If you are contemplating starting a private practice, let me be the first to say, I am truly excited for you. Having made the transition myself and having assisted other clinicians starting this journey, I can say with little reservation, it is rewarding in so many ways. As with any journey, it can feel daunting at the outset. This article is an outline of the steps to consider when starting a private practice. Use the hyperlinks within the steps for more in-depth information.
Find Your Reason and Set Your Goals
There are many wonderful reasons to start a private practice. Financial gain, setting your own schedule, flexibility, and being able to choose precisely what clients you work with are just a few. Identifying your own reasons can assist in guiding you with the decisions you make as you go through the list.
Choosing the Population You Want to Primarily Serve
The question that will act as a foundation for many other steps in setting up your private practice is this: What clients do you want to work with? The answer to this may dictate your office location, advertising plan, insurance acceptance, policies, and so much more.
Private Pay or Insurance
Being financially sustainable and profitable is essential to the survival of your private practice. As clinicians, we rarely have training in business, but we must start this process by making financial decisions. The first choice is to decide what payers to accept. Are you wanting to accept insurance or have clients pay out of pocket? If you decide you want to accept insurance payments, which insurance companies would you want to panel with?
Whether you decide to take private pay or simply need to collect copays, you will need to find a method to accept payments. There are a variety of methods, including accepting checks, cash, and credit cards.
Virtual Practice or Physical Office
With the rise of telehealth, private practice clinicians are faced with the question of the importance of having a physical office. This decision often comes down to finances and preference. Starting a virtual practice certainly comes with less financial strain, as the cost of rent is eliminated. This is enticing enough that many new practitioners choose this route to begin. Not to mention the appeal of working from home.
However, some clinicians simply prefer to meet with clients face to face or find that their chosen population prefer it. In that case, renting or subletting a space is well worth the money. One must then begin to look at availability and choose a location that is convenient, profitable, and matches the clinician’s preferred aesthetic.
Legal Formation and Taxes
Employer Identification Number (EIN)
I strongly suggest to many colleagues starting this journey to gain an EIN early in the process. An EIN acts as a Tax ID for your business, so you do not need to list your social security number. You can learn more about EINs, if you qualify, and how to apply through the IRS website.
Picking a Legal Structure
Legal structures often come down to tax benefits and liability. If you are like me and have had limited business training, words like these bring up a certain amount of discomfort. In fact, I have found that one of the largest barriers to individual clinicians feeling empowered to start their private practice surrounds liability and legal concerns. Let Ken Braslow MD teach you more about the option in his article about Proper Legal Structures.
If you have not already, it is generally recommended for counselors to hold their own liability insurance. This type of insurance can help cover legal costs if you are involved in a malpractice suit. A great way to find out what insurance provider you want to go through is by talking to other practitioners and looking at your professional affiliations’ websites for recommendations.
Electronic Health Records (EHR)
I started my private practice using word documents and an excel sheet. If I could go back in time, I would have invested some money in an intuitive electronic health record system. EHRs are often capable of streamlining so many time-consuming processes including billing, documentation, scheduling, and more. One of their most important features is that they are a HIPAA-compliant way to save your client’s private information and notes. Although EHR systems can vary in cost, Luminello currently has several discount programs. Click this link to see if you qualify.
Your practice will only be successful if people know about it. Advertising effectively is one of the keys to starting off strong as you open your practice. Fortunately, there are many avenues set up to advertise and network as providers.
Psychology Today has been one of the primary sources of referrals for me and many of my colleagues. You get out of it what you put in; therefore, it is crucial to take time to build a profile that attracts your ideal client.
LinkedIn is a social networking platform with over 300 million members from around the world. It is set up to allow for networking between professionals, displaying credentials , and gaining credibility. You can learn how to Grow Your Professional (and Referral) Network on LinkedIn.
Web Presence and Websites
Google receives 8.5 billion searches a day. It has become the primary way many people find just about anything, including mental health help. Having a web presence is important for many, if not all providers. There are different ways to create a web presence including Professional Websites, Purchased Domains, and Physician Ratings.
Policy and Procedures
Have your practice’s policies and procedures in place before your first client walks in the door. This helps set the stage for fewer misunderstandings and more consistency of care.
Your time has value, so it’s a must to create a cancellation policy that reflects that. Create a short but concise document you will share with clients that outlines what they can expect if they cancel. Often practitioners differentiate between late cancellations (given less than 24 hours before an appointment) and standard cancellations (given more than 24 hours before an appointment). However, you want to structure your cancellation policy and review it with you client early in the intake process.
Once you have started your private practice, time spent providing services is not the only call on your time. Now consideration needs to go into scheduling, voicemails, client screenings, and billing statements. Creating a schedule and system that minimizes time wasted and increases productivity has to be the goal.
It may seem early to already be thinking about burnout, but an ounce of prevention is better than a pound of cure. Integrating ways to engage in self-care and maintaining our purpose for being in the field should be central in every step of your career.
One very common complaint amongst private practice practitioners is that it can get lonely. There are steps you can take preemptively to decrease the chances of this becoming a serious concern. The very first is to network with other private practice professionals. Not only can this be a business-savvy move, but also a way to gain support from other professionals who know what it’s like to manage a business on your own while also navigating complex caseloads.