Private medical practitioners are struggling in the face of innovation, technological transformation and regulatory and rules changes that are increasing their costs of doing business, changing delivery channels, lowering their revenues and interfering with their ability to take care of patients. While there are some indicators that the employed physician trend is flattening, most residents and medical school students say they are not interested in working for themselves, particularly the increasing number of women medical graduates.

A new survey from the American Medical Association found that 2018 marked the first time that more doctors were employed by provider organizations rather than owning their own practices. Back in 1983, 75% of physicians were independent, but in 2018 only 45.9% owned their own practice, according to Axios. Consolidation is a major driver of this trend.

However, there are signs that the trend to private practice is increasing.  More than half (52%) of all self-employed doctors responding to Medscape’s 2014 Employed Doctors Report say they were previously employed, and anecdotal reports suggest the share may be rising.

The impact of Obamacare and the rules and regulations that have been promulgated as a cause of all this is debatable. Some think that neither Democrats or Republican administrations can save it. Now that there is a new sheriff in town, we’ll have to await the outcome of the shootout at the OK corral.

Is it worth saving private practice? I believe it is essential because:

1. A significant percentage of patients prefer to get their care from private practitioners.

2. Private practitioners are more nimble innovators

3. There are limits to BIG MEDICINE consolidation and private practitioners fill the void. Like the states are to the federal government, private practices are laboratories of creativity.

4. Medical practice entrepreneurs want to work for themselves, add value to their patients and keep what they earn

5. Innovation ecosystems, the engines of regional and US global competitiveness, are driven , in part, by medical practice entrepreneurs

6. Successful medical practice entrepreneurs have a multiplier effect, providing high wage jobs

7. Generational attitudes are driving the demand for opportunities in the sick care sharing and gig economy

8. Voters have lost confidence and trust in the ability of “big anything” to improve their lives and that of their families

9. Historic lows in US productivity , particularly in the sick care sector, needs attention and will only come from innovation

10. It is the American thing to do and why other countries look towards us as the global leader in biomedical and clinical innovation and how we create innovation ecosystems

11. Less burnout compared to employed physicians. Just 13.5 percent of providers who work in SIPs reported being burnt out, according to a study published in the Journal of the American Board of Family Medicine, titled “Correlates of Burnout in Small Independent Primary Care Practices in an Urban Setting.” Physician burnout is a major driver of turnover, resulting in direct costs associated with recruitment. It also contributes to lost revenue during recruitment, onboarding and the time it takes for a new physician to reach optimal efficiency within a new system. Replacing a physician often costs a practice two to three times the annual salary of the physician who left.

For example, if nothing were done to address burnout, almost 60 physicians would leave Stanford Medicine within two years. The cost of recruitment for each physician—depending on the specialty and rank of faculty—would range from more than $250,000 to almost $1 million. And, for those 58 physicians, Stanford’s economic loss over two years would range from a minimum of $15.5 million to a maximum of $55.5 million.

12. Here’s how to start and run a private practice taking advantage of the opportunities.

Saving private practice will take following the rules of Othercare. Here’s how one start up is accepting the challenge. The doctor-technologist-entrepreneur is the new triple threat.

In addition, we are experiencing the next wave of consolidation, as demonstrated by the CVS-Aetna merger, from horizontal to vertically integrated systems independent from hospital based integrated delivery systems. Consequently, CVS will be the new community health center and “convenience and coordinated care centers” will draw traffic away from lagging primary care offices and inappropriate urgent care visits. Convenience and coordination now trumps credentials.

As of 2015 (the most recent healthcare employee turnover data available), the turnover rate among primary care and family medicine physicians averaged around 14%, annually. As the turnover rate of non-physician sick care professionals continues to increase, it is not unreasonable to expect the same increase in employed physicians. Here’s what to do when your white coat gets the pink slip.

Saving private practice is mission critical if we are to win the war against escalating costs and further system deterioration. Look for the Spielberg movie soon at a theater near you.

Arlen Meyers, MD, MBA is the President and CEO of the Society of Physician Entrepreneur