Practice Transition Strategies: Planning ahead for inevitable change
According to the 2021 Jackson Physician Search survey, 21% of physicians are considering early retirement. This trend is expected to exacerbate the physician shortage, which is an increasingly troubling issue for the industry. But what does it mean for individual organizations?
How a practice weathers the retirement of one or more of its physicians depends entirely on how much thought has been put into its transition strategy. A transition of ownership can be a destabilizing event, or it can set the organization and its physicians up for success.
Planning ahead can be a difficult task in any industry, but the constant and rapid change in healthcare makes it especially complex for physician practices. To account for healthcare’s complexities, it’s important for physicians to keep their transition strategy as flexible as possible. They should plan early and with purpose, but be ready to navigate change and the shifting needs of their organization.
It’s also important for them to keep in mind that the exact date of a physician’s retirement can’t be predicted. Market forces, income needs, personal health, and the health of loved ones can all impact the decision to retire. Luckily, they can still lay out a plan that allows for uncertainty.
Tools at physicians’ disposal
A recent Physicians Practice article outlines an effective approach to transition planning, breaking the process down into the following steps:
- Establishing a timeline
- Identifying a successor
- Empowering the successor
- Considering practice financials
Hospitals and health systems can provide support
Hospitals and health systems can support their physicians as they begin to think about their practice’s transition strategy. Supporting independent physicians is one way hospitals can ensure that they’ll be able to keep a practice’s patients and remaining physicians after a transition of ownership has taken place.
A hospital can educate physicians, making them aware of their options regarding succession planning. They can also provide access to a team of specialists, such as financial planners and healthcare compensation experts, who can help them establish a cost-efficient approach. Hospitals and health systems might even be willing to play a role in physician recruitment in order to make sure that a practice remains strong for years to come.
MaxWorth can help
We’d like to be an additional resource for practices as they plan for the future. MaxWorth specializes in the evaluation and implementation of compensation and benefit programs for the healthcare industry. Our Practice Transition Strategies is a program that offers an alternative to traditional succession funding methods. We believe our approach is more flexible and secure for all parties involved.
If you’d like to learn more about our Practice Transition Strategies, schedule a call with us today.
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