The practice of medicine is generally considered one of society's most-valued services, and in the United States respect for individualism and independence historically boosted the profession's reputation as a solid career. There are no worries about the occupation's prospects for job growth — the U.S. Bureau of Labor Statistics projects employment of physicians and surgeons to grow 18 percent from 2012 to 2022, faster than average for all other occupations.
Still, that growing demand rests uneasily on a shifting base of healthcare reimbursement changes. Getting through medical training requires a high amount of self-determination, so it makes sense that many enter the field envisioning long-term solo practice or small partnerships. But waves of organizational change threaten to clear away those still clinging to independent private practice. It might not be an understatement to say that in this new era, practices working collaboratively may not just be only the best strategy to thrive, but the only way to survive.
"Collaborating is crucial," says practice management consultant Carol Stryker. "… Practices must join forces in a formal way to bring quality of care up, drive costs down, and expand value."
Said succinctly: Size matters, especially when it comes to economies of scale.
"The bigger a physician group is, the more bargaining power they have with payers," says attorney Michael Kreager a business and healthcare law specialist. "[Plus], you'll get more for your money when you buy 100 boxes of gloves instead of only 20."
And with size comes structural changes, so with more moving pieces comes more oversight for practices.
"…Applicable labor laws change when your group of employees increases," notes Stryker. "We're all looking forward while trying to keep our footing in the present day-to-day. The need for physicians to have people on board who are charged with paying attention to every detail, keeping an eye on [human resources] and HIPAA and training, so that you're doing things right and legally — that's here and now."
But don't think that all the added layers necessary for collaboration are too difficult and that your next best option is being acquired by the local hospital.
"Selling out to a hospital means they get to direct how [their] practice operates," Stryker says. "Simply put, physicians can end up trying to keep bean counters happy."
Instead of seeing their hard-earned private practices absorbed into hospital systems, a growing number of physicians are utilizing a pair of options to bulk up and add value: independent physician associations (IPAs) and super groups.