Is it true that doctors who own practices have the potential to get rich?

[Twanson]

I know that doctors who work for a salary are limited when it comes to the amount of money they can make but I want to learn more about the owners? Do the doctors who own practices really have the potential to make a fortune? Thanks!

 

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[16thCylinder]

Some information here:

http://www.practicewealth.com/

 

[DennisD]

Do the doctors who own practices really have the potential to make a fortune?

Everybody has the potential to make a fortune if you make the right moves.

 

[healthstatus]

In the US with the new healthcare laws, it is going to be more difficult to do that in the future than it has in the past.

 

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[jlwilliams]

The question is pretty close to asking "ok, cooks get paid hourly, but can a restaurant owner get rich?"
Am I missing something in the post?

 

[Esquire]

Sure. No less so than lawyers. It's possible.

Not probable. But possible.

And certainly not something I would bet the farm on.

Like any other business ... you have to compete ... and coming straight out of medical school ... with no experience ... no reputation ... limited resources ... and (more likely than not) a young looking face (a material handicap) ... the deck is seriously stacked against you.

And this speaks nothing of sky high med-mal insurance costs ... business overhead and the like. Not cheap.

It may take a decade (or more) to get established and achieve respectable profitability ... assuming you last that long.

An advanced professional degree is not a path I would recommend ... unless it was truly your life's calling or passion. Don't do it "to get rich." Most will not.

I don't know ... what do you think ... @Iwokeup ?

 

[Iwokeup]

Sure. No less so than lawyers. It's possible.

Not probable. But possible.

And certainly not something I would bet the farm on.

Like any other business ... you have to compete ... and coming straight out of medical school ... with no experience ... no reputation ... limited resources ... and (more likely than not) a young looking face (a material handicap) ... the deck is seriously stacked against you.

And this speaks nothing of sky high med-mal insurance costs ... business overhead and the like. Not cheap.

It may take a decade (or more) to get established and achieve respectable profitability ... assuming you last that long.

An advanced professional degree is not a path I would recommend ... unless it was truly your life's calling or passion. Don't do it "to get rich." Most will not.

I don't know ... what do you think ... @Iwokeup ?

Agreed.

I've said it before, but getting an advanced professional degree (in my case both a MS in Genetics AND the MD) is worthless as the sole path to 'riches.'

Like so many other things these days, if you don't have CONTROL then you're in a bad, bad spot.

Also, what is "a fortune"? Is it $1MM/year in net proft? $10MM/year? More? Very very difficult to scale the medical practice due to the violation of the commandment of TIME, unless you are the one running the show....having other people work for you as "partners" or employees and they spend the TIME generating revenue.

Also, and this is HUGE: medical malpractice is a REAL THING. It's expensive ante, and even more expensive posterius. (@Esquire, did I use that correctly?)

PLUS: government regulation and the crushing of the individual practice UNLESS you are strictly cash only and DO NOT acccept government health insurance like Medicare/Medicaid.

PLUS there are MASSIVE movements in place (and definitely under the radar) that are aimed solely at forcing physicians (through multiple means) into being EMPLOYEES of hospitals. It's truly only a matter of time until there's a push to make them GOVERNMENT EMPLOYEES (no hyperbole).

 

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[Get Right]

I have a dear friend that went this route. He's the best Pediatrician within 3 counties. Owns not only his practice but another. Fully booked, and makes lots of bank......but......I never see the guy.

Example - we had dinner at his house last week. We were there for probably 3 hours. Had a great time with his wife and kids. I never said one word to my friend though. He was on the phone all day/night with patients. This happens every time we get together, its his life.

Let's take another friend. This friend manages a group of doctors. We hang out a lot and he NEVER answers his phone. He doesn't even have an office and not sure he owns anything besides shorts and t-shirts. His life is whatever he wants it to be.

Now for the riddle - Which one do you think makes more $, spends more time with his kids, has more scale-ability, is less likely to be injured on the job, etc....

Verdict - professional degree'd people that work in their profession have violated SCALE and TIME right out of the gate.

 

[xuyigang]

I am a CPA, I did not know MJ'S book when I started business. This is very true of professional business I have heard many lawyers say the same thing.

