8 Benefits of Starting a Private Medical PracticeApril 13, 2022
After surviving medical school and residency, you might be hoping for more flexibility in your schedule. But if you are like the 73% of physicians with medical student loan debt, your loans may be a driving factor in deciding where to work.
If you ever dreamed of being your own boss one day to have a more flexible work schedule but are afraid student loan debt would hold you back, it would be helpful to know a private practice doctor’s salary when deciding your career path. Private practice and working at a hospital both offer benefits and drawbacks, but which option is better is based on the person.
Here we will lay out a private practice versus hospital salary and the benefits of starting a private medical practice.
Private Practice Versus Hospital Salary
When answering “how much do private practice doctors make,” the answer depends on the doctor’s specialty. A survey by Doximity reported in the 2021 Physician Compensation Report that when comparing the average salaries between a private practice versus hospital salary, controlling for specialties, a solo practice physician made slightly more, earning $415,678 versus $399,282 for a hospital physician.
The difference in average salaries is not significant, but many more perks are associated with starting a private medical practice beyond the salary.
Benefits of Starting a Private Medical Practice
When considering starting a private medical practice, it’s natural to wonder how much private practice doctors make. As discussed above, there is not much discrepancy between the salaries. However, private practice can allow for a greater potential than what you may receive at a hospital position. The salary may be capped at a hospital based on the hospital’s budget, whereas in private practice, the limit is based on the number of patients the physician can handle. The only drawback of a private practice doctor’s salary is it may not be a consistent amount in the early years when trying to build the practice, and the income can fluctuate from year to year.
More Flexibility for Schedule
This is a major benefit to private practice to gain a better work/life balance. In private practice, you can set your hours and take time off as needed without approval from hospital administration. The flexibility also means you can enjoy your weekends and holidays that may be required workdays at a hospital.
Build Relationships with Patients
In private practice, you are more likely to see the same patients year to year and build rapport and relationships with them. In a hospital setting, you may be less likely to have repeat patients and therefore not able to build a relationship with patients.
Create an Asset
Beyond the benefits of starting a private practice, opening a private medical practice can provide benefits well into the future. You can do this by building up the practice and selling it when it comes time to retire, giving you a substantial lump sum for retirement, or taking on additional physicians in the practice and continuing to receive an income in retirement. Consider the future assent potential when answering how much private practice doctors make.
More Decision Making
Having your own medical practice allows you to make more decisions. There will be no oversight and need to request items, an issue that physicians may face in a hospital. However, with this freedom comes the need to make some of the administrative decisions regarding running the office and business. So keep this in mind if you would prefer to focus on the medical side rather than the business aspects.
Choose Your Coworkers
With a private medical practice, you can hire physicians and nurses who have similar treatment philosophies as your own or conversely, hire individuals with different ideas or skill sets.
Although the share of physicians employed as independent contractors is still low, at only 5.8% in 2020, some hospitals prefer using independent contractors rather than employees. If your contract is not renewed before it ends, you may be looking for another job. Having a private medical practice provides more job security provided you build a strong practice with many patients.
You are less likely to experience burnout when you are working at your private medical practice. You have the ability to control your own schedule and facilitate an environment that allows for work-life balance.
Starting a Practice
If you have decided starting a private medical practice is right for you, but student loans are hindering you, try refinancing your student loans with ELFI to help better manage your loans and reduce your monthly payment.* This can free up additional funds to start your practice and can potentially save you thousands of dollars in interest costs over the life of the loan.
There are many great perks to starting a private medical practice, including the private practice doctor’s salary. Between good compensation and work-life balance flexibility, starting a practice is a good option for many.