"I'm Building A Successful Solo Practice"
A young eye surgeon discusses his decision to go it alone -- and how he's making it work.
BY GREGG FEINERMAN, M.D., F.A.C.S.

After finishing my ophthalmology training at the University of California at Irvine, I accepted a refractive surgery fellowship at the internationally known Gimbel Eye Center in Calgary, Alberta, Canada, with Howard Gimbel, M.D.

Going out of the country for my fellowship training allowed me to obtain a great deal of experience in refractive procedures that were not yet approved in the United States.

Though I didn't know then that I would be entering solo practice within a few years, I was a keen observer during my fellowship. I wanted to learn about every aspect of the practice, not just the procedures. When I wasn't busy in surgery or clinic, I met with other people in the practice. I spoke with members of every department -- marketing staff, technicians, and even accounting personnel. To develop a plan that would help me build a practice of my own someday, I wanted to know how the organization worked.

Looking to the Future

And while I joined a group practice when I completed my fellowship, I did see the strong possibility of going into solo practice at some point in the future. There's a myth that a young ophthalmologist can't be successful unless he or she joins a busy group practice. That's not true. A good surgeon can become successful in solo practice with sound practice management advice.

To be a successful business owner, you also need to have certain personality traits. While many physicians may view a group practice setting as a "safe" way to fulfill their medical career, a solo practice offers rewards that a group setting can't provide. In addition to the financial opportunities a solo practitioner is free to explore, going it alone offers a surgeon the ability to retain total control over both medical and business decisions. A solo practitioner can also decide how much time he wants to devote to work and how much time he wants to give to his family and other interests.

In this article, I'll explore the decisions, choices and personal attributes that have enabled me, a young ophthalmologist with family responsibilities, to become a successful solo practitioner. (For more information on starting your own practice, see "Action Plan for Residents," Ophthalmology Management, February 2003.

Gaining Experience

I'm an extrovert. I like people. I knew I had the personality to be successful in most practice settings, including solo practice. I saw my fellowship year as an opportunity to blend professional experience with business exposure. I tried to gain insights into the business of medicine, to see the whole picture. I didn't base my fellowship on getting a job. I knew LASIK was going to be a popular procedure and felt comfortable that I would be able to land a good job somewhere.

As my fellowship drew to a close, and given the state of the refractive market in 1998, I had two definite practice opportunities. One was to go the corporate route with the laser vision correction chain TLC Vision, while the other was to join an established group of three surgeons in Long Beach, Calif. I chose the group practice, not even considering solo practice as an option at that time. Operating out of a new laser center financed by the group, I practiced a little more than 3 years in the group setting before the conditions that would spur me to go it alone came about. At the time I joined the group practice, LASIK was booming. Everyone made a lot of money for awhile, but then the LASIK market went into a steep decline and a number of business-related issues arose that focused my attention on going solo.

Making A Big Decision

Perhaps the biggest issue was autonomy.

I have confidence in my abilities. I generally prefer to make my own decisions. I also wanted more autonomy. Thus, I felt it was time to take control of my professional life. Combined with some buy-in/ownership issues with the group, I decided going solo was the right course of action for me. I knew going out on my own wasn't going to be easy. Conducting your own practice requires capital, a patient base, and support of referring physicians.

The first decision I confronted was whether to start a solo practice from scratch or to look for an existing practice to purchase. I already knew where I wanted to practice -- in sunny Southern California.

To me, starting a new practice from scratch wasn't a great idea. It can be very difficult. You have to be able to account for so many things financially. You need money to tide you over until you become established. Buying an existing practice, one that combined a solid patient base with growth potential, made the most sense to me. It's the option I feel most comfortable in discussing.

When I began my search for a practice, I bypassed the "practice for sale" advertisements in medical publications and turned to the Internet to conduct my research for likely prospects.

I first pinpointed likely locations and researched the physician owners. My strategy was to find practices in healthy financial environments that were owned by physicians nearing retirement age.

