks back on Dr. Shay’s transition to bring his practice up to speed. “AdvancedMD’s mission is to allow independent medical practices to be profitable doing the right things for their patients. When Dr. Shay let us know about his challenges we knew we could help because we have helped over 17,000 physicians do exactly what Dr. Shay was needing to do.”

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