What can I expect from a PM&S 36????

[347932]

Newankle,

The reason its so expensive is for many of the "costs" you didn't mention. You mention how much you brought in yourself, but what did the practice generate? It is likely that for you do bring home that much, one of the partners had to sacrifice their load to help you with yours. This is a conscious decision so I'm not trying to belittle your effort, but this is likely the case.

I've had similar experiences as to what you mentioned as a "buy in". Several of the older docs tried to do this with their associates and their associates left. Some docs aren't the best business people and haven't secured their retirement as they should have and hoped to do this by "selling" their practice to the highest bidder. It just doesn't work that way. Who has that kind of money to invest in this economy? There are two practices like that locally and now the older docs are miserable because they are "forced" to work to maintain their lifestyle and made mistakes with their employees in this regard. Not all are like this, but I can only speak as to my experience so far.

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[Podfather]

Why is it such a burden it is to take on a new associate? I don't see how it takes 2-3 years for a group to recoup what they put in for a new associate in any specialty as you say. When I started as an associate in a podiatry practice I got paid a base of $80K plus incentive-based bonus. I took home around $120K on collections around $300K and so "the practice" made $180K and decreased their call burden. Aside from the value of sweat equity, referral sources, etc of which it's impossible to put a price tag on, they spent money on me for dues/malpractice/health insurance/supplies which totaled maybe $20-30K. Adding an associate to a larger practice really doesn't increase the overhead a lot as it may in a smaller practice and I actually lowered the overall health insurance rates for the practice being by far the youngest and healthiest. I "paid for myself" at about $220-230K in collections.
Now I must rant on partnerships. In my job with the podiatry practice partnership buy-in was going to be over $300K (in a small podiatry practice). In my job with the ortho practice my buy-in as a full/equal partner was less than that and this is in a large ortho practice that collects over $13 million a year. To me partnership is for job security, commitment to the practice and ability to have input/call the shots but not really to make more money. I don't understand why many podiatry practices I have seen make the partnership buy-in so expensive. It's set up so that the practice has to make money on you for a number of years before you may be offered partnership. I'd like to hear from others what their partnership buy-in situations are/were, what it's based on and how they feel about it.

It's not a burden but it does cost money. First of all many of the orthopedic groups are given recruitment money from the hospital and usually podiatrists are not. Second it is very rare for a practice to break even on a new associate for the first year. It takes many months to get on the insurance plans and for the new associate to get up to speed. You can do it but in smaller practices it is rare. Remember often (in the right practice) the new associate is given patients that the senior member(s) may have seen so even if you make your nut they may have made less that year. If overhead it 50% then whatever you are paid and other costs you need to collect double that amount just for the practice to break even. Larger ortho groups also have more people to absorb the fixed costs vs a smaller DPM group.

 

[PADPM]

How much of posters' "experience" with salary offers has to do with geographic location? I ask because now that I'm a student, information I've gotten from current graduates doesn't add up with what PADPM and Kidsfeet regularly post.

I understand that PADPM is part of a large and successful practice, but I also know that he practices in PA/NJ. I'm assuming Kidsfeet is in the Northeast as well. But just over 100k for a 1st year associate at a "large, busy, successful, etc." practice seems low.

Especially when you've heard first hand and in some cases seen contracts in the mid 100's (plus % of billable services incentives). Maybe it's because these students come from better residency programs (the ones coming to present at our school). But these contracts seem to be more than just "the exception".

Maybe someone like Natch could chime in? Of course all the those people running around in Chacos probably drums up a lot of business...

dtrack,

Remember that I've stated many, many times that I post with anonymity on this site. So although somewhere the states PA, NJ, NY may have been mentioned, or my avatar states "East Coast", you may not truly know where I practice, so please don't make "assumptions".

My glass is not half empty and I absolutely have a full understanding on the up to date job market and offerings of today's residents. Sorry if my observations are not what people want to hear, but I'm simply being honest based on my experiences with residents and placements throughout the country not just in "PA/NJ/NY".

Similar to Podfather, I have had former residents who have had job offers that rival what I'm earning or surpass what I bring home in a very short time. However, I believe that at the PRESENT time, there are many, many graduates taking a lot of jobs for salaries well below those being posted on this site. But please remember, I have stated many times in the past that I believe in the long run many of these incomes will eventually balance out after several years.

