This isn't just a medical thing, it's an industry thing where small, professional endeavors take a beating. That being said, every industry has a different context in which smaller endeavors become more precarious than larger ones.
The Labor Market Has Shifted Drastically
If you've ever worked in a small doctor's office, you know what people you need available. You need a HIPAA-compliant person in charge. You need someone to check insurance. Competent receptionists are necessary. These types of positions are not entry-level positions but rather positions that experienced people hold. However, now, not only do good employees need good pay, but they also now seek positions with remote-friendly options, better salaries and better benefits.
A small dental practice cannot compete with a corporate dental chain offering everything from lower prices to additional treatment rooms for efficiency and cost reductions per customer. One small medical practice cannot compete with the salary and benefits of a hospital system. The one person in there 20 years ago who would've kept that role forever now has options that weren't static.
The Fixed Costs Remain the Same
For a small medical practice that operates on variances in patient flow or patient insurance reimbursement, the last thing they need is stagnant costs to burden them - however, that isn't how it works.
Rent will not lessen if there are two patients one month as opposed to ten in the next. Malpractice insurance premiums do not regard how much cash flow a medical practice has at the moment. Software systems subscriptions, utilities, equipment maintenance do not account for outpatient adjustments or hospital inpatient needs - they all remain the same.
For medical practices, it's even more complicated because of the compliance needs of medicine. Compliance training is as steady as change comes down the pipeline which means documentation of updates is required per any required change. Larger organizations have compliance teams; small offices have an office manager doing it all between answering phones and submitting insurance claims.
The Administrative Burden Has Grown
What those outside of healthcare might not realize is that it's not just time with the patient but the insurance pre-approval involvement paperwork that eats away at small medical practices.
Insurance pre-approval attempts that once required one phone call now require two submissions and appeals. Documentation requirements are bolstered. Patient portals have inquiries. Prior-approval denials require appeals. Everything that exists is documented.
So if a physician spends 15 minutes with a patient, they're spending another half hour documenting everything necessary to justify treatment for so long in the first place - and they aren't compensated for that time. It just has to be made up somewhere.
This is where Outsourced medical office help comes into play for many practices - offloading the minutiae that provides admin staff without requiring medical oversight helps people run an office that would otherwise need several full-time workers if hired.
The Technology Never Stops Coming
There's always new technology - but small practices take time implementing and learning new technology - and usually at great expense.
EHRs need updating. Patient portals need servicing. Now telehealth has to be ascertained. Certifications for security have to exceed expectations for HIPAA compliance. Each endeavor requires money and learning time to figure it out - and then troubleshooting takes time away from patient care. It's best to stick with that new tech which is really important to your cause, such as a PACS system, and ignore the rest. If you can do that, it will give you a much better ease of control.
Larger systems have IT departments; smaller systems have a tech-support person who has to come check in patients too.
The Economies of Scale Do Not Exist
Mainly because without economies of scale everything else comes down harder: hospitals get cheaper prices as negotiated; hospitals provide massive administrative overhead scattered across hundreds of providers; hospitals have billing/compliance/human resources/IT teams on payroll.
Small practices pay full price - and need one person (or themselves) to perform all other jobs for everyone - and those who can't make do generally fail because they rely only on themselves to make things happen.
Practices run into this acute problem every day - they require expensive equipment, specialty medicines, trained professionals - the same price points as larger hospitals - but no margins - additional positioning attracts corporate settings which suburbs are rife with because they all get buying power small practices cannot achieve.
Expectations Have Changed From Patients
Patients expect access tantamount to operating out of a much larger structure - the aesthetically-procedural avenues afford highly responsive staff and additional options like appointment reminders and paperwork - small practices want to do right by their patients but additional staffing costs render it impractical.
Client expectations run similar - small practices do not respond at lightning speed - much like corporate giants offer compartmentalized positions; small financial firms cannot have all hands on deck - except access.
What's Different Now
Pressure has always existed - but what's different now is that people are more pressure cooked than ever before.
There exists a labor crisis unlike any other in decades past, pricing has inflated higher than compensation can repay, expectations have increased from patients and clients alike; technology advanced multidisciplinary efforts across specific niches.
When compensation decreases or inflation occurs which raises hospital/corporation/HR concerns - small practices bear the burden when margins choke them minute-to-minute.
Why This Matters
Everyone thinks consolidation into larger organizations or institutions or facilities makes more sense - but it doesn't when interpersonally valuable relationships and other worldly connections come into play.
Thus, small practices need to find their gaps now more than ever and learn how to maximize efficiencies through reduced administrative burdens and efficiencies through time and pressure better than ever before otherwise they'll never come out on top again. It's no longer about working smarter than harder than it was five years ago; now it's about working on integrations that rely on details more than interpersonal interactions without learning how to make life outside work so much more complicated than ever before unnecessarily.
