The Employed Physician: Why the 'Hospital Leap' isn't for Everyone

Looking at the medical practice landscape, 2013 may seem like the ideal time for private practitioners to make the leap to hospital status. Of course, that's not to say they should, just that it's becoming a prescient reality for many on the inside, per some troubling reports.

In a report, penned and conducted by the medical headhunting company Merritt Hawkins, findings indicate that in terms of recruitment, the independent or private practice model is becoming somewhat of an anomaly, with a Medscape article (Physician Headhunters Now Work Mostly for Hospitals) even calling the model "an anachronism" (Lowes).

Recruiting Trends

The Merritt Hawkins report examines physician recruitment search assignments handled by their own company, along with the searches of two sister physician staffing companies, Staff Care and Kendall Davis.
Looking at the window of time from April 1, 2012 to March 31 2013, a whopping 64% of physician search assignments came back from hospitals looking specifically to hire private practice physicians. For context, compare this figure to the same search conducted eight years ago, which saw only 11% of physician searches coming from hospitals looking to hire. "Back then, most search assignments came from group practices, physician partnerships and solo practitioners," says Travis Singleton, Senior Vice President at Merritt Hawkins.

It's not just private practice that hospitals are after, but general MD's and DO's as well...and for that matter, it's not only hospitals which are looking to hire private practice physicians. Merritt Hawkins reports that they're doing increasingly more searches on behalf of retail clinics, urgent care centers, freestanding emergency departments and community health centers.

While Singleton says the report indicates the "demise of private practice," these numbers have an even greater personal meaning to many physicians. Looking at the same 12 month window of time analyzed by the report (April 1, 2012 to March 31, 2013) 85-90% of all physician search assignments involve some form of physician employment.This, compared with the 30% of these types of searches conducted in 2004 suggest a potent change in the landscape.

Healthcare's Sea Change

It shouldn't come as much of a surprise that primary care still tops the list of the most recruited medical fields (with first place going to family physicians and second to general internists). This is the seventh year in a row now, and a shortage of these clinicians has been a contributing factor for their high demand for some time. Demand is also building for nurse practitioners and physician assistants, and the two professions made their way into Merritt Hawkins list of The 20 Most Recruited Specialties for the first time in the 2012-2013 window. They ranked high on that list too, 10th and 12th respectively. Though these positions have historically been regarded as "supplemental" to physicians, and not outright replacements, the shift of medical employers to the more corporate side of the coin (for example, Walgreens operated retail clinics) sees these positions continually answering to more corporate bosses and less to independent physicians.

Other major changes seen by the Merritt Hawkins study include the rise of geriatrician employment, a change most likely due to the increasing senior population and the number of healthcare organizations struggling to account and care for it.

Why 'Employment' Appeals to Some

This shift to "employee status" hasn't been easy for all private practice physicians. It comes with an increased level of difficulty for those who've been in the field for a long time. In some regard, it requires a shift in working mentality, from that of a more "entrepreneurial" spirit to that of a "worker."

This generation's medical school graduates aren't unfamiliar with the prospect of hospital, or other physician employment. It's become a more likely possibility for them than those of previous generations. In some regards, the prospect of being an "employed" doctor is attractive to new graduates. "They want to come in at 9 and leave at 3," says Singleton, indicating that it's a certain occupational quality that these new physicians are after, one which doesn't require them to be on call and comes replete with certain perks like set vacation hours.

Employment Woes = Hope for the Independent Practitioner

Though physicians in private practice may feel as if they're working against an irreversible tide, what with private practice being treated as an endangered species, the jump to "employment" isn't necessarily a panacea to their ailment.

Private practice physicians should take a long, hard look at the employment model before signing up for anything, because for all the bells, whistles and securities that hospitals and urgent care centers can offer, they come with their own set of difficulties as well.

Autonomy Lost

It's likely that the most biting difference between working in private practice versus a hospital is the loss of autonomy for physicians. Financial promises held by hospitals may be attractive for struggling private practice physicians, but really may not be enough to present a worthwhile work environment. Some aspects to take into account, according to David R. Dearden, JD, an attorney with Kalogredis, Sansweet, Dearden and Burke Ltd., in Wayne, Pennsylvania who represents many physicians contemplating selling their practices to hospitals, include the location where a physician will work once they leave private practice, whether the provided support staff will have the skills and interests necessary and whether the physician will be able to discipline them--or if that level of control stays with the employing hospital. Private practice physicians newly entering hospital employment must also learn to divvy up their time, and whether or not they'll be able to do it as they wish, like attending AAFP board meetings or any other pursuits.

Ultimately, it's important that these physicians come to grips with the fact that they really won't always be "their own boss." They must also learn to navigate within a larger institution, how (and if) changes can be enacted to suit the particular needs of the physician and how to deal with a larger chain of command and bureaucratic red tape.


