If the clinic starts offering a new service (e.g. a group of Cardiologists obtains a licence for cardiac nuclear testing), usually a Partner will be given the opportunity to take on a leadership role, such as the Medical Director. There are benefits that come in return for this added responsibility. Partners often have first choice of times and days on the schedule, priority in working with certain administration staff, and precedence in getting a better office or access to better equipment.
Similar to home ownership, there is a pride that comes from building and maintaining something tangible. If you are mentoring younger physicians, you may have the power to bring them into your office as a colleague or even as your replacement.
Financially, Partners will be entitled to more ‘gravy’ (money received with minimal effort), such as professional fees for interpreting tests that are not attached to a particular MD. There may also be profit sharing if the practice keeps a percentage of the Associates’ income or if the clinic is sold down the line.
Disadvantages of being a Partner
Heavy is the head that wears the crown. There are risks in being a Partner, especially if there was a large up-front investment; if the practice fails, you lose your hard-earned assets.
There will be additional responsibilities, with more time and effort spent on non-clinical work like managing staff, bookkeeping, dealing with lawyers and accountants, etc. Professional management can reduce this workload substantially.
If you are designated as the Medical Director (e.g. a Respirologist at a pulmonary function testing lab), you will be in charge of making sure testing and procedure protocols are being followed on a daily basis, and responsible for the periodic accreditation visits.
Advantages of being an Associate
Since Associates don’t have an ownership stake, they are not financially liable for the practice’s success or failure. This makes Associates more portable; if they want to move elsewhere or the clinic shuts down, their name is not on the lease.
There may be some advantages of being an Associate if work-life balance is a priority for you and your family; it can be more acceptable to work part-time, as compared to a Partner. You may also want to limit your exposure to the business side of the medical practice and just focus on patient care; there is a certain simplicity to getting to the office, putting your head down and working, then going home at the end of the day.
Disadvantages of being an Associate
The biggest disadvantage of the Associate role is the lack of control; you may not agree with how the clinic is being run, the staffing, the equipment, and the location, but you tend not to have a significant voice in making changes. You may also have no say in overhead expenses, which is an issue if you are responsible for paying a percentage.
No matter which path you choose, you must carefully consider all the factors involved and seek the advice of experienced professionals before making a final decision. You will want to review the financials of the practice, understand the rights and responsibilities of each Partner and Associate and comprehend the Partnership Agreement. Talking to current and former Partners and Associates can provide valuable insights into the culture and dynamics of the practice, as well as rewards and challenges. Feel free to contact us at SMP – we may be able to help with your decision.
Author: Dr. Krishna Sharma, Chief Medical Officer, Specialty Medical Partners