Finding a practice that can be bought, even though it's not officially for sale, is really not that difficult. I made a few phone calls and asked the practice owners if they had a retirement plan, an exit strategy, and if they might be interested in selling. I handled these conversations diplomatically and found several owners who were receptive to my inquiry.

I then conducted additional research on the practices I thought might be possible purchases and eventually narrowed my prospects to a manageable handful. I further refined my short list based on a variety of business factors, including practice location, patient base, growth potential, equipment replacement, remodeling requirements, cash flow and price.

This Is It

I eventually zeroed in on a practice located in Newport Beach, an upscale community in the heart of California's active beach scene. It turned out to be a practice owned by a physician I knew through my residency.

My initial research produced a good feeling about the practice. I went with my gut feeling at this point. I liked what I saw and heard. I'm a firm believer that you'll know what looks right . . . what looks good. Everything seemed to point to this practice.

At this stage, I wisely enlisted the help of a practice valuation expert from a well-known consulting firm with vast experience in the eyecare arena. The goal was to examine the practice's current financial information, determine future growth potential, and arrive at a realistic purchase price agreeable to all parties.

I may have been excited about the potential of this practice, but I realized the importance of outside, independent advisers who could analyze the numbers and facts. Purchasing a practice isn't something you can realistically do completely on your own. You can -- and should -- make the preliminary decisions such as where you want to locate and which services you want to offer patients, but there definitely comes a time when you need a team of advisers.

The result of the valuation process was that we had identified a seemingly undervalued practice with tremendous growth potential. The practice contained a wealth of charts with pathology. In my mind, the deal was a "go." It was time to secure financing.

	PHOTOGRAPHY: GEOFF BRIGHTLING

Obtaining Financing

The bank was primarily interested in my business plan. They didn't spend much time scrutinizing the practice itself, but they did go over my business plan in detail. Fortunately, I had an extensive, detailed plan that exceeded even their expectations. Combined with an excellent credit report, getting the financing to take on this project was relatively painless.

In November 2001, I finalized the purchase. But I closed the office briefly the next month to spend about $100,000 to remodel the facility and upgrade equipment. By adding digital retinal photography, wavefront topography and the GDx nerve fiber layer analysis system, I was quickly able to expand the range of procedures the practice would be capable of performing.

One of my top priorities was to upgrade the office to make patients more comfortable and improve patient flow. This enabled us to operate more efficiently and also resulted in more word-of-mouth referrals. I also moved the optical boutique to the front of the office so patients could browse through our selection while waiting, and upgraded to higher quality eyewear that would appeal to trendy Southern Californians. These changes resulted in sharp growth in our optical sales.

And adding my expertise in refractive surgery to the Newport Beach practice almost immediately increased our practice revenue by approximately $30,000 a month.

I made sure to handle the transition period cautiously, working half time at my old practice for 6 months and the other half at the new practice. During the transition period, I took the initiative to increase physician and optometrist referrals by sending out letters introducing myself to all potential referrers and having lunch with many of them. I also gave seminars to local doctors and the public, and hired a public relations representative to obtain media exposure. And I negotiated the services of the retiring physician to assist with the transition.

Having the retiring physician on board was critical to the success of the whole process. He was able to exit gracefully and, at the same time, introduce and position me with his/my patients. The long-time patients were, of course, unhappy to see him go, but almost all of them seemed happy to meet me and, most importantly, to continue being patients.

My patient mix is now approximately 25% refractive, 40% cataract, 25% glaucoma and 10% general eye exams. I recently was able to hire another ophthalmologist on a part-time basis to perform eye exams and treat some nonsurgical patients.

I've been completely on my own since mid-2002. We were able to increase patient count by more than 50% in the first 7 months after taking over the practice and I look forward to continuing 10% a year growth in patients seen. We've also been able to dramatically increase the practice's overall revenue and profitability, far exceeding the initial projections we made when I decided to buy the practice.

