Weiguo Zhou 周卫国, MD (Class-77)
Dallas, TX

Anesthesiologists practice medicine in either academic or non-academic settings. Here we will discuss non-academic anesthesia (or private practice) and different private practice models.

Firstly, a fact of life in private medicine is the business aspects of medicine. Whether you like it or not, personal relations are every bit as important as medical skills. Basically, you are in medicine and also you are in business. Business is about making a profit. Surgeons in private practice are driven to be more productive and efficient since they are paid largely based on the numbers of surgeries they perform, rather than how much time they spend on each case. They demand fast turnover between cases and anesthesiologist is the key part of the fast turnover. As result, it is sometimes very challenging to maintain a high level of quality of patient care and at the same time to meet surgeon’s demand. Having said that, business is not necessarily in conflict with medicine. Being able to achieve a high level of quality of patient care while understanding the business aspects of private practice will motivate anesthesiologists to be more skillful and innovative. In this sense, good medicine implies good business, and vice versa.

Secondly, anesthesia private practice has its unique aspects. Surgeons are your customers and anesthetizing patients are your products. You will be expected to be a “team player”, meaning you are available, affable, and able to accommodate surgeon’s schedule at late hours and weekends. If you are apathetic or unresponsive to surgeon’s needs, your customers (i.e. surgeons) will take their business elsewhere.

Generally speaking, there are three major anesthesia jobs available in private practice: anesthesiologists hired by hospitals, solo practitioners, and anesthesia groups.

1. Anesthesiologists hired by hospital

The physicians are on some type of compensation plan provided by the hospital. With a hospital (non-academic), you are usually dealing with an established employee contract, there is no buy-ins, and your hospital is usually trustworthy. The other advantage is that you do not have to worry about your patient's insurance as the hospital will do the billing and pay you a guaranteed salary regardless. However, security comes at a price. Physician autonomy is diminished and your earning potential is limited. Since everybody is paid the same, this system does not reward production and efficiency.

2. Solo practitioners

Solo practice is exactly as you would imagine. That means practicing without partners or employment affiliations. The single most important advantage of the solo practice is autonomy; you are the boss and make all the decisions. On the other hand, carrying the entire burden of running the practice, lacking coverage for emergency and vacations, and increased risk of suffering financial setbacks are the disadvantages.

3. Anesthesiologist group

Group practices are probably the best and most popular model to set up anesthesia private practice. The advantage of this practice option is the ability to assume more risk, more effective managed-care negotiations, and a large referral network of practices. But anesthesia groups are not all the same. The setup of group practice varies from group to group and from area to area.

Hospital-based group. The group contracts with hospitals to provide services to that hospital. The hospital does not pay the group, in stead the group charges insurance separately for their anesthesia services.

Non hospital-based group. Private practice in Dallas area is different from other parts of the nation. Hospitals and surgical centers do not offer exclusive contracts with anesthesia groups and are therefore open to any anesthesiologists. Anesthesiologist groups recruit surgeons to provide anesthesia services and they only cover their own surgeons in multiple hospitals and surgery centers.

The most popular system for non hospital-based group setup is that money is pooled for the entire group and fee for service is based on group average unit. Members of this group are paid by work hours. You work more and you earn more. So this system avoids scheduling manipulation, ignores payer mix and tends to be fair regardless you are senior partners or not.

Another system to form anesthesia group is that money is not pooled, fee for service is from individual patients and you receive specific payment from insurance for each case you have done. The group shares costs associated with central business office, but each anesthesiologist is financially independent. You recruit your own surgeons. If you have more surgeons than you could cover, then you keep the good cases and pass over the undesirable cases to other partners. Potentially, you only do bread and butter cases that are all insured, and you earn mega-bucks. So how much you make is not how much you work but is more dependent on payer mix. This system rewards physicians with both superior interpersonal knack and medical skill. It works like a capitalist system. If it works well, the compensation structure aligns individual incentives with business goals. But this system can be fraught with abuse potential, schedule manipulation, etc. Therefore it can be a loveless marriage of convenience between competing individuals.

There are other structural variables among anesthesia groups. For example, MD-only groups, groups hiring CRNAs, groups in different sizes, and etc.

Overall, the opportunities in private practice are really diverse. Choosing a career in private practice can be rewarding. There is no question that anesthesiologists are among the greatest beneficiaries of the fee-for-service paradigm. MD anesthesiologists achieve their current outstanding level of income solely because they are in position to provide a lot of service with very little time and resource overhead. However, there is very little certainty in the world today, especially in medicine. The future income of physicians in all specialties is up in the air, depending on what happens with healthcare reform.