Healthcare Has Yet to Feel Full Impact of Physician Retirements

Healthcare organizations need to prepare for a wave of physician retirements, according to a new survey from the physician, physician leader, and advanced practice provider recruitment firm Jackson Physician Search.

The firm polled nearly 400 physicians and 60 healthcare administrators to understand their views on physician retirement and readiness. The survey showed that 62 percent of physicians have not changed their retirement plans because of the economy, including recent inflation, stock market volatility, and recession fears.

Additionally, of the physicians delaying retirement because of the economy, most plan (27 percent) to postpone retirement by one to four years.

COVID-19 is also still a factor when it comes to physician retirement. In a 2021 survey, more than half of physicians said the virus had changed their employment plans, with one in five of those respondents seriously considering early retirement. Of the 24 percent of physicians in this year’s survey who plan to retire early because of COVID-19, the majority (60 percent) still expect to do so.

Overall, the findings indicate that most physicians will retire as soon as they are financially able, meaning healthcare organizations are slated to lose key members of their workforce in the near future. Almost half of practicing physicians were already over the age of 55 in 2021, according to a 2022 report from the Association of American Medical Colleges (AAMC).

“It all comes down to the question of when – not if – the healthcare industry will feel the full impact of forthcoming physician retirements,” Tony Stajduhar, president of Jackson Physician Search, said in a statement.

Healthcare organizations need to have a plan to withstand physician retirements, according to Stajduhar. That means recruiting and retaining physicians differently than they have done so in the past.

Physicians indicated in the survey that offering part-time work and flexible schedules would delay their retirement plans. Many physicians also cited reducing or eliminating on-call requirements as a factor in their retirement plans.

However, younger physicians placed more importance on retention bonuses, while older physicians were more likely to delay retirement for teaching and mentoring opportunities.

Addressing physician burnout should be a key pillar in physician recruitment and retention strategies, the survey shows. General burnout or being overworked was the top factor (24 percent of physicians) driving their retirement decisions for physicians, leading lifestyle (23 percent), achieving financial stability (22 percent), and age (12 percent).

Only 11 percent of healthcare administrators, however, said burnout was the most important reason they see driving physician retirement decisions. Most administrators felt age was more important, as well as lifestyle.

Physicians and healthcare administrators also do not align on transition plans. Most physicians (41 percent) said notice of three months or less is enough, while healthcare administrators preferred one to three years.

The survey also showed that 69 percent of administrators say their organization doesn’t have a formal, written succession plan.

“When you consider that recruiting a culturally aligned physician in today’s competitive market often requires 6-12+ months and costs $250,000 or more – including sourcing, relocation and sign-on bonus – greater emphasis on initiating the retirement discussion, as well as accommodating physicians’ desire to slowly transition from full-time work to retirement, is key to keeping them in the workforce longer,” said Stajduhar.