Medical Partnerships and other professional partnerships are faced with significant challenges today. As the proportion of physicians over 65 increases, so does the importance of transition planning for these partnerships.
“Young doctors are increasingly taking salaried jobs, working fewer hours, often going part-time and even choosing specialties based on lifestyle reasons. The beepers and cell phones that once leashed doctors to their patients and practices on nights, weekends and even Christmas Day are being abandoned. Metaphorically, medicine has gone from being an individual to a team sport.”
“Over 20% of the nation’s physicians are over 65, and that proportion is expected to rise.”
— New York Times, January 2011
These are two significant challenges that face many professional partnerships today. Increase retirements and changing lifestyle needs and wants of the next generation. How can a firm manage this succession?
Professional Partnership is Business entity formed by two or more professionals such as accountants, doctors, or lawyers, who provide professional services to the public.
Great medical practices need to plan for the retirement of the partners. Many of these practices have discussed the issue but do not have a plan.
The Top Ten points to ponder are:
1. An agreed retirement age
• How does the Practice handle exceptions
• Early departure
• Desire to stay longer
2. How do you recruit and replace?
3. Develop a phase down plan-reducing hours.
4. Will you employee other type’s of staff to smooth the transition?
5. How do these costs affect the business plan?
• Will compensation be reduced during the phase down?
• Is there a capital buy out?
• Is there a retirement allowance?
7. Client transition
• Understand the firms demographics
• Do hospitals need to be considered?
• Non –Profits, community touch points?
8. What is the plan to integrate new members into the firm?
9. When and how do you integrate them into the “leadership”
10. How do you handle retired members?
• Do they keep an office?
• Do you invite them to certain events?
• Do you ask them to handle some community relations work?
• How do you compensate them?
Developing a plan will cause a debate. The partners will not all agree. There will be issues. These will be easier to handle sooner than later.
Data from a top physician recruitment firms, reported that 51 percent of the positions it filled in the past year were for hospitals, up from 14 percent eight years ago
This list by no means complete there are other points to consider. A few final points to ponder are which member of the current practice has the time to lead this effort? Are there incentives available to help attract talent? Oklahoma, Illinois and Mississippi already have plans in place to attract and keep young doctors for a period of time. An additional and often over looked point is what will the effect on practice chemistry be with personnel changes.