Our practice offers a fair starting salary with the hope that the associate will be on the track for partnership. When that happens, we don't ask for an unrealistic buy-in, but "give' the associate shares as a reward, hence the realistic salary. We also raise the salary when production increases.

Newankle did make his former podiatric practice money, but over simplifies the overhead situation. If overhead runs 50%, etc., it involves an overall cost for every aspect of the practice, including the associate. It doesn't mean that overhead expenses are independent of the associate. Often associates believe that the overhead existed prior to their existence, therefore when they arrive any income they make is pure profit and does not add to overhead, which is simply not true. It's not quite that simple.

Regardless, I am extremely happy that the salary trend is increasing for our new graduates, but I'm also very well in tune with the highs, lows and average. And I would also caution anyone to not always be so impressed with what others TELL you unless you've seen the contract.

I've had colleagues brag about how much money they are making and how many surgical cases they perform weekly, etc., etc. A year or two later that doctor is calling our office to see if we want to purchase his practice and we look at his records and he's performed 10 surgical procedures in 2 years and his practice is barely making a profit.

Work hard, aim for the stars and you will make an excellent income. Stop trying to figure out what your starting salary will be, because in reality, you're not going to know that number until you receive your first offer.

Until then it's ALL speculation.

 

[347932]

PADPM,

You and I are definitely on the same page. What I think, you say. Amazing.

 

[dtrack22]

Remember that I've stated many, many times that I post with anonymity on this site. So although somewhere the states PA, NJ, NY may have been mentioned, or my avatar states "East Coast", you may not truly know where I practice, so please don't make "assumptions".

I know you post with anonymity, but you have to remember that even seemingly trivial pieces of information can "out" you...so to speak. Things like your son playing soccer, getting mailers from Urology societies (meaning there's a urologist with a similar name), former involvement in a residency program, etc. all give someone who is good with a search engine the ability to find out who you are. Not saying I, or anyone has, just a reminder.

I'm more curious to hear your response to podfather's post?

Guys sorry but 95% of our residents make six figures as a base right of residency. The average in a non multi-specialty/ortho practice is 125,000-150,000. For those joining multi-specialty/ortho they average 150-175,000. One this year, has already been offered 200,000.

Most of the better offers are south and west because the average age of patients is two to three decades lower than the north/northeast. Therefore 40 patients with non palliative problems (most requiring xrays and other income producing care vs an E/M or RFC code) per day means higher reimbursement.

 

[PADPM]

I know you post with anonymity, but you have to remember that even seemingly trivial pieces of information can "out" you...so to speak. Things like your son playing soccer, getting mailers from Urology societies (meaning there's a urologist with a similar name), former involvement in a residency program, etc. all give someone who is good with a search engine the ability to find out who you are. Not saying I, or anyone has, just a reminder.

I'm more curious to hear your response to podfather's post?

Ah,dtrack 22,

Good try, but please remember, this " 'aint my first rodeo". Please give me a little more credit. I am fully aware of the search capabilities of the internet and the inquisitiveness (is that a word?) of some of the young docs/students on this site. As a result, I have taken every precaution to remain anonymous, and I assure you that despite your best efforts, you have no clue who I am.

I have received many, many PM's who thought they "figured out" who I am based on "clues". Although the information I have provided regarding my credentials and practice demographics and practice history is 100% accurate, there are other little pieces that I may have deliberately used to throw people off track at times.

To address some of your comments;

1) My name PADPM is of no significance, and is an inside joke that only two people understand. It's derivation is similar to the way the band Lynard Skynard was named.

2) Although my son does play soccer, I can also name two other DPM's who are also members of successful group practices who's sons also play division 1 college soccer. I've never mentioned the school, if he is still playing, if he has graduated, etc. There are a LOT of soccer players, and as I stated, I personally know of 2 other DPM's who have sons playing. So keep searching.

3) Your "theory" regarding how I got on the mailers from the Urology society is actually quite amusing. Your "assumption" that it is because I have a similar name to a urologist is pretty imaginative. In actuality, I do not get mailings, I must have been placed on an email listserv. Our practice utilized a medical "career" search organization to advertise for an associate position for our practice. Following that ad, I (and my partners) started receiving emails advertising available positions for urologists. I guess that somehow the companies system screwed up.

However, if you would still like to believe YOUR theory, feel free to obtain a list of practicing urologist and practicing DPM's and match up those names to see if there are any similar names. If there are perfect matches, let me know. And THEN I can assure you again it's not me!!!!