Sent from my SAMSUNG-SGH-I337 using Tapatalk

 

[Mattie]

I think I witnessed the idea of making the doctor's office into a number system and go under and Umbrella system, and the Doctor's usually left town, because they didn't like how it was run. And they usually couldn't practice in the local hospital if they don't agree to the terms. I ran into this when my son had been ill and we sat in the E.R. for like hours waiting for the hospital to find a doctor who would take my son because they wouldn't authorize my Doctor to admit him. That was back in 1997. And later in 2005 or somewhere around there they made it even worse, separated the company from the hospital. And than all your insurance plans and medicaid screw up things.

I know one of them did manage to be a separate private practice and he was separate from the company, had his own building, and was making money, but I'm not sure what he did differently, than the other ones. His daughter and him had their own office and it was very nice and they paid for it themselves. I know he fought though with the Umbrella system. He didn't want any part of it, and gave better care. And then also there were other Doctors that moved out of the area for the same reason. We lost many of them, so I think they probably can make money in certain locations, but others I think they end up losing money.

Again they changed a few years back before I left, so the seems really the rules keep changing, and I think the ones I heard talking was basically wanting to retire and get out of it because it's a lot of headache and liability and malpractice issues.

 

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[Cascade]

I know that doctors who work for a salary are limited when it comes to the amount of money they can make but I want to learn more about the owners? Do the doctors who own practices really have the potential to make a fortune? Thanks!

Can you be more specific?

IMO
"Doctors" is too generic for a response to here to be really helpful to your situation e.g. there are surgeons and physicians; both are doctors but their lifetime earning paths are very different

A practice? can be run such that the doctor is still working for a salary that happens to be paid by the practice that is owned by said doctor

a lot depends on whether the business owner is able to disconnect TIME from Earning

some have done quite well and built businesses
some have multiplied their time leveraging on other medical professionals and/or junior doctors
some have left a hospital only to be drawing a "salary" from their own practice


Any consolation is that (at least in my part of the world) a doctor leaving for private practice would have to be (un)lucky and strive quite hard to NOT make the transition work. Almost all succeeded to earn a good living.

 

[mayana]

I know that doctors who work for a salary are limited when it comes to the amount of money they can make but I want to learn more about the owners? Do the doctors who own practices really have the potential to make a fortune? Thanks!

It's just like anything else - you have to make the right moves.

I know someone who owns several dental offices in the NYC area and does extremely well. It's taken a long time to build it up, but it can be done.

 

[cr1]

I know that doctors who work for a salary are limited when it comes to the amount of money they can make but I want to learn more about the owners? Do the doctors who own practices really have the potential to make a fortune? Thanks!

Healthcare laws have changed. There is a significant opportunity in healthcare. Docs who own their own practices can use telehealth and other
technologies that have been around to increase revenue. This requires some background knowledge of the industry like anything else but sure it's possible.

 

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[Iwokeup]

Healthcare laws have changed. There is a significant opportunity in healthcare. Docs who own their own practices can use telehealth and other
technologies that have been around to increase revenue. This requires some background knowledge of the industry like anything else but sure it's possible.

Yes, but it still massively violates the commandment of TIME.

 

[E-Sharp]

Great topic and thread. I'm not a doctor, but am a master's level therapist with a private practice. This discussion applies not just to MD's, but to a wide range of healthcare practitioners in private practice.

The changes in US healthcare law are bad news for private practice. @Iwokeup's post above articulates the major issues, and I agree with everything there.

Any practice that relies on insurance - not just Medicare/Medicaid, but any insurance - is ceding control. There is a constant downward pressure on reimbursement rates, and insurance companies can (and do) whimsically drop the rates by double digit percentages. To offset that, providers have to increase their caseload. Sure, you can get around that by being a cash-only practice, but most patients expect to use the insurance they're forced to purchase. And a cash practice is still a time-for-dollars operation, as others have pointed out.

Telehealth and related technology may be an opportunity. If a doctor is just providing the same services over the internet that he would in an office, the technology is merely a different route of service delivery, and one that carries additional risk for the provider (how do you accurately diagnose physical problems without examining the patient?) I do think there are opportunities available in this area, but mostly they require developing different offerings and services.

Yes, the income potential definitely expands for the owner of a group practice, but so does the work and time spent in the business. Also, the usual pathway to a group practice is first starting a solo practice, filling it, then expanding it. And all the above stuff still applies to group practices.

