In a post I wrote a few months ago for DrGOpines.com, I stated three major reasons why physicians were leaving private practice. Those three reasons are actually major challenges doctors face that are rapidly ending the existence of the private practice, independent physician. Those three reasons were:
1. Ridiculously low payment for services rendered, ie. Insufficient revenues.
2. Dramatic increase in practice costs, ie. Overhead expenses consumed most of revenues
3. Ridiculously complex and burdensome procedures and regulations imposed by payers
These were the same reasons why after 33 years of private practice I decided to throw in the towel and become an employee of a large, multi-specialty group practice. It was an easy decision for me because making a living had become very difficult.
Despite my inability to sustain a viable business, private practices still exist and many thrive. I think success or failure depends upon the number of physicians in the practice (more is better), the practice leadership/management, and the type of services they provide (having major procedures you perform adds significant revenues). Being a solo practitioner and doing geriatric and preventive medicine is not a recipe for financial windfall.
In 2024, a survey determined that 42.2% of physicians were still private practitioners. Fifty-four percent were employees of some entity, while the other 3.8% fit into some un-named category. Those still in private practice were largely happy about it telling Medscape surveyors it was “gratifying and rewarding.” The article containing that data also shared answers private practitioners gave about what was good and what was bad about private practice. Their answers are not surprising to me but may be to you.
What I would like to emphasize to you, the reader, is that private practice is a business which for over 35 years has not received any incentive to help sustain itself nor any support from the federal government (Medicare) or private insurers to continue providing the service of quality health care to American citizens! The truth is the exact opposite—policies designed to frustrate and anger physicians and increase the complexity of providing care are continually thrust upon physicians causing confusion, disillusion, and discouragement. But still physicians hang on.
What follows next are lists of, first, the good things about private practice, and second the bad things about private practice.
What Doctors Say are the GOOD Things About Private Practice
AUTONOMY: the freedom to be your own boss and run your practice as you want. You set your hours, work schedule, and make all practice-related decisions.
CONTROL OVER PRODUCTIVITY: the doctor decides how many patients he sees per hour/per day.
THE POTENTIAL TO GROW INCOME: not being bound to any performance quotas the doctor works as much as he desires.
NO MANDATORY PERFORMANCE TARGETS: There is no RVU total the doctor needs to meet to justify his salary.
JOB SECURITY: It’s the doctor’s business. It lives (or dies) by the efforts he puts forth to make it a success.
What Doctors Say are the BAD Things About Private Practice
MY INCOME IS NOT GUARANTEED: My income is based solely on my efforts.
I’M RUNNING A BUSINESS: It’s a full time job to see patients plus manage all the aspects of the practice.
MANAGING THE STAFF: Hiring, performance reviews, office meetings, firing are all the doctor’s responsibility.
DEALING WITH GOVERNMENT REGULATIONS: Privacy rules, HIPAA, Prior Authorizations are ultimately the doctor’s responsibility.
HUGE TIME COMMITMENT: Private practice requires maximum time from the physician.
MARKETING, ADVERTISING: If done, these are an expense of money and time.
In summary, the doctor owns a practice (business) he runs the way he wants to and works as much, or little, as he desires and to cover the overhead. However, the doctor bears ultimate responsibility for all business activities and decisions as well as caring for the patients who frequent his business. It is a major commitment of time and money and must be profitable to remain viable.
The financial viability of private practices has become very tenuous over the past 20-25 years for reasons I have stated many times in the past. This post addresses the many things that motivate physicians to keep private practices alive. It requires hard work, time, a steadfast commitment, and astute business sense. As I mentioned earlier, private insurers and Medicare and Medicaid have literally no interest in helping your practice to stay in business. Most of the time doctors feel like they’re actively working against us and making it more difficult to make a living. Still many entrepreneurial types are able to make a go of it, eg. The Concierge Practice Model. The medical profession business model is changing in many ways. We don’t know what model will be the standard in future years. What I do know is that whatever it is, physicians will be subservient to another controlling entity.
Reference: McKenna J. The Antidote to Corporatization of Medicine: Medscape Self-Employed Physician Report 2025. Medscape 2025 November 11.