And the comment that I was a former residency director.....well that is true, but I'm not worried about that because I'm in good company there. I know of a lot that fit that category.

But if it makes you happy.....keep searching away. Just remember, I may not be quite as careless as you may believe. I'm much more calculated than you think.

However, once again, I assure you that my credentials, practice history and demographics are 100% accurate. I've only used harmless comments to throw people off my trail that have no effect on the accuracy of my comments or answers.

I sincerely apologize for this, but at the present time, my partners request that I remain anonymous and are less than thrilled that I am involved with this site.

Now to answer your question regarding Podfather's comments. Yes, there is legitmacy to his comments as always. Our practice is a large mix of patients, and since the practice has been around a long time, we do have our share of palliative care.

I actually treat the least amount of palliative care patients in the practice. For example, on Monday, I was out of the office for personal reasons until 9:30 am. So I worked from 9:30 am until 5:30 pm with an hour break for lunch. During that time I saw 10 new patients and I don't know how many other patients (probably around 40) and did not provide any palliative care.

One of my partners treated about 55 patients that day, and probably treated about 35 palliative care patients. I can tell you that I worked a LOT harder due to actually having to think, diagnose, treat and document, vs, chip, clip and short note on the computer.

It is easy to treat 55 or more palliative care patients, but it isn't as easy to treat 40 non palliative or complicated patients that require more time, knowledge and skill, not to mention more documentation.

Yes, Podfather makes an excellent point, but you have to work with what you have, and our practice has the full spectrum of patients at the present time. We do have a large geriatric population, and one of the reasons we chose to have evening and Saturday hours is to accommodate the younger professionals who require those hours, and it HAS helped significantly. I work about one Saturday a month and this past Saturday I didn't treat one geriatric patient, but did schedule two surgical procedures on younger patients and treated several sports injuries, made some orthoses, etc. It was a whole different demographic.

Now did I REALLY work Saturday....or am I just throwing you off track

 

[dtrack22]

PADPM,

I have yet to try and figure out who you are. I don't mean to be disrespectful but I don't really care. Much like you have too much to worry about at work, I have too much to worry about in school. I should have known you had a master plan to stay anonymous all along...

I appreciate the information about your practice. How long before your associates have the opportunity to buy in?

 

[347932]

...is similar to the way the band Lynard Skynard was named.

He just died. I shed a tear. I really did.

 

[UVAallday]

I'll tell you why they act this way towards grunt work.

In the age of twitter, myspace and online social sites these kids genuinely think they are the next lady gaga of podiatry. They see themselves as superstars and the next big thing in their field.

They are on the internet and google themselves so they must be important.... but they fail to realise .... they put themselves on the internet.... no one else did it for them out of reverence.

But they honestly think they are going to write books and articles and do research and cure the foot of it's ailments.... And the boss is holding them back by making them go to a nursing home and clip nails.

The fact is this is a generation of self important nobodies. They are legends in their own twitter mind and think they are the lady gaga of podiatry.

They are just average podiatrists 99.9% of the time, in fact, they are just average middle class xerox block nobodies living a boring life where they really havent done anything significant or noteworthy.... even the ones we think are big in podiatry are really... insignificant in the scheme of things... But hey, it doesn't matter that no one knows who the hell you are, it just matters that you can google yourself and put your own name into a wikipedia article on podiatry etc.

No one major or significant cares about our most famous pods... trust me on this one.

Life of a 99.9% of pods is average to below average. Just another number in society. They will pass without notice. doing pod stuff face it is not noteworthy for almost 100% of americans.

They are just kind of the same as a factory worker or an office worker.... just another face....in a sea of faces. but they can't accept that... even some of our old guys are in the lady gaga of podiatry land. But we can all pretend. Its our right as lady gaga fans.

What is wrong with this guy lol

 

[PADPM]

PADPM,

I have yet to try and figure out who you are. I don't mean to be disrespectful but I don't really care. Much like you have too much to worry about at work, I have too much to worry about in school. I should have known you had a master plan to stay anonymous all along...

I appreciate the information about your practice. How long before your associates have the opportunity to buy in?

No disrepect noted, I'm actually happy to hear you have not been wasting your time trying to figure out who I am, because I'm really not that important!!

