Location, Location, Location!

Step one: figure out where to open your practice.  First of all, I’m single, have no children, and am not tied down to any particular area.  Most people told me that I should practice wherever I want to live.  Of course, it’s not that simple.  Generally, more people want to live in Los Angeles, Chicago, or New York than Boise, Omaha, or Anchorage.  I’m no exception.  As such, the competition, cost of living, and compensation is more challenging in these “desirable” areas.  Yet, you still shouldn’t completely close your doors on these areas.  It’s still worth looking into the feasibility of these “saturated” markets.

My main geographic requirement was to live in an area with a large Korean-American population.  These areas tend to be in competitive locales, including Los Angeles/Southern California, San Francisco Bay Area, Chicago, New York, Atlanta, Philadelphia, Dallas, or Houston.  I first performed an extensive Google search to find out the current Korean-American population and 10 year growth rate, and compared it to the growth rate of the general population in each area.

I used the 2000 U.S. census data, the American Community Survey (also on the census website), www.city-data.com, and some other random Google searches for my population analysis.

The general rule of thumb is that you need 20,000 people to support one anterior segment ophthalmologist.  I’ve also heard that each retina specialist needs close to 100,000 people.  For highly saturated markets, with a large optometric representation, you will need closer to 35,000.  If you’re the only ophthalmologist within 100 miles, you will obviously need less.  Depending on the population density, this “target” population quota might be met within a 2 mile radius or might need to span 300 miles.

You also have to consider the niche population that you might be able to target.  Even if there were 50 ophthalmologists in an area with 100,000 people, if you’re the only glaucoma specialist in town, you will flourish.  If you’re the only one who speaks Vietnamese in a town with 40,000 Vietnamese-Americans, you will also do fine.

In order to pick the location that will give you the best chance of success, detailed population analysis and subanalysis is key.  Other factors you need to consider are the age distribution, median income, health insurance structure, and insurance reimbursement trends of the area.

In addition to the patient population, you also need to research the demographics and characteristics of the ophthalmologists in your area of interest as well.  First thing you want to know is how many active ophthalmologists exist within a given radius.  I used the AAO directory to find this information.  I also used www.vitals.com, www.healthgrades.com, and the Yellow Pages to verify my numbers.  I made sure to exclude retired ophthalmologist from the count.  I also excluded retina, refractive only, and non-cataract specialists, since the main focus of my practice will be cataract surgery.

If you discover that the location you are scoping out appears saturated, don’t despair quite yet!  Another factor you need to take into consideration is the age of these ophthalmologists.  Find out when each ophthalmologist graduated from residency.  Some will be retiring in the next few years, and they may not be as much of a threat.  In addition, older ophthalmologists sometimes no longer take new patients.  Also, once an ophthalmologist retires, nearly 50% of the patients will seek care elsewhere, even if the practice gets sold to another ophthalmologist.  Lastly, as a younger ophthalmologist, you will be offering more modern service, with the latest technology, clinical knowledge, and surgical techniques, compared to these seasoned veterans.  You will learn that a good number of community private practice ophthalmologists practice outdated medicine because they have failed to keep up with the technology and medicine.

The other thing that I looked for was the ratio of group practices to solo practices.  Even if there are less than 20,000 people per ophthalmologist, if 90% of the ophthalmologists belong to 5 mega group practices that market heavily in the community and have an endless budget, your solo practice will face an uphill battle.  On the other hand, if 90% of practicing ophthalmologists are in small 1 to 3 physician practices, it’s going to be a lot easier to take them on because they have more limited resources.  You’re also more likely to find yourself being able to offer a unique service that other small practices don’t.

Also, keep in mind of any exclusive hospital networks like Kaiser.  The patients in these groups will be hands off to you, but the physicians in these groups won’t be competition to you either.  Nevertheless, you still need to factor in this element when doing your population analysis because your potential patient pool will be reduced.

I also looked up the number and type of ophthalmologists on staff at the hospitals I considered applying for privileges.  Most patients like to stay within their hospital network for all their care, and do not like to drive more than 2 miles to see their doctor.  Hence, your patient draw will be mainly from those that live near or frequent your affiliated hospital.  If you see 20 ophthalmologists on staff at one hospital, and 2 in another despite similar population densities, you just found the hospital you need to join.  Of course, you have to find out why there are only 2 ophthalmologists in that hospital.  Is the hospital closing down?  Is it haunted?  Whatever.

Last thing I researched was the number of optometrists and primary care physicians in the area.  These professionals will become your referral sources, and you want to make sure that there are plenty of them nearby for you to knock on their doors and to shake their hands.  Also, consider finding out how many nursing homes or retirement communities there are in the area as well.

There are countless other factors that come into play when choosing a location.  These were the main ones that I thought were important, and they definitely helped me to narrow down my potential practice locations.

Next time, I will talk out how my population analysis lead me to choosing San Jose, CA, one of the most saturated areas in not only the country, but also in the Bay Area.

5 thoughts on “Location, Location, Location!

  1. I think I have found a great niche location to open a practice. One of my questions is how do I establish a place to operate? I can’t seem to find any info about how to get some OR space somewhere, and how surgical equipment works with ASCs.


    • Use google to find the ASCs in your area and speak with the administrators to go on a tour to see what equipment they have, and if this suits your needs. Find out if they are willing to buy any equipment you need (this usually isn’t any problem for cataract surgeons unless perhaps with ora or femto if you want it, but retina and oculoplastics may be different).

      Credentialing with ASCs occurs after you sign your lease and get office address but start early. Try to make sure you get block time.


  2. Hi! How did you find out how many ophthos are needed per population? I think you calculated that 20,000 were needed to support one anterior segment ophtho. I am a gastro, thinking of going solo. I would love to pick your brain because it would be in the San Jose area.


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