Computer systems don't always keep the physician in mind. Compound this with a larger organization, like a hospital, and a fair amount of adjustment may be in order for the transitioning private practice physician. For example, in a small private practice, a simple computer system may be all a practice needs to sustain itself. Many private practice physicians may still do much of their work without the aid of electronic health records, and may depend on an experienced staff to just be knowledgeable and helpful in these situations.

Once in a larger institution, computer and electronic systems must become useful to a variety of physicians across a variety of needs, functionalities and specialties. This may lead to problems for those looking to make their transition as smooth as possible.


It's easy for even the conscious private practice physician to move to a larger institution with a clear expectation of how much they'll make. Even with the promise of guaranteed payments, these physicians may see an increasing number of patients covered by Medicare, Medicaid and even those who are uninsured altogether. Furthermore, private practice physicians with in-office lab testing may see some of this revenue now going to the hospital instead of their own efforts. These all chalk up to important financial factors for physicians to consider which they might not have in their own practice. While hospital salaries are usually constructed with a set fee per year, along with a productivity bonus tied into RVU's (Relative Value Units), newly hired physicians may see their salary decrease because of factors which exist beyond their control, like internal administration politics which result in fewer referrals from the hospital.

Wise physicians will take a clear look at their situation and ask if they can live off of their base salary, even if they don't get a bonus. They'll also negotiate payment for administrative time. With a move towards compensation that favors quality metrics, patient satisfaction metrics and disease management metrics. Physicians moving from their own private practice to the large pond of a hospital need to determine how they'll be affected, and if these payment metrics differ, along with the preventive medicine model, from their own and if they'll need to change anything to adapt.

(Lack of) Mission Congruence

Though it's not always an easy issue to plan for, it's one with major effects. With an organization featuring more proverbial cooks in the kitchen, physicians must determine whether or not they can be unified in their own vision of care (particularly those in primary care working with specialists). With high-need patients, care managers, effective registries and the free movement of information must all be at a primary care physician's disposal, so they need to determine if this will be available to them within the structure of a large hospital. Furthermore, they should look at their own philosophical ideas behind medical care, as well as the hospitals "institutional footprint." How much emphasis does the institution place on high-margin activity compared to community activity? How well can the institution support the need for technological advancement.

Non-Compete Clauses

In the unfortunate, if not unanticipated event, that a physician leaves or is let go, what happens to all the patients? Once they've become integrated into the hospital network, it can be extremely difficult for physicians to stay with them if they're terminated.

Physicians planning for these situations should fully examine any non-complete clauses in their contracts, and bring an attorney on board. How a patient is handled, after a contract expires, can be an extremely important factor for a primary care physician leaving the hospital network.


Regardless of any uncertainties facing private practice, big-picture numbers and stats aren't any siren signal for physicians to abandon their private practice for calmer seas. Security may be a factor, but it's still an extremely case-by-case scenario, one which physicians should carefully examine before making any big decision. In the long run, what draws many physicians into private practice is an entrepreneurial spirit, and the autonomy to best care for their patients, and so, regardless of any economic uncertainties, they still want to preserve that. Perhaps, given the circumstances, this is as important a time as ever for them to stay in private practice.


Caffarini, Karen. "Staying in Private Practice Offers Its Own Rewards."
American Medical News, 18 July 2011. Web. 12 Sept. 2013.

Finger, Anne L., MA. "5 Risks of Being an Employed Doctor."
Medscape, 13 Aug. 2013. Web. 12 Sept. 2013.

Kavilanz, Parija. "Doctors Selling Their Practices." CNNMoney.COM.
Cable News Network, 16 July 2013. Web. 12 Sept. 2013.

Litton, J. S., Jr. "Being a Solo Private Physician: Should I Stay or Should I Go?" Physician's Practice, 3 Aug. 2012. Web. 12 Sept.

Lowes, Robert. "Physician Headhunters Now Work Mostly for Hospitals." Medscape, 6 Sept. 2013. Web. 12 Sept. 2013.

Dylan J. Chadwick


Dylan Chadwick is a graduate of Brigham Young University where he earned a Bachelor of arts in English and a minor in Spanish. Though spending his formative years in Cardiff Wales, he came to adolescence in Elizabethtown Kentucky, and considers it his home. He received the Eagle Scout Award, served a voluntary humanitarian mission to inner-city Los Angeles from 2007 to 2009, and once met Alan Alda on a golf course. He's an avid writer who cut his teeth contributing to student papers and continues writing for various print magazines, blogs and web resources. A ravenous fan of baseball, rock music and Dan Aykroyd-era Saturday Night Live, he plans on one day utilizing these interests in a Masters degree in American Studies and Literature. He also maintains a freelance illustration company on the side.