There really is no master plan or set buy in agenda. Although this may seem like an evasive answer, it's really not. When the right person is in line and he/she has the right stuff, we will sit down and discuss it among the partners and then offer the doc some shares in the corporation. Initially, the shares are basically "given" to the doc with a buy in that is nominal, but just a formality to make it official (and I mean nomimal). Obtaining additioinal shares can take time and that's when formulas are derived to either limit future income as a buy in or simply purchase additional shares, etc. As doctors cut back or retire, additional shares also become available. It can become pretty complicated.

However, as per your original question, there really is no timetable. But I can guarantee you that when a superstar walks into our office, I will be the first to gather up the partners and try to convince them to offer this doc some shares to keep him/her onboard. I beleive we need some young blood and energy in the practice (though I don't believe any of us are lacking energy or a work ethic) and would love to bring aboard a young, hardworking superstar as a new partner. I have NO problem "sharing the wealth".......though I'm not sure I'd call it "wealth"!

 

[347932]

No disrepect noted, I'm actually happy to hear you have not been wasting your time trying to figure out who I am, because I'm really not that important!!

There really is no master plan or set buy in agenda. Although this may seem like an evasive answer, it's really not. When the right person is in line and he/she has the right stuff, we will sit down and discuss it among the partners and then offer the doc some shares in the corporation. Initially, the shares are basically "given" to the doc with a buy in that is nominal, but just a formality to make it official (and I mean nomimal). Obtaining additioinal shares can take time and that's when formulas are derived to either limit future income as a buy in or simply purchase additional shares, etc. As doctors cut back or retire, additional shares also become available. It can become pretty complicated.

However, as per your original question, there really is no timetable. But I can guarantee you that when a superstar walks into our office, I will be the first to gather up the partners and try to convince them to offer this doc some shares to keep him/her onboard. I beleive we need some young blood and energy in the practice (though I don't believe any of us are lacking energy or a work ethic) and would love to bring aboard a young, hardworking superstar as a new partner. I have NO problem "sharing the wealth".......though I'm not sure I'd call it "wealth"!

Just to expand on the cost of this somewhat. Guess what the minimum "buy in" figure is generally? Its $1.00. No, the decimal place is not in the wrong place. $1.00. No kidding.

Being a partner in a practice is much more than just making more money, folks. You have now taken on the fiscal responsibility of a business and are intimately involved in how the business runs and YOU are now the face of the business.

Everyone rushes to that question: "When can I be a partner????". That's a HUGE responsibility. In a practice like PADPM's, it means carrying on the tradition of excellence he and has partners have spent YEARS garnering. It also means taken on the responsibility of producing to make the business even more profitable. Its a burden. Believe me. The business now counts on YOU to make sure ends meet and your staff get paid. No more "Meh not feeling great, call in sick, I don't mind losing a days pay because I make enough". That is NOT an option when you're an owner. If you don't show up, those patients that just got that rescheduling call go elsewhere, which affects the bottom line. No associate I've ever met really thinks about that.

A practice looking for an associate/partner is much more than just, lets hire someone and see how it goes. They are looking for "that guy/gal" to carry on their name and good will. Its a big decision to do this and its not made lightly.

 

[All4MyDaughter]

This is not the starting salary and represents the median. Median = average. There are some on the higher end of the bell curve and others on the low end. I would like to see 1st year/2nd year associates' numbers, not nationwide salaries over the spectrum of the career of the Ortho Surgeon.

Also, don't forget that these median numbers are generally several years old and don't take into account the ever changing insurance fees (generally for the lower) and also don't take into account the starting cost for hiring a new doctor into the practice.

Again, its a median, which can rarely be used to calculate what a new doctor should be paid.

Look at the median salary for a Podiatrist, published by the APMA and see how many 1st year/2nd associates, fresh out of residency actually make that. I'm not asking for the exception to the rule, I'm asking for the median salary for a newbie, green out of residency. The average salary.

Actually, the median =/= the average. The median is simply the middle number in a distribution (sorted by numerical order), or the average of the two middle numbers if the distribution has an even number of figures. The median is less vulnerable to outliers than the mean, so one enormous (or tiny) figure won't skew the median the way it can the mean.

The mean is the average. It's calculated by taking [N1 + N2 + N3...] and dividing by the total number of values in the set.

In some distributions, the mean = the median. But not always. There is a difference and the two terms are not interchangeable.

