Financial pressures and uncertainty about the future of the American healthcare industry are changing the way independent physicians and other medical professionals run their practices, according to a survey by TD Bank. These concerns impact everything from the way a practice is established to technology investments and retirement outlook.
Based on the survey of more than 320 small medical practices in the U.S., 39 percent of physicians purchased a partnership in an established practice or an existing practice, while 37 percent started it from scratch.
Another change is that more women are becoming practice owners. While the respondents have been in practice for an average of 16 years, 36 percent of women reported owning their practices for less than five years, while 47 percent of men have been in practice for more than 20 years.
When assessing the future, 50 percent of doctors surveyed either have considered or would consider purchasing, buying into, merging or selling their practice. Among these medical professionals, 73 percent expected to do so within the next four years. When asked why they would make such a change, forty-six percent of respondents explained that it's simply too expensive to run a practice today.
In general, medical practices are growing, with 43 percent of respondents expecting to increase revenue over the next two years. Of those surveyed, women and Millennials are most optimistic about expected revenue growth. The most popular methods for financing the needs of a practice -- including new equipment, computers, practice management software, practice acquisitions and practice buy-ins -- included lines of credit and cash. Among those surveyed, 41 percent chose lines of credit and 36 percent preferred cash. While Millennials were most likely to prefer using a line of credit, Baby Boomers would use cash to finance their needs and Gen Xers are more likely to reach for credit cards.
When asked about investing in the next few years, 48 percent of medical practitioners said they would prioritize buying or leasing of new technology; 33 percent said they'd hire more staff; and 26 percent said they'd invest in training and education.
As with most U.S. workers, finances are dictating retirement decisions for doctors as well. For medical professionals under age 35, 84 percent of those who were surveyed think they will retire by age 65, while 76 percent of doctors currently 55 years old or older believe they will have to retire after age 65. More specifically, 30 percent of physicians across all age groups report they will have to postpone their retirement to later than originally planned.