Prior to 2000, a practicing physician was almost guaranteed a prosperous economic livelihood.

The guaranteed future meant that a physician could take on financial risks such as using student loans to finance their education, purchase a house during residency, and start building a family.

After becoming an attending, affording the million-dollar house, saving for retirement, financing their kids’ education, a physician could then use the remainder to afford the luxuries of life. Fifty years later, one could “retire.”

After 2000, all of that changed due to the internet, globalization, technological disruption, shifting marketplace dynamics, generational differences, managed care, and unsustainable business models. Add in “black swan” events such as 9-11, the 2008 financial crisis, and COVID-19, and it is rapidly becoming apparent that the concept of “job stability” that was highly touted as a guaranteed benefit among physicians no longer exists in the traditional sense of the word.

The current model of health care in the United States is no longer viable and is unsustainable. It is extremely expensive with outcomes that do not justify the expense. There is undue influence by parties lobbying on behalf of organizations with deep pockets that stand to lose a lot if they lose control of current paradigms (pharma, medical device, insurance, executives, legal, administration).

Adding to this predicament is that there will be a predicted physician shortage in the upcoming decade. To make up for this shortage, medical schools across the country are increasing their enrollments. Because graduate medical education is funded by Medicare, the ACGME is increasing the number of residency positions and programs at a rate significantly less than the total number of residency applicants each year. As a result of this, there are going to be more and more graduating physicians forced to pursue alternative means of income.

As we have witnessed firsthand with COVID-19, a crisis can easily overwhelm the hospitals. At the peak, hospitals were in dire need of physicians on the frontline. However, in the midst of all of this, hospitals had to lay off or furlough thousands of employees, demanding that staff risk their lives, cutting their pay, requesting volunteer staff, yet failing to provide adequate PPE, and punishing those that spoke up against the system. Even worse is that these same CEO’s, administrators, and executives were being compensated million-dollar salaries or more. This is a parasitic relationship.

Physicians have struggled and sacrificed to develop the clinical judgment and skill needed to provide competent clinical care. They have undergone over a decade of schooling and training, taken on excessive student loan debt, worked backbreaking hours for low pay during residency, and risked their lives during the process. Yet when they have completed their training, they often times have to pay excessive malpractice premiums, having to answer to bureaucrats, administrators, insurance companies, politicians, and lawyers. Many times they get the short end of the stick, and are completely expendable by the system. Their incomes are tied to a job, boss, corporate, and regulatory entities that do not have their best interests in mind. More frequently, these entities are failing physicians.

Look at what happened with COVID-19, and ask yourself, “What if that source of income was eliminated by no fault of your own?”

What is needed is a paradigm shift, and breaking out of traditional modes of linear thinking that our profession is so accustomed to. Now, more than ever, it’s not just about having a single high-income wage. Too many physicians are living paycheck-to-paycheck, have large liabilities, little-to-no savings, and families to support. Today’s physicians must be able to use asset and income diversification to mitigate economic risks.

This is the only way to guarantee against future existential financial calamities. Physicians must make plans to create their own “job stability.” Therefore, the importance of diversifying into income streams in order to achieve financial freedom and independence is now more important than ever for the physician in the era of COVID-19.

Christopher H. Loo is a physician and author of How I Quit My Lucrative Medical Career and Achieved Financial Freedom Using Real Estate.

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