CHERRY HILL, N.J., Sept. 19, 2016 /PRNewswire/ -- Financial
pressures and uncertainty about the future of the American
healthcare industry are changing the way independent physicians and
other medical professionals run their practices, finds a survey by
TD Bank, America's Most Convenient Bank®. These concerns
impact everything from the way a practice is established to
technology investments and even retirement outlook.
According to TD Bank's survey of more than 340 small medical
practices in the U.S., 39 percent of physicians purchased a
partnership in an established practice or an existing practice,
while 37 percent started it from scratch.
Another change: More women are becoming practice owners. While
respondents have been in practice for an average of 16 years, 36
percent of women reported owning their practices for less than five
years, while 47 percent of men have been in practice for more than
20 years.
When assessing the future, 50 percent of doctors surveyed either
have or would consider purchasing, buying into, merging or selling
their practice. Among these medical professionals, 73 percent
expected to do so within the next four years. Why make such a
change? Forty-six percent of respondents explained that it's simply
too expensive to run a practice today.
"We are seeing a growing trend of more healthcare providers
buying into practices with a partnership or purchasing an existing
practice because they are seeking added financial security and
well-established businesses," said Dan
Croft, Head of Healthcare Practice Solutions, TD Bank. "The
survey findings reflect a shift in the industry because of the
rising cost of doing business — from technology to insurance."
Financial Trends and Practice Management Concerns
In
general, medical practices are growing, with 43 percent of
respondents expecting to increase revenue over the next two years.
Of those surveyed, women (56 percent) and Millennials (75 percent)
are most optimistic about expected revenue growth. The most popular
methods for financing the needs of a practice — including new
equipment, computers, practice management software, practice
acquisitions and practice buy-ins — are lines of credit (41
percent) and cash (36 percent). While Millennials (53 percent) are
most likely to prefer using a line of credit, Baby Boomers (40
percent) use cash to finance their needs and Gen Xers are more
likely to use credit cards (31 percent).
When asked about investing in the next few years, medical
practitioners noted the following as priority areas to which they
anticipate committing capital spending:
- Buying or leasing new technology – 48 percent
- Hiring more staff – 33 percent
- Training and education – 26 percent
Among their current biggest challenges, physicians named
receiving timely reimbursements from insurance providers (52
percent); managing overhead costs such as supplies and rent (51
percent); and keeping up with technology (35 percent).
Generationally, Millennial medical practitioners stated one of
their greatest concerns is staffing and hiring as they build their
practices, while Baby Boomers named new technology (41 percent).
Others are concerned about the approaching national elections, with
56 percent of medical professionals very or extremely concerned
about the election's implications on the healthcare industry.
Retirement Plans
As with most U.S. workers, finances
are dictating retirement decisions for doctors. Eighty-four percent
of medical professionals under age 35 who were surveyed think
they will retire by age 65, while 76 percent of doctors
currently 55 years old or older believe they will have to retire
after age 65. More specifically, 30 percent of physicians
across all age groups report they will have to postpone their
retirement to later than originally planned.
A majority (56 percent) of medical professionals expect partners
or colleagues to take over the business when they retire, while 19
percent will sell their practice and 14 percent anticipate simply
shutting their doors. Fifty-five percent of physicians also expect
retirement to be a gradual transition during which they will cut
back on hours. When asked about their financial future:
- Forty-nine percent of physicians report they are extremely or
very financially prepared for retirement.
- Forty-eight percent are extremely or very confident that their
practice sale, combined with their savings/ investments, will
provide them with enough funds for retirement.
- Male (54 percent) practitioners are more confident than females
(37 percent) when it comes to believing that they have enough cash
to support their retirement years.
"It is understandable why many near-retirement age physicians
plan to cut back on time in the office, but this is not the best
strategy," Croft said. "Decreasing hours or patient load can
negatively impact practice or partnership value, thereby affecting
retirement plans. While most physicians said they are confident
they will have enough money to retire, that's not always the
reality, and often it is due to the fact that they made changes in
their schedule or practice that derailed their plans."
Survey Methodology
TD Bank's survey was conducted
among a nationally representative sample of 342 U.S.-based
respondents consisting mainly of physicians (90 percent) including
general practice/family medicine, internal medicine, pediatrics,
OB/GYN and other specialties. The survey also gauged sentiments
from other types of medical professionals (10 percent) including
dentists, veterinarians and optometrists. Generations are defined
as Millennials (ages 18-34), Gen X (ages 35-54) and Baby Boomers
(ages 55 and older). The survey was hosted by MARU VCR&C and
was conducted Aug. 7-12, 2016.
About MARU
MARU/VCR&C, formerly the Research
& Consulting division of Vision Critical, is a professional
services firm dedicated to improving its clients' business
outcomes. It delivers its services through teams of sector-specific
research consultants that have technology in their DNA,
specializing in the use of Insight Community and Voice of Market
technology. MARU/VCR&C's research drives decision-making across
all aspects of customer experience, including innovation, product,
branding, commercialization and communications.
About TD Bank, America's Most Convenient
Bank®
TD Bank, America's Most Convenient Bank, is
one of the 10 largest banks in the U.S., providing more than 8
million customers with a full range of retail, small business and
commercial banking products and services at more than 1,200
convenient locations throughout the Northeast, Mid-Atlantic, Metro
D.C., the Carolinas and Florida.
In addition, TD Bank and its subsidiaries offer customized private
banking and wealth management services through TD
Wealth®, and vehicle financing and dealer commercial
services through TD Auto Finance. TD Bank is headquartered in
Cherry Hill, N.J. To learn more,
visit www.tdbank.com. Find TD Bank on Facebook at
www.facebook.com/TDBank and on Twitter at
www.twitter.com/TDBank_US.
TD Bank, America's Most Convenient Bank, is a member of TD Bank
Group and a subsidiary of The Toronto-Dominion Bank of Toronto, Canada, a top 10 financial services
company in North America. The
Toronto-Dominion Bank trades on the New
York and Toronto stock
exchanges under the ticker symbol "TD". To learn more, visit
www.td.com.
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SOURCE TD Bank