Across the country, physicians are increasingly seeing the value of independence. Whether escaping hospital employment or breaking out of group practice to go solo, more and more doctors are heading into private practice.
If you’re fantasizing about opening up your own office, you know there’s a lot more to think about than leases, equipment, and software. It’s crucial to lay the groundwork for success from the get-go – otherwise you risk playing catch-up after your doors are already open. Tackle the following must-dos before scheduling your first patient visit.
Research & Plan
Rule #1: Don’t rush into launch mode. It’s critical to do your homework and get your ducks in a row before involving any other parties in your new venture.
Spend a significant amount of time – eight months to a year – researching your local market and analyzing the consequences your decision to go at it alone. Speak to other docs in your specialty who went private and find out what lessons they learned, or hire a consulting firm to outline the pros and cons of launching your own practice and the market forces you’ll be up against.
Craft a Business Plan
No matter how much you care about patient care, it’s vital that you treat your new practice like what it is: a startup business. How will you make money? Until you know the specifics of the answer, you won’t be able to take subsequent steps.
Walk through all of the financial considerations of operating a private practice and draft a business plan detailing them. Key points to consider include whether you will accept insurance (and if so, from which payers), whether you will handle back-office concerns in-house or outsource (which can help you maximize a profitable private practice), and whether you’ll participate in any larger healthcare system (like a franchise) or operate completely independently.
Get Legal Help
Being an employee of a medical establishment is a world apart from being the owner of one. Don’t let the confidence you’ve earned over the years working for other healthcare entities cloud your judgment of the vast legal considerations at play when launching your own practice.
Make sure up front that you won’t face legal consequences for breaking out on your own. (If you signed a non-compete, you may be in trouble.) Then, get legal assistance to help you navigate the waters of new payer and vendor contracts, malpractice concerns, and employee and contractor paperwork.
When you crafted your business plan, you should have included your startup costs – i.e., the funds you’ll need to get your doors open before generating any practice revenue. The startup costs will include equipment purchases, software licensing fees, supplies, and more… How are you going to pay for them?
Plot out the best practice management approach for financing your business, keeping in mind that if you elect to accept insurance you could be waiting as long as six months for your first reimbursements to come in. Getting a bank loan, partnering with investors, and self-funding the new practice from your own savings are a few of your options.
Prepare to Captain a Tight Ship
If you want to run a successful practice in the long-term, it’s important to set the stage for profitability from the start. As you recruit new employees and contract with new partners, set measurable performance expectations and guidelines. Be sure you prioritize billing and collections just as much as patient care; without a well-run back office, you won’t stay afloat.
Hold yourself accountable, as well. Like any entrepreneur, an independent physician is the face, heart, and soul of his business. Push yourself to provide the best care to as many patients as possible. Hopefully, that will keep them coming back.
...and if you need help with your practice revenue...