By Michael Nissenbaum, CEO of Aprima Medical Software, and Dr. Chadwick Prodromos, Orthopaedic Sportsmedicine Specialist

August 2016 – Independent physicians are not quite a dying breed, though their ranks are dwindling. In the year 2000, 57% of all doctors worked in their own private practice; today, only about one-third of physicians remain independent. The doctors who are trading independence in favor of health system employment are often hoping to eliminate the administrative hassles of running a private practice. Others believe employment can lead to better financial stability or the opportunity for a more balanced work/personal life.

Despite this trend, plenty of physicians remain committed to their independence and find it financially and professionally rewarding. Most independent doctors believe they are able to deliver superior patient care and a more satisfactory patient experience.

We believe that both hospital employed physician and independent physician models can result in happy physicians and the delivery of excellent health care. We believe that hospital owned practices are universally well intentioned and that many do an excellent job of achieving their goals. However, we also believe that it is inherently more difficult to run a large centrally owned practice than an independent practice, and we have seen many instances where the results have not risen to the level of these excellent intentions. While we have great respect for these hospital employed physicians and their administrative leaderships, we remain committed to an independent practice model. Therefore, the following will discuss the potential advantages of independent practices as we see them, and explain why this practice model remains quite viable.

Doctors are free to refer to other doctors based on merit

Employed doctors are encouraged and often required to refer only to other doctors in their network. This is contrary to the public good and has the potential of removing the doctor from the role of “trusted advisor” to a more pedestrian role that is focused on generating hospital revenue. It’s well-documented that the cost of care is higher in health system settings, yet there is little evidence that outcomes are superior for patients that receive care from health system doctors. Independent physicians have the autonomy to base referrals strictly on medical factors and to exclude non-medical criteria.

Patient service is better

From both a care and economics perspective, independent physicians and their office teams tend to have aligned interests. Both are incentivized to keep their patients happy and provide superior levels of care so that patients choose to return, referrals continue to flow, and the practice remains prosperous. Should an independent doctor get feedback from patients that a staff member is providing bad service, the doctor can request changes in behavior, or, simply make changes in staff. Within a health system, staffing is often fluid and turnover is high, so patients may not receive the same level of service. At the same time, employed doctors have less power to take the actions required to affect change.

Staffing levels are optimized

Independent doctors have the ability to manage staffing levels to ensure the best possible delivery of care and a properly balanced workload. Often when an independent practice is acquired by a health system, long-term staff, including mid-level providers and nurses, are cut in an effort to save money. Not only does this impact patient care, it also decreases physician productivity and, in turn, physician compensation. The doctor may be forced to take home work – especially to complete EMR coding for billing – because paperwork can’t be completed during the normal work day.

Technology is designed for practices, not hospitals

Independent physicians have the ability to adopt technologies that are well-suited to their practice needs, specialty, and work style. Doctors who transition from independent practices to health systems usually must give up their preferred technologies in favor of the employer’s standard platforms. For example, rather than an appointment scheduling system designed for in-office staff, many health systems use centralized scheduling systems that give individual physicians (and their staff) less flexibility and control. Similarly, doctors must forgo their preferred EMRs and adopt the health system’s EMR, which is often more complex and less doctor-friendly. Most physicians will admit that the complexity of enterprise EMRs leads to a loss in productivity. Physicians may be unable to complete patient notes at the time of the encounter and must either complete their charting after hours or make a reduction in their patient workload – which negatively impacts their compensation.

Facilitated communication

Communication channels are typically faster and easier to navigate for independent practices, which are usually much smaller than hospital-owned practices. Having a receptionist in the same office as the doctor (which is the typical set-up with independent physicians) facilitates communication between doctors, staff and patients. Connecting with the right person is much easier when no one’s phone call has to be funneled through the health system’s dreaded phone bank (“please hold, your call is very important to us”). Better communication enhances patient care and satisfaction, and even reduces medical liability risk.

Fear often drives independent physicians to consider health system employment. Some may fear a loss of referrals when their peers join a health system. However, patients no longer rely solely on their primary care physician for referrals. The proliferation of online physician rating sites and the use of social media have helped shift referral patterns, and quality doctors will continue to thrive, regardless of their employment status.
Independent doctors also fear for the financial viability of their practices in the face of declining reimbursements and rising costs. However, new business models, such as accountable care organizations and patient-centered medical homes have the potential to boost practice revenues, while numerous information technology advancements provide opportunities to streamline costs and improve efficiencies.

Though more doctors today are choosing to be employed by health systems, independent practices offer numerous benefits for patients and physicians alike. Despite economic uncertainties, practicing as an independent doctor remains a possible and rewarding alternative.

About the Authors

Dr. Prodromos is an Orthopaedic Sportsmedicine Specialist and editor of the comprehensive textbook for Orthopaedic Surgeons on the Anterior Cruciate Ligament. He is a graduate of Johns Hopkins Medical School and trained in Orthopaedics at Rush and Harvard/MGH. He is Assistant Professor of Orthopaedic Surgery at Rush Medical College. He is also active in PRP and stem cell research.

Michael Nissenbaum is president and CEO of Aprima Medical Software, a company that provides innovative electronic health record, practice management and revenue cycle management solutions for medical practices. Prior to joining Aprima in 2004, Nissenbaum enjoyed a highly successful career at Millbrook Corporation and GE Healthcare. Nissenbaum earned an MBA from the University of Chicago and is a Certified Public Accountant and Chartered Financial Analyst®.