 

[347932]

Actually, the median =/= the average. The median is simply the middle number in a distribution (sorted by numerical order), or the average of the two middle numbers if the distribution has an even number of figures. The median is less vulnerable to outliers than the mean, so one enormous (or tiny) figure won't skew the median the way it can the mean.

The mean is the average. It's calculated by taking [N1 + N2 + N3...] and dividing by the total number of values in the set.

In some distributions, the mean = the median. But not always. There is a difference and the two terms are not interchangeable.

LOL thank you for correcting me, but this was for the sake of simplicity. If you want to get into a discussion of what mathematics actually means in the real world vs. that of the statasticians, I'd be glad to have that discussion in another forum. Also, yes the median is not the same as a mean, but for the sake of the bell curve, it is largely similar enough to add to the discussion.

Lastly, what exactly is your point or how did you add to this discussion by pointing this out? I concede that I perhaps over simplified the equation, but does your example change the gist of the post?

 

[All4MyDaughter]

LOL thank you for correcting me, but this was for the sake of simplicity. If you want to get into a discussion of what mathematics actually means in the real world vs. that of the statasticians, I'd be glad to have that discussion in another forum. Also, yes the median is not the same as a mean, but for the sake of the bell curve, it is largely similar enough to add to the discussion.

Lastly, what exactly is your point or how did you add to this discussion by pointing this out? I concede that I perhaps over simplified the equation, but does your example change the gist of the post?

Well for one thing, the median salary for orthopods may provide a more accurate picture than you portray, because the AVERAGE (mean) salary is going to be skewed by those who have been in practice for a long time and earn very high salaries but the median salary will be less skewed. The median salary is closer to the middle of the pack for all individuals in the distribution and may HELP shed some light on the issue of what new orthopods might expect to earn. A salary survey of practitioners stratified by # of years in practice would be really helpful, but perhaps that data doesn't exist?

RE: "real world vs. statistics." Mean and median aren't interchangeable in either arena. It's basic middle school math.

 

[347932]

Well for one thing, the median salary for orthopods may provide a more accurate picture than you portray, because the AVERAGE (mean) salary is going to be skewed by those who have been in practice for a long time and earn very high salaries but the median salary will be less skewed. The median salary is closer to the middle of the pack for all individuals in the distribution and may HELP shed some light on the issue of what new orthopods might expect to earn. A salary survey of practitioners stratified by # of years in practice would be really helpful, but perhaps that data doesn't exist?

RE: "real world vs. statistics." Mean and median aren't interchangeable in either arena. It's basic middle school math.

You know what? You're absolutely right. And? Since we are not Orthopods and in my area I know what a new gen ortho makes, why argue?

 

[All4MyDaughter]

You know what? You're absolutely right. And? Since we are not Orthopods and in my area I know what a new gen ortho makes, why argue?

I think your figure of $150,000 to start is reasonably accurate. Google gave me a median starting salary for orthopedic surgeons of $185,000 so if one accounts for regional variations, 150K is not out of the question.

 

[air bud]

Well for one thing, the median salary for orthopods may provide a more accurate picture than you portray, because the AVERAGE (mean) salary is going to be skewed by those who have been in practice for a long time and earn very high salaries but the median salary will be less skewed. The median salary is closer to the middle of the pack for all individuals in the distribution and may HELP shed some light on the issue of what new orthopods might expect to earn. A salary survey of practitioners stratified by # of years in practice would be really helpful, but perhaps that data doesn't exist?

RE: "real world vs. statistics." Mean and median aren't interchangeable in either arena. It's basic middle school math.

I disagree with you. I have a family member who is a practicing MD (surgical specialist). He is retiring and they just hired his replacement fresh out of residency. He will be STARTING at what this family member finished at.

 

[All4MyDaughter]

I disagree with you. I have a family member who is a practicing MD (surgical specialist). He is retiring and they just hired his replacement fresh out of residency. He will be STARTING at what this family member finished at.

Disagree with what? I think what you've described is pretty uncommon for physicians but it's great that your family member will be so well compensated starting out. But that anecdote doesn't disprove my theory that the median starting salary might be useful in estimating the expected starting salary for an orthopedic surgeon.

 

[dtrack22]

What if air bud's anecdote is more common than you think? You admittedly don't know either way, so your theory is pretty meaningless.

