Private practice vs hospital employed

[Footballfan8001]

Hey all,

Third year in med school hopefully entering the ortho field. My question is about private practice vs hospital employment. How exactly does that work? Is it still common for ortho docs to be in private practice (haven't found anything recently discussing this)?

If possible, it would be nice to hear about comparisons of the two with regards to
1) hours/schedule flexibility
2) salary
3) freedom in dictating how you practice (with insurance and government changing things all the time)
4) chances for innovation (coming up with new surgical equipment, refining current products, etc)

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[docr3]

Bump

 

[BusySurgeon]

Hey all,

Third year in med school hopefully entering the ortho field. My question is about private practice vs hospital employment. How exactly does that work? Is it still common for ortho docs to be in private practice (haven't found anything recently discussing this)?

If possible, it would be nice to hear about comparisons of the two with regards to
1) hours/schedule flexibility
2) salary
3) freedom in dictating how you practice (with insurance and government changing things all the time)
4) chances for innovation (coming up with new surgical equipment, refining current products, etc)

I previously worked in two private practices — partnership track jobs and am now in a hospital employed position and think this was the best career decision of my life.

Obviously this will vary from practice to practice and location but my current job is so much better than either of the past two

The older private practice model is not as lucrative as it once was. With declining reimbursements and changes in insurance coverage it seems increasingly difficult for surgeons to cover the increasing overhead of a large practice.

I still can remember how demoralizing it was to sit at the partner meetings after working 80hrs per week for a month and look at the income statement for my group and see a negative income in my column. I didn’t understand how I could be working so hard and not being able to cover my own salary. How can you do work for a month and then owe money to your employer?


A private practice is a small business and i had no training in that as part of my medical education I tried to learn on the job but I was dealing with guys who had been running these practices literally before I was born. It didn’t seem fair.

In my experience it felt like I was going to be buying into a pyramid scheme where the senior partners were benefiting from of my hard work.

Now working for the hospital I get paid for the work that I do. I don’t worry about the insurance; every case I do I get reimbursed by the rvus. This is completely different than private where i may or may not ever get anything for all the emergency cases I was doing.

I’d be taking the majority of the call for the group and waiting for an OR to free up after 6 or 7pm to start fixing an ankle, or a hip etc. from call following my partners full day of elective total joints.

Now I get tons of direct referrals from the hospital and it’s network of employed primary care docs. I know the referring docs, we are part of the same group, they have my cell phone number and they send me tons of patients. Anything they want to refer to me I’ll take it. The hospital’s incentive is for me to get busy as quickly as possible and i want to be busy because I get paid for every patient I see and every procedure I do.

Win-Win

 

[docr3]

I previously worked in two private practices — partnership track jobs and am now in a hospital employed position and think this was the best career decision of my life.

Obviously this will vary from practice to practice and location but my current job is so much better than either of the past two

The older private practice model is not as lucrative as it once was. With declining reimbursements and changes in insurance coverage it seems increasingly difficult for surgeons to cover the increasing overhead of a large practice.

I still can remember how demoralizing it was to sit at the partner meetings after working 80hrs per week for a month and look at the income statement for my group and see a negative income in my column. I didn’t understand how I could be working so hard and not being able to cover my own salary. How can you do work for a month and then owe money to your employer?


A private practice is a small business and i had no training in that as part of my medical education I tried to learn on the job but I was dealing with guys who had been running these practices literally before I was born. It didn’t seem fair.

In my experience it felt like I was going to be buying into a pyramid scheme where the senior partners were benefiting from of my hard work.

Now working for the hospital I get paid for the work that I do. I don’t worry about the insurance; every case I do I get reimbursed by the rvus. This is completely different than private where i may or may not ever get anything for all the emergency cases I was doing.

I’d be taking the majority of the call for the group and waiting for an OR to free up after 6 or 7pm to start fixing an ankle, or a hip etc. from call following my partners full day of elective total joints.