 

[MJ DeMarco]

I just heard about this transaction which is local to Arizona, started by a group of anesthesiologists. My guess is the value of this transaction was about $25-50M.

http://www.businesswire.com/news/ho...an-Services-Division-Sheridan-Acquires-Valley

Indeed things have changed since I wrote TMF and the intense regulation definitely would play a danger to TIME.

 

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[cr1]

Yes, but it still massively violates the commandment of TIME.

Yes, running your own practice can bring a limited amount of growth. There is a limit to how many patient you can see, for example.

I run a telehealth company that is a platform for specialty services like cardiology. We provide these services using telemedicine and we bill
the hospitals for our services. I have no overhead, contract the work out and work with rural hospitals, health plans, disaster relief organizations etc.
to provide specialist care.

We can increase capacity to see more patients, while improving outcomes.

I just added Psychiatry to our service line.

 

[cr1]

Anyone here interested in a healthcare entrepreneurship course?
If so tell me who you are and how this would help you.

 

[jazb]

I think this is a more of a vocation than a profession. There are better ways to get rich in the medical industry

 

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[cr1]

I think this is a more of a vocation than a profession. There are better ways to get rich in the medical industry

Interesting. Tell me more. Medical device? Pharma, Marketing? One of the problems is the long sales-cycles to close a deal.

 

[Vigilante]

Excerpt from Tony Robbin’s book “Money – Master the Game”

“Theodore Johnson worked for UPS and never made more than $14,000 a year and yet, in his old age, was worth more than $70 million. When he said he had no money to save, a friend told him that if he were taxed, the money would be taken out of his account and he’d never see it. So he created a tax for himself to make him wealthy. Even though he made little money, he took 20 percent of his money and it went straight into an investment account. Over more than five decades, that compounded to make him $70 million.”

Robbins might have gotten his information from this story

http://www.nytimes.com/1991/10/15/us/retiree-donates-fortune-to-education.html

 

[ModernAlpha]

I get your question is coming from a curious place, but the way you worded it expresses something to me..

The underlying conclusion from your question is that you're considering starting a practice ONLY IF enough fastlaners tell you it can make you rich. You're caring more about MAKING A FORTUNE, than actually helping people/solving problems. Not the best mindset.

Also, what is "a fortune" to you. Some people consider $100k/year a fortune, some people consider $100k/week a fortune.

I also believe any idea executed correctly can be worth millions. Look at Domino's Pizza.. they sell pizza. H&R block.. they do taxes.

If you start the H&R block of doctor practices then you'd make "a fortune".

Hope this helps!

 

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[Captain Jack]

I'm a health care provider as well (though not a physician). I wouldn't recommend going into it for monetary gain. I, honestly, wouldn't recommend it for career stability either. Based on my experiences and observations, I don't believe that being a provider is stable.

Also, I wouldn't recommend starting a practice as a physician. Like many others have said, there is declining reimbursement and significant insurance-related headaches. Doctors with their own practices tend to work non-stop without an end in site. There is no exit plan except getting your license revoked or death.

Do some physicians do well? Sure, but the vast majority are not millionaires. And look at how long it took to get there. Four years of undergrad, 4 years of med school, at least 3 years of residency, and 5+ years paying off their loans. They are breaking even after 16 or so years (at least) and then have to worry about getting sued, getting reported to a national database if they piss of their employers, etc.

In those 16 years, you're better off learning how to sell. If you spent 16 years selling, you'd probably be a billionaire by the time doctors break even.

Excerpt from Tony Robbin’s book “Money – Master the Game”

“Theodore Johnson worked for UPS and never made more than $14,000 a year and yet, in his old age, was worth more than $70 million. When he said he had no money to save, a friend told him that if he were taxed, the money would be taken out of his account and he’d never see it. So he created a tax for himself to make him wealthy. Even though he made little money, he took 20 percent of his money and it went straight into an investment account. Over more than five decades, that compounded to make him $70 million.”

Robbins might have gotten his information from this story

http://www.nytimes.com/1991/10/15/us/retiree-donates-fortune-to-education.html

Look at the date of that article: 1991. This man was 90 years old at the time. This means that his prime working years were from the 1920s to the 1960s. His bank interest alone was probably around 8%. Of course, he experienced the Great Depression, but it was a time where he likely had little competition for jobs (since women and minorities had not entered the primary work force, for the most part) and making passive income from banks and the stock market was still possible.

