Physician partnerships are hard, but conflicts are avoidable

Partnerships in any industry are challenging. It’s impossible for all parties to agree on everything, and compromise can be difficult. It’s just human nature.

Physician partnerships are no different. From finances to strategy, decisions must be made constantly, and each one presents opportunities for conflict.  However, there are ways to reduce tension and promote a harmonious partnership.  Here are four approaches that can help.

Share responsibilities

Many partnerships consist of one partner who leads the practice. The other physicians may have appointed this leader because the articles of incorporation require them to pick someone or because that physician seems best suited to leading the business.

Subsequently, this leader becomes the administrator responsible for daily practice issues. But often this leaves them holding the bag while other partners focus on issues that affect only them — not the practice as a whole. Elect a strong leader and pay a monthly compensation for handling administrative and management matters.

In many practices, physicians often downplay the importance of leadership instead of emphasizing it. Define partners’ job responsibilities so they all share authoritative duties and accountability.  And make sure they are compensated for the hard work, extra hours and positive outcomes they contribute by taking on these responsibilities.

Establish a vision

One key to a thriving practice is establishing a practice vision — its purpose, expectations, concerns and goals. Whether starting a new venture, adding new partners or implementing strategic changes, your partners must mutually maintain this vision. Of course there will be challenges, such as adding new services or procedures. Moreover, the practice will likely encounter certain issues if it opens up a new office or hires additional staff physicians.

Such operational changes can alter your practice’s vision and create significant problems. It is unreasonable to expect all the partners to always agree. Instead, allow each the opportunity to express his or her viewpoint. After all, rational, professional debate is healthy as long as it doesn’t deteriorate into heated arguments. Keep it civil and focus on the best course for the practice as a whole.

Work through financials

Partners’ stress levels can spike when reimbursements don’t keep pace with operating-cost increases. A need to decrease partner bonuses can add even more fuel to the fire. Financial disagreements can blow up into major conflicts quickly.

For example, ill will can occur when one partner isn’t as involved in financial decisions as others. Similarly, many practices struggle with partners who fail to produce results commensurate with their salaries. “Dr. so-and-so makes as much money as me but I’m working way harder,” is a familiar sentiment.

To mitigate these issues, implement a clear, fair and amenable compensation model for physician partners. At minimum, each partner must generate enough revenue, less expenses, to cover his or her salary. Also, annually set partners’ goals as well as review their performances and compensation.

Commit to each other and seek help when needed

The success of any business depends on the partners’ commitment to each other — through good times and bad times. So, save the boxing gloves for slugging it out with the many outside forces pummeling physician practices these days, and put on the kid gloves for dealing with partnership issues.

Also, let your financial advisors serve as your ringside coaches for working out differences among your partners — before it’s too late. Experienced and objective guidance from advisors whom all of the partners trust can reduce tension and help all parties see a clear path out of whatever difficulties the practice faces.

The Healthcare Team at Sol Schwartz & Associates is ready to help.  Contact Jim Rice, CPA, or Christopher Davis, CPA, at 210.384.8000.  Or email them as follows: Jim Rice –, or Christopher Davis –