Doctor Insurance Group
True Own Specialty Disability Insurance | Industry Change
May 13, 2019

True Own Specialty Disability Insurance | Industry Change

The Industry Change Effect

According to the biennial survey by the Physicians Foundation and Merritt Hawkins begun in 2012, the percentage of physicians practicing independently is diminishing rapidly. In 2012, their initial report showed that 48.5% of physicians listed themselves as independent practice owners. Fast forward to the latest survey in 2018 and the percentage decreased to 31.4%. Where are these former self-employed physicians going? Most are trending toward hospitals and large clinics, and the percentages almost perfectly contrast those of physicians leaving private practice: for 2018, a staggering 49.1% of physicians identified as either medical group or hospital employees.

Of the physicians trending away from private practice, a clear line of demarcation separates physicians in their first years of practice to those who have an established practice. Approximately 53% of physicians aged 45 and younger worked for a hospital or hospital-run organization compared to only 28.9% of physicians older than 45.

While the numbers are clear, the reasons are not. In fact, 34.6% of physicians employed by hospitals do not believe hospital employment is a step in the right direction, with many voicing the opinion that friction exists between employers and physicians, and 46.4% of those polled believe the hospital/physician relationship is somewhat or mostly negative. A report by Accenture noted 36% of physicians stated reimbursement issues caused them to close their private businesses, while an additional 23% listed overhead costs as the main concern.

With costs being one of the largest motivators, many physicians are choosing to drop their individual disability insurance policies in lieu of the inexpensive or free group insurance offered by their employers. But what seemed like a money saving option at the time can become a financial nightmare when disability insurance becomes necessary. Considering that 1 out of 4 20-year-olds will become disabled before they retire, disability insurance is a necessity.

Key Differences

Salary vs. Salary and Monetary Benefits
If your current salary is based on commissions, bonuses, retirement contributions, or other forms of income along with your base salary, the entire amount will be included on an individual disability insurance claim. With group insurance, only the base pay is considered.

Disability Coverage
Group insurance has a very narrow definition of “disability”. True Own Specialty disability insurance gives the strongest definition of disability and allows claimants to work in another capacity in their office, in another medical field, or outside medicine completely while still claiming benefits. 

Non-Transferrable vs. Transferrable Insurance:
Group insurance provided by your employer ends when you break ties with that employer. Individual disability insurance will remain constant whether you change to another hospital or decide to open your practice again.

“Own Occupation”

Group insurance will sometimes offer an “own occupation” rider to physicians that looks appealing but is more limited than many people realize. The verbiage of “own occupation” is often slightly different for group versus individual insurance plans. For group plans, “own occupation” generally allows the claimant to receive benefits if he or she is injured or disabled and the claimant has no other form of income. In individual True Own Specialty disability insurance, the claimant is free to procure another form of income in conjunction with receiving benefits, either in the same field or in another field entirely.

Premium Costs
Group insurance rates fluctuate widely. The original plan offered to new employees may change with every fiscal year, with deductibles, rules, and fees changing to meet the needs of the insurance plan. Individual disability insurance is guaranteed, meaning the rates will not change from the day you sign up for insurance until the day you retire. 

In the event you decide to transfer from private practice to a hospital-based business, your True Own Specialty disability insurance can and should remain a constant in your career. Keep in mind that insurance premiums are partly based on the age of the claimant, and the younger you are, the less expensive the costs are every month for the entirety of your career. Your best plan should include individual True Own specialty disability insurance that lasts throughout your career. Call Doctor Insurance Group at 800-997-0148 to learn more about disability insurance and how we can help protect you and your family.

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