After all of the time and money you’ve invested in getting your degree, are you truly prepared to open up your own practice? Or maybe you’re at that stage when you’re ready to stop being a junior employee of a large group practice and head out on your own.
Either way, one thing is true — failure to plan and prepare can be a barrier to achieving the success and career freedom you’ve dreamed about.
As a new business owner, establishing the right foundation for that success is your most-critical role…one that may be a new “hat” for you. But as it’s been said before — attributed to everyone from Moses to French philosopher Voltaire and, more recently, Uncle Ben to Peter Parker in Spider-Man comics and movies — “With great power comes great responsibility.”
When you were an employee, you may not have liked the way things were run, but you had little power to do much about it. Now you can. It’s your responsibility as the owner and the ultimate manager of your new employees to meticulously plan and execute the right infrastructure that will empower them to thrive as the practice launches and grows. If you don’t, your dream practice could become a nightmare that fails painfully.
There are some strategic essential steps you can take as you learn what might be a whole new set of business skills and establish yourself and your team to meet or exceed your goals as you serve your patients well. Following are just a few major ones, to get you started.
1. Build a bench of strategic experts
It can all seem overwhelming. But remember that you don’t have to do it alone. You need to fill your roster of expert advisors and resources who will help you on the necessary legal, financial, administrative and other steps so essential to launching your new practice.
This will include lawyers and financial gurus to help you choose and establish your business structure — a sole proprietorship, professional limited liability company (PLLC), S-Corp or another. You can easily apply for your EIN (employer identification number) from the IRS online, ensure your licensure is up to date, purchase professional liability insurance coverage, and set up a business bank account and credit card. Your attorney also can help you understand all of the ramifications of HIPAA, the Health Insurance Portability and Accountability Act of 1996 in the U.S., or in Canada, PIPEDA, the Personal Protection and Electronic Documents Act, and PHIPA (the Personal Health Information Protection Act) in the province of Ontario. (For this blog, we’ll assume that most of you are setting up practice in the U.S.)
2. Research the market
Research your area to determine who should be your target market of patients (by condition, age, insurance coverage, etc.), what gaps in clinical services you could fill, and from where you should provide those services…a location that’s underserved by current competitors, good for traffic flow, visibility and parking. Before that, evaluate your competitors: their size, structure, locations, services and length of time in business.
Armed with all of that, you can even survey prospective patients directly, asking them what it would take for them to choose your clinic and even a location that would best serve them. What can your new practice deliver that’s different, or better than what existing clinics provide?
3. Choose your sweet spot
Based on your research, determine what — or how — in your broad specialty can you bring to the table something your target area’s competition cannot…or at least does not…do well. What part of your specialty do you intend to focus on — general practice starts out as very broad, infectious disease, pediatrics, geriatrics, sports or workplace injuries, post-surgical rehabilitation, chronic pain or others? This will also help you determine your needs for office space, staff and equipment to build into your business plan.
And exactly how can you differentiate…not just with what services you focus on, where and for whom, but exactly how will you deliver them? More on this in a bit, but remember that most of today’s patients have evolved into true healthcare consumers, who want convenience and easy methods of communication with your practice. That may be one of the very-important ways that you can differentiate the patient experience from older practices that might not have kept up with the consumer movement and the tools that make it possible.
The pandemic in particular has gotten most people more comfortable with spending more time online for communication and purchases. Don’t presume that Grandma won’t like to do some things like appointment scheduling online; after all, she’s been ordering stuff from Amazon.com and other sites for some time. Plus she has probably become very comfortable communicating with family and friends on Zoom or FaceTime. These times, where in-person contact has either been unsafe or just less convenient, have in many ways transformed our expectations of how to interact with each other…including with our healthcare providers. Who wants to drive through gridlocked traffic to get to and from a 20-minute office visit, if telehealth, an online chat or completing a form online can save the trip?
4. Build your business structure and plan
Are you going to be a solo practitioner, at least initially, or do you want to align with other partners? Either way, you’ll need some