If air bud's story is in fact the norm, then your commentary on Docs who have been in practice for a long time "skewing" the mean (upwards) is false. If that is the case then mean and median really are more similar than they are different.

If you were an ortho attending, or resident, or even an allopathic student then I could see the reason for your original post...but since you are a pharm student and a mod, I'm really confused as to why you felt the need to comment on kidsfeet's post.

 

[Feli]

...I must rant on partnerships. In my job with the podiatry practice partnership buy-in was going to be over $300K (in a small podiatry practice). In my job with the ortho practice my buy-in as a full/equal partner was less than that and this is in a large ortho practice that collects over $13 million a year. To me partnership is for job security, commitment to the practice and ability to have input/call the shots but not really to make more money. I don't understand why many podiatry practices I have seen make the partnership buy-in so expensive. It's set up so that the practice has to make money on you for a number of years before you may be offered partnership. I'd like to hear from others what their partnership buy-in situations are/were, what it's based on and how they feel about it.

I think it's pretty simple to estimate the worth of a practice, and there's really no reason you can't base partnership off of that.

Practices are basically worth their net income (either previous year or avg of last 3yrs). I've also heard ~50% of annual gross income used to determine value, but net income seems more logical. Then you add tangible assets (office real estate, equipment, instruments, etc). Therefore, partnership is basically just owning a piece of the practice, so why shouldn't it be based on the practice worth?

ie, equal [productivity-based] partnership into a 3 doctor practice netting $800k and having $200k worth of equipment should be $1000k worth/4partners = $250k. With that, you've paid 25% of the value for the soon-to-be 4 doc practice and should then be able to take home what your services collect (and obviously also pay a quarter of the overhead). Likewise, equal partnership with a solo doc who has a $150k/yr net practice and $50k tangible office assets should be $200k worth/2 partners = $100k buy-in, etc.

The tougher arrangements to figure out are where practice income is split not based on each partner's productivity but instead on equal terms (total net income divided by # of partners... all get same amount), ownership % (net income divided to each partner based on %), or some hybrid of equal/productivity/ownership.

There are always intangible things like goodwill, practice's reputation, referral types, staff quality, etc which may make a practice worth more or less in the eyes of the buyer or seller. That's probably where things get murky, but you can always hire an independent appraisal... it's a big purchase and worth doing your homework.

 

[All4MyDaughter]

What if air bud's anecdote is more common than you think? You admittedly don't know either way, so your theory is pretty meaningless.

If air bud's story is in fact the norm, then your commentary on Docs who have been in practice for a long time "skewing" the mean (upwards) is false. If that is the case then mean and median really are more similar than they are different.

If this, if that. You're right that we really don't know. And the plural of anecdote is not fact so more anecdotes wouldn't clarify the issue much. All any of us can do is speculate. But again, I think kidsfeet's numbers sound pretty reasonable.

If you were an ortho attending, or resident, or even an allopathic student then I could see the reason for your original post...but since you are a pharm student and a mod, I'm really confused as to why you felt the need to comment on kidsfeet's post.

LOL. I'm interested in the topic and I'm a math nerd. Besides, anyone is free to participate in any discussion on SDN (outside of the private areas of course). But since you asked, I've been involved with the SDN podiatry forums for a long time. Longer than you've been a member of SDN.

I am the person who worked with the APMA to get them to co-host the forum. At their suggestion, I changed the name of the forum to "Podiatric Residents and Physicians." I worked with Dr. Rogers to put the first podiatry-centered article on the front page of SDN and I obtained three more from the APMA: Link

Maybe it's time to do another podiatrist profile for SDN's front page. Do you have any suggestions for someone who'd like to be featured? If you have a professor or other contact who you think would be appropriate, let me know. We are always looking for submissions for our front page and we do pay a small stipend to our writers.

I turned over the coordination of organization partnerships and haven't written any articles since my daughter was killed in 2008, but I continue to read this forum every single day. I'm not a "pharmacy mod." I'm an administrator for the entire site and advocating for our smaller communities has always been very important to me.

I've been very proud of how the podiatry forums have grown at SDN. They now make up our fifth largest community after MD/DO, DMD/DDS, PharmD and OD. I'd say DPM is challenging OD in terms of traffic and total number of posts, which is particularly significant because the DPM forums are much newer and there are relatively few DPM schools.

