Ophthalmology Business

DEC 2012

Ophthalmology Business is focused on business topics relevant to the entrepreneurial ophthalmologist. It offers editorial, opinion, and practical tips for physicians running an ophthalmic practice. It is a companion publication of EyeWorld.

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continued from page 17 drawn back into another practice, Vermont Facial Aesthetics (Norwich, Vt.). "The hardest thing for me was selling the practice; I sold it five different times before the paperwork was actually signed," she said. "I felt I had a responsibility to my patients to leave them in good hands (all puns intended)." Overall, it took her 2 full years to sell the practice, all the while commuting back and forth from Vermont and practicing in both places. "I needed to keep working in Massachusetts while living in Vermont or I'd have had nothing to sell," she said. "As a solo practitioner, all you're really selling is your good will, reputation for great care, and some used equipment when you sell your practice. And then you worry about the staff who made you so successful—will they stay when someone new comes on board? Or will the new person want cheaper staff or his own crew?" Different options At Minnesota Eye Consultants, all the physician owners partake in a "major retreat every year, and we meet for 3-4 hours every month" to discuss practice business, Dr. Lindstrom said. By the time he's prepared to fully retire in about 10 years, his personal share of the practice will be 10%, which the remaining nine owners can buy out, or have a tenth physician-owner buy in ... and so on, and so on to continue ensuring a high quality practice remains in the area, he said. His business model offers "the best of the best," Dr. Lindstrom said. "It was the wisest decision I ever made—I actively recruit people who are better than I am. My patients know they're being left in good hands, and I'm not worried because the quality of care is so great." 18 Surgeons need time to grow into ownership roles, he said, and in his practice's case, it's 10 years, but at that point the surgeon is a full owner. Dr. Kim's practice had a much smaller evaluation/assessment period of only a year. "If everyone agrees at the end of that year, the doctor buys into an equal share immediately. We took the value of the practice and I bought into it for one-third," Dr. Kim said. "The benefit of a quick buy-in period is that as soon as I bought in, I had equal access to profits and to our optical ambulatory surgical center. I think that's the key with buy-ins. A lot of M.D.-owned practices have much longer wait times—physicians will set down roots after 2 or 3 years but have nothing to show for it, and for me, that wasn't advantageous." Plus, if a physician decides the fit isn't right or the practice decides for the physician the fit isn't right, the physician has to "start from scratch someplace new," he added. Solo practitioners need to decide if they want to relinquish some of the control, Dr. Price said. Dr. Boerner agreed—going from being solely responsible for every decision to sharing that responsibility means swallowing some ego, and that may not be easy for some surgeons. Preparing for … ? Dr. Lindstrom's advice to those who are not yet nearing retirement? "Plan at least 10 years ahead. If you have a valuable practice, you have to recruit really talented people and give them a better deal than you might want," he said. "Take at least a decade to fully implement your plan and talk with your mentors, your consultants, anyone else whose business acumen you value." Ophthalmology Business • December 2012 Dr. Boerner concurs, noting in retrospect she should have planned for her first retirement sooner. "Einstein's Theory of Relativity needs another corollary—some explanation for the elasticity of time you'll notice the moment you wake up with nowhere to go," she said. "Things seem to take longer during 'retirement' … maybe because you've slowed and no longer have to rush from place to place. It was both scary and intoxicating." For surgeons who did not ease into retirement, she recommended scheduling one thing every day. "At 61 years old, I ended up going back to school and opening a new practice because I couldn't stand not having somewhere to go every day," she said. "This time around, I'm actively thinking about who I'd like to take over the practice." Dr. Price predicts he'll be able to transition out of active practice by increasing the amount of time he can devote to his research before completely retiring. "When you're in solo practice, you have the freedom to decide on what products you want in your office, what the surgical schedule is, who to hire," he said. "There are no conflicts, but there's the issue of cash flow when you're the only one supporting everyone's salaries." Dr. Lindstrom agreed, noting each practice needs to determine what its dynamic will be in the upcoming years as owners gear up for retirement. "You have to know what you want to do and what you want to be as you head into retirement," he said. OB Contact information Boerner: carol.f.boerner@gmail.com Kim: kim@professionaleye.com Lindstrom: rllindstrom@mneye.com Price: francisprice@pricevisiongroup.net

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