The Economic State of Healthcare: Insights from Industry Experts

Navigating the economic environment of healthcare can feel daunting. However, with insight from industry experts, practices can uncover opportunities for growth and long-term stability. In a recent episode of The Happy Practice podcast, we sat down with Dr. Hendrik Lai and Genevieve Poppe to discuss the current economic state of healthcare and what it takes to thrive amid uncertainty.

Introducing Our Experts

Dr. Hendrik Lai brings extensive experience as a dentist, practice owner, private equity advisor, and global business leader. Throughout his career, he has helped doctors balance their dual roles as healers and business owners, guiding them toward sustainable growth and rewarding, resilient practices.

Genevieve Poppe, with more than 20 years in the dental industry, is a leading authority in practice management. As the founder of Poppe Practice Management and a former manager of a seven-location practice group, she offers firsthand insight into navigating the operational and financial complexities of healthcare.

Healthcare in Today’s Economic Climate

Despite broader economic volatility, healthcare remains fundamentally resilient. Demand for healthcare services continues regardless of economic conditions.

Genevieve Poppe emphasized the advantage private practices hold in uncertain times. “It’s a time to be nimble and creative,” she noted. “The ability to move quickly and make differentiations that larger groups cannot is a significant advantage.”

Addressing Today’s Economic Challenges

While healthcare remains strong, practices are not immune to economic pressures. Poppe highlighted that many households now have less discretionary income, impacting how patients prioritize care.

“Your average patient has fewer discretionary dollars to spend,” she explained. “We have to get creative in helping them proceed with necessary treatments.”

Both experts pointed to human capital development and revenue cycle management as major pain points. Dr. Lai emphasized the difficulty of finding, retaining, and integrating qualified team members, particularly as practices grow or affiliate with larger groups.

Poppe echoed this concern, noting that staffing challenges require not only recruiting the right people, but also ensuring teams are trained, supported, and aligned with core business processes.

The Resilience of Healthcare in Economic Downturns

Despite these challenges, both experts underscored that healthcare remains largely recession-resistant.

“Healthcare is a largely recession-proof industry,” Dr. Lai explained. “Population growth, increased insurance participation, and legislative changes continue to create opportunity. Industry consolidation also opens doors for both large organizations and adaptable independent practices.”

This resilience provides practices with a foundation to weather economic headwinds while positioning themselves for future growth.

Best Practices for Thriving in Healthcare

When asked what separates thriving practices from struggling ones, both experts pointed to clarity and alignment.

Poppe stressed the importance of role definition before hiring. “Too often, practices hire another person simply to help without clearly defining the role,” she said. “A strong organizational chart with role clarity is the starting point for a successful team.”

Dr. Lai expanded on the importance of strategic alignment. “There are three core strategies: cost leadership, differentiation, and focus,” he explained. “Aligning your strategy with the type of capital you deploy—whether human or technological—is essential. When strategy, tactics, and operations align, practices operate far more efficiently.”

Core Business Fundamentals That Matter Most

In times of economic uncertainty, focusing on fundamentals is critical. According to Poppe, successful practices consistently excel in three areas:

• Attracting new patients

• Converting patients to accepted treatment

• Ensuring patients pay, return, and refer their families

“Each step is simple in theory, but difficult in execution,” she noted. “Excellence in these areas is vital for long-term success.”

Dr. Lai added that clarity of vision is what ties everything together. “Practices that thrive have a clear mission, aligned strategy, and disciplined operations. That alignment guides decisions even in challenging times.”

Preparing for Practice Transitions

For many practitioners, economic uncertainty raises questions about selling or transitioning their practice. Both experts emphasized the importance of planning early.

“Do not wait until you are exhausted to sell,” Poppe advised. “Doing a few simple things well toward the end of your career can significantly increase your practice’s value.”

Dr. Lai reminded owners that buyers are ultimately purchasing cash flow. “Reducing risk through consistent cash flow and clear systems is essential,” he said. “Whether selling to a corporate group or transitioning to an associate, preparation is key.”

Addressing Staffing and Team Dynamics

Staffing remains one of the most persistent challenges in healthcare. Poppe highlighted widespread burnout and experience gaps across the industry.

“Practices that succeed have clear role definitions and alignment between strategy and operations,” she said. “Teams need to understand their responsibilities and feel supported.”

Dr. Lai reinforced the importance of alignment across vision, mission, and operations, particularly when onboarding new team members or integrating new capital into the practice.

Looking Ahead: The Future of Healthcare

Despite economic challenges, both experts remain optimistic.

“Healthcare will always be in demand,” Dr. Lai said. “As we move through this period of change, new technologies—particularly those driven by artificial intelligence—will shape the future and create long-term opportunity.”

Poppe added a final reminder: “Patient experience and human connection will always matter. Taking care of people and delivering exceptional experiences is what ultimately drives success.”