So, you can try to make me feel like an outsider if you'd like and you are always free to ignore my posts, but I'll continue to be here, advocating for your community on the SDN Board of Directors and looking for ways to enhance SDN for all members, regardless of what letters they have (or will have) after their names.

 

[dtrack22]

LOL. I'm interested in the topic and I'm a math nerd. Besides, anyone is free to participate in any discussion on SDN (outside of the private areas of course). But since you asked, I've been involved with the SDN podiatry forums for a long time. Longer than you've been a member of SDN.

I am the person who worked with the APMA to get them to co-host the forum. At their suggestion, I changed the name of the forum to "Podiatric Residents and Physicians." I worked with Dr. Rogers to put the first podiatry-centered article on the front page of SDN and I obtained three more from the APMA: Link

Maybe it's time to do another podiatrist profile for SDN's front page. Do you have any suggestions for someone who'd like to be featured? If you have a professor or other contact who you think would be appropriate, let me know. We are always looking for submissions for our front page and we do pay a small stipend to our writers.

I turned over the coordination of organization partnerships and haven't written any articles since my daughter was killed in 2008, but I continue to read this forum every single day. I'm not a "pharmacy mod." I'm an administrator for the entire site and advocating for our smaller communities has always been very important to me.

I've been very proud of how the podiatry forums have grown at SDN. They now make up our fifth largest community after MD/DO, DMD/DDS, PharmD and OD. I'd say DPM is challenging OD in terms of traffic and total number of posts, which is particularly significant because the DPM forums are much newer and there are relatively few DPM schools.

So, you can try to make me feel like an outsider if you'd like and you are always free to ignore my posts, but I'll continue to be here, advocating for your community on the SDN Board of Directors and looking for ways to enhance SDN for all members, regardless of what letters they have (or will have) after their names.

You could have saved an entire Ethiopian village, wouldn't change the fact that your post was pointless. And nobody said you were a "pharmacy mod"...but I'm glad you shared how important you are. I'll be sure to send you some names. Can't wait to see them on the front page!

 

[All4MyDaughter]

You could have saved an entire Ethiopian village, wouldn't change the fact that your post was pointless. And nobody said you were a "pharmacy mod"...but I'm glad you shared how important you are. I'll be sure to send you some names. Can't wait to see them on the front page!

Good, I hope you will. It's an easy way for you to advance your profession and enhance the SDN community. Please make sure you ask them if they are interested first, before passing along contact information. Wouldn't want to waste anyone's time. I'll be watching for your message.

 

[air bud]

If this, if that. You're right that we really don't know. And the plural of anecdote is not fact so more anecdotes wouldn't clarify the issue much. All any of us can do is speculate. But again, I think kidsfeet's numbers sound pretty reasonable.



LOL. I'm interested in the topic and I'm a math nerd. Besides, anyone is free to participate in any discussion on SDN (outside of the private areas of course). But since you asked, I've been involved with the SDN podiatry forums for a long time. Longer than you've been a member of SDN.

I am the person who worked with the APMA to get them to co-host the forum. At their suggestion, I changed the name of the forum to "Podiatric Residents and Physicians." I worked with Dr. Rogers to put the first podiatry-centered article on the front page of SDN and I obtained three more from the APMA: Link

Maybe it's time to do another podiatrist profile for SDN's front page. Do you have any suggestions for someone who'd like to be featured? If you have a professor or other contact who you think would be appropriate, let me know. We are always looking for submissions for our front page and we do pay a small stipend to our writers.

I turned over the coordination of organization partnerships and haven't written any articles since my daughter was killed in 2008, but I continue to read this forum every single day. I'm not a "pharmacy mod." I'm an administrator for the entire site and advocating for our smaller communities has always been very important to me.

I've been very proud of how the podiatry forums have grown at SDN. They now make up our fifth largest community after MD/DO, DMD/DDS, PharmD and OD. I'd say DPM is challenging OD in terms of traffic and total number of posts, which is particularly significant because the DPM forums are much newer and there are relatively few DPM schools.

So, you can try to make me feel like an outsider if you'd like and you are always free to ignore my posts, but I'll continue to be here, advocating for your community on the SDN Board of Directors and looking for ways to enhance SDN for all members, regardless of what letters they have (or will have) after their names.

thank you for your contributions to the forum/profession.

 

[347932]

I think it's pretty simple to estimate the worth of a practice, and there's really no reason you can't base partnership off of that.