I can say honestly that I enjoy the solo life.

I love running my own practice. I like making the decisions that affect my professional career and my life. I wouldn't have it any other way.

Tips for Success

Since establishing my Newport Beach practice -- Feinerman Vision Center -- it seems as if my reputation has grown. I'm now established as an experienced refractive surgeon and have written about refractive surgery in peer-reviewed journals and authored books on the subject.

If you desire to become a solo practitioner in today's challenging eyecare environment, please consider the following nuggets of advice, drawn from my personal experience:

Know yourself. Are you a solo person or a group person? Do you defer to others in a group situation or do you prefer to have more control? In a solo practice, you can have advisors, but you'll be the person who's ultimately responsible for making the key decisions that will determine the future of the practice.

Hire trusted advisers. Going solo doesn't mean doing everything alone, especially if you're purchasing an existing practice. Choose experienced experts for your team. Make sure to include individuals knowledgeable in business plans, practice valuation and contracts.

Limit your purchase candidates. Know what you're looking for in a practice and narrow your choice to two or three top prospects. Once that's done, bring in your advisers to help you with valuation, contractual and budgeting issues.

Don't put all your eggs in one basket. Stay in your current position until you're certain the solo option is going to materialize. If you can't complete a deal on the practice you like the best, have another attractive option you can turn to enthusiastically.

Do your homework. Dispassionately evaluate the practice from both a business and marketing perspective. What's the practice worth? Is it in a good location to draw patients? Does it have growth potential? Does it have a sound patient base? Will you need to remodel and/or replace equipment? Will key staff stay with you? Do you really want the current staff to stay?

Trust your instincts. As you research potential practice purchase opportunities, you'll get a feeling for which practices are most appealing, based on your needs and goals. If your research and observation give you an especially good feeling about a specific practice, put it high on your list of possible choices.

Assess the location. The adage that location is critical to business success is true in eye care, especially if you specialize in retail-type procedures. You want to be in a financially healthy environment where the majority of the residents have private insurance.

Develop a business plan. Having a detailed business plan will put you on the path for success, and can play a major role in securing the financing you'll need. Although the initial business plan will change some, it should paint a fairly accurate picture of what you're going to actually do with the practice over the first 2 or 3 years.

Talk to those who've "been there." Seek out colleagues and others who've had real-world practice management success. Going solo requires excellent practice management and general business skills. Look for people who've been successful running an eyecare "business" and ask them to let you pick their brains.

Use the Internet. Once you've selected a general geographic location, the Internet can be a valuable tool in identifying practices that might be for sale. Try to determine who might be retiring in the not-too-distant future. Diplomatically ask those physicians if they have an exit strategy or retirement plan, and tell them you're interested should they want to discuss options in greater detail. Your show of interest may plant a seed in their minds.

Keep a good credit rating. Lenders will want to look at your business plan and your credit rating. Take the time to research your credit record with the major credit-reporting agencies and make sure it's accurate.

Plan the transition period. Having the retiring physician stay with the practice for a pre-determined transition period is critical to the successful purchase of a solo practice. This provides an opportunity for the exiting physician to depart gracefully and for you to be properly introduced and positioned with existing patients.

Get on staff at the local hospital. Apply for hospital privileges several months in advance. You don't want any lag time between when you take over a practice and when you can perform procedures in a hospital setting.

Keep key office staff. Retaining the key players on staff (if they're good workers) will be extremely helpful for both the patients' transition and yours.

It's Tough, but Rewarding

Any decision to become a solo practitioner in today's difficult environment must be made with much planning and care. If you decide to explore this practice option, you must have a real understating of your own personality and goals. You'll also need to develop keen practice management skills, and be willing to take the advice of expert advisers who may at times challenge your own assumptions. While practicing medicine in a solo setting will never be easy and sometimes be risky, it can be a highly rewarding career for the right physician when the right opportunity arises.