Tony Robbins appears to be misapplying this advice because, as we all know, it would not work today.

 

[ModernAlpha]

I'm a huge fan of Tony Robbins first two books, but I was actually hugely disappointed with Money Master the Game. It should have been called Slowlane 101 lol. I seriously can't believe Robbins didn't mention starting a business as a valid plan. It's a huge book that covers the basic compound interest over time to become a millionaire in 70 years. Since he's earned millions as an entrepreneur, I was shocked he suggests slowlane to the masses. Complete letdown for entrepreneurial Robbins fans

 

[Vigilante]

I'm a health care provider as well (though not a physician). I wouldn't recommend going into it for monetary gain. I, honestly, wouldn't recommend it for career stability either. Based on my experiences and observations, I don't believe that being a provider is stable.

Also, I wouldn't recommend starting a practice as a physician. Like many others have said, there is declining reimbursement and significant insurance-related headaches. Doctors with their own practices tend to work non-stop without an end in site. There is no exit plan except getting your license revoked or death.

Do some physicians do well? Sure, but the vast majority are not millionaires. And look at how long it took to get there. Four years of undergrad, 4 years of med school, at least 3 years of residency, and 5+ years paying off their loans. They are breaking even after 16 or so years (at least) and then have to worry about getting sued, getting reported to a national database if they piss of their employers, etc.

In those 16 years, you're better off learning how to sell. If you spent 16 years selling, you'd probably be a billionaire by the time doctors break even.



Look at the date of that article: 1991. This man was 90 years old at the time. This means that his prime working years were from the 1920s to the 1960s. His bank interest alone was probably around 8%. Of course, he experienced the Great Depression, but it was a time where he likely had little competition for jobs (since women and minorities had not entered the primary work force, for the most part) and making passive income from banks and the stock market was still possible.

Tony Robbins appears to be misapplying this advice because, as we all know, it would not work today.

You missed the point. The point is not the roadmap. The original question was whether or not XXX profession can get rich. Any professional can get rich if you apply unconventional thinking and current strategy to investing.

I'm a huge fan of Tony Robbins first two books, but I was actually hugely disappointed with Money Master the Game. It should have been called Slowlane 101 lol. I seriously can't believe Robbins didn't mention starting a business as a valid plan. It's a huge book that covers the basic compound interest over time to become a millionaire in 70 years. Since he's earned millions as an entrepreneur, I was shocked he suggests slowlane to the masses. Complete letdown for entrepreneurial Robbins fans

Re-read it in a few years. He talks a lot about using money to make money. It's not a get rich quick book.

You guys seem to be looking for a roadmap. You have to take the best of the paradigm shifts and apply them to current market conditions. Don't copy a business, copy a process. Don't copy a product, create a value. Don't copy a specific investor story, get inspired by unconventional thinking.

You could spend the rest of your life on this forum and nobody is going to give you a roadmap.

In the 1980s it was little tiny classified ads. In the 1990s, it was flipping real estate. In the last decade, it was anything e-commerce. In the last few years it was funnels. If you continue to follow the crowd looking for a game plan… Somebody will sell you one.

 

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[ModernAlpha]

I actually did learn quite a bit from it, especially the Billionaire interviews (love how they play the game to avoid risk, not to make aggressive gains), but was just let down by no mention of business as way to make money. I thought Tony Robbins on money would be like: remove your negative wealth beliefs, start adding massive value to others, creating a business is the best vehicle to do that, leave a legacy that helps the world, etc.

And I definitely agree, for people with a big bankroll to start with, the book holds way more value. But then again, he could have touched upon real estate investing if that was his target market. If you have big funds and can buy with cash, I feel real estate is a more solid investment than mutual funds, especially for cash flow

 

[jazb]

Interesting. Tell me more. Medical device? Pharma, Marketing? One of the problems is the long sales-cycles to close a deal.

Solve a problem

Think how you can make lives easier in that industry. there has to be millions of possibilities

 

[Chris Kelsey]

There's a lot easier business models to succeed in, without the 8-12 years of schooling (and potential school debt). You can definitely get "rich" with a practice, but then again, what do you define as rich?

 

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