Practices are basically worth their net income (either previous year or avg of last 3yrs). I've also heard ~50% of annual gross income used to determine value, but net income seems more logical. Then you add tangible assets (office real estate, equipment, instruments, etc). Therefore, partnership is basically just owning a piece of the practice, so why shouldn't it be based on the practice worth?

ie, equal [productivity-based] partnership into a 3 doctor practice netting $800k and having $200k worth of equipment should be $1000k worth/4partners = $250k. With that, you've paid 25% of the value for the soon-to-be 4 doc practice and should then be able to take home what your services collect (and obviously also pay a quarter of the overhead). Likewise, equal partnership with a solo doc who has a $150k/yr net practice and $50k tangible office assets should be $200k worth/2 partners = $100k buy-in, etc.

The tougher arrangements to figure out are where practice income is split not based on each partner's productivity but instead on equal terms (total net income divided by # of partners... all get same amount), ownership % (net income divided to each partner based on %), or some hybrid of equal/productivity/ownership.

There are always intangible things like goodwill, practice's reputation, referral types, staff quality, etc which may make a practice worth more or less in the eyes of the buyer or seller. That's probably where things get murky, but you can always hire an independent appraisal... it's a big purchase and worth doing your homework.

Your estimation of how it SHOULD work is accurate.

Unfortunately, trying to sell a piece of your business (read a piece of you) is much like trying to sell your 1st car. You love the car to death. You spent many evenings (ahem) in that car and it took you out on many dates. It was the car you went out in on your 21st birthday and brought someone to drive you home and spent the next day cleaning your puke out of. AHHHH the memories. When its time to trade it in, someone tells you its only WORTH 1/5 of what you are asking for the trade and you leave the dealership furious that someone would have the cajones to offer you so little for your baby.

Many times its very difficult to put a value on your hard earned success. To a new practitioner who didn't have to do what you did, its even harder. So owners inflate the worth and expect the moon. You are, ultimately buying into THEIR work.

This is why the scenario is anything but simple. It never is.

Another issue which I've mentioned before, is some of these docs see you, a potential partner, as their big ticket to retirement. They didn't plan the way they should have and are now expecting to receive hundreds of thousands of dollars for something that, if evaluated like you recommend, isn't worth nearly that.

The other thing to take into consideration is that excellence in service, backed by a good name is priceless. Since you will be an extension of this, I agree that the number shouldn't be outrageous, but you know, you should be at least sensitive to it imho.

I read an article a long time ago that a buy in shouldn't be more than 50% of what it would cost you to hang your own shingle. To extrapolate a little, this means that any buy in should be less than about $125 000. Is that just? I really don't know at this point. In a few years, when my partner and I start considering potentially bringing in another, I'll let you know.

 

[All4MyDaughter]

Kidsfeet makes some excellent points about the issue of what is reasonable to pay in order to buy into a business vs. what the seller wants/needs/expects to get for it. The car analogy is spot on. I still remember when we were expecting our first child and needed to sell my husband's beloved Thunderbird. What we THOUGHT it was worth and what we eventually got for it were very different.

I recently looked at a pharmacy that is for sale. It represents the owner's lifes work and it's been in his family for 60 years. But he needs to sell it for a premium to finance his retirement. And that's unfortunate because it's a bit outdated and RX volume is dropping (thanks, Wal-Mart). So I don't know what will end up happening, but I'm not going to be the buyer.

 

[PADPM]

In my experience when I was a few years younger, when faced with offers of buying into practices, or more often when looking into purchasing existing practices, it often had NOTHING to do with reality.

I found that doctor's were often unreasonable with expectations of the worth of the practice and didn't believe in the standard accountant formulas because these doctors were more often than not "legends in their own minds".

That's why I started my own practice. However, in today's economy that's not always possible, including the fact that many grads have incredible debt. And formulas have changed since in the "old" days practices were GENERALLY worth about what they netted the year prior or half of gross, etc. However, today it's much different. MUCH different.

That is due to managed care and other issues. You can purchase a practice or buy into a practice that may be heavily involved with managed care. If X amount of dollars are based on managed care contracts, ALL those dollars can be lost literally in one day if a doctor or group of doctors decides to pull the contract, etc.

That's vs. the old days when there was always an expected attrition rate. That rate is no longer valid, since with managed care you can literally lose an entire population of patients with the stroke of a pen overnight.