Now I get tons of direct referrals from the hospital and it’s network of employed primary care docs. I know the referring docs, we are part of the same group, they have my cell phone number and they send me tons of patients. Anything they want to refer to me I’ll take it. The hospital’s incentive is for me to get busy as quickly as possible and i want to be busy because I get paid for every patient I see and every procedure I do.

Win-Win

Thanks for the response! What has the difference in hours been like for you?

 

[OrthoRox]

I guess it depends on where you are in the country and what the local payor mix is like/what the group is like.

It might be that in a big coastal city (NY, SF, LA) you're better off accepting a average income, living frugally and being hospital employed - that's given the low rate of reimbursement on the coasts, HMO penetration, heavy competition (too many orthopedic surgeons), and sometimes a poor payor mix.

If you're in an environment/city where the payor mix is favorable, competition is OK (not an excessive supply of docs), reimbursement is still decent (private insurance pays 2x medicare etc - though it won't be for long), then private group practice can still be more lucrative. This type of environment is probably going to be in the midwest, or the south in a smaller non metro area. Thats just a reality. Its medicine, you have to go where providers are scarce to make money.

Its true though, as time continues, it gets harder and harder to make a significant income in private practice, even in a non metro area.

And yes when you start off, you have to justify your salary, probably take more call than not, and work long hours.


1. hours - private practice will be busy to start, entirely due to call, ironically your days will be empty because you have very few referrals at least for the first few months.
2. income - it depends on where you are in the country - in the coast, there probably isn't a huge difference between. hospital employed and PP; in midwest,south in non metro areas, once you make partner, superior reimbursement rates, ancillary income that still pays - you'll make more than a coastal surgeon employed by the hospital, sometimes 100% more, sometimes more than that. My partners certainly do.

3. freedom of practice - insurance companies will dictate a lot, but that's because surgeons in the past were operating when they shouldn't have, imaging when they shouldn't be - all to make $. It is what it is, there is still freedom to practice; it just takes a lot of paperwork to get an MRI or pre authorization for surgery.

4. Innovation - Actually a good question, probably the best one and one and one that should be asked more often. How do you innovate and make 4 mill/year like Neal elattrache, or 24 mill/year like Burkhart, or millions like Anthony Romeo, Bonutti, Howell, Berger etc etc etc....they're not making that from their clinical work, it's from their device patents.

Well you either need to have an actual idea (not very common), or you need to partner with a powerful company - like Stryker, SN, Zimmer, Arthrex....and they have to have a reason to hire you to speak (surgeon for big time pro sports teams, well published and well spoken researcher at a prominent University, a reason why people would listen to you)...then once you've partnered with them, you slowly slip yourself into product consulting...then product development...then boom, you've got your name on a patent application even if you didn't have too much to do with the idea...you nudged it along and gave some clinical input.

Then you're set!

For that. you need to be at big institution/have your own institution, and be well published. A lot of ortho researchers publish so they can cash in through device development. Which I think is quite neat.

 

[Innocent2]

For that. you need to be at big institution/have your own institution, and be well published.

That is usually neither hospital OR private practice. That is academic usually. A lot lower pay.

 

[Innocent2]

You have good advice above. Most likely PP will be part of a group. Although their are different business models, the practice provides a lot of the services, but you as a physician pay for it. Your role is to generate revenue. If your subspecialty fills a gap, then you have a base to build upon. If not, then you are starting from scratch. Some PP are open and democratic while others intentionally are toxic and use new attendings as a profit source.

Look at Medscape comp surveys, ultimately PP will pay more.

 

[ChiDO]

Your own boss vs employer basically. I choose to be my.own boss and joined a pp. My first two years I'm giving up the $500k hospital salary, but over the long haul, my ancillary income with be more than a hospital employee's salary.

As mentioned above, if you wanna just work and get paid without worrying about anything, go be an employee at a hospital. To me, that sounds horrible. Every situation is different though.. Just a random example n=1, my employeed buddy can't get the hospital to fire his MA and get him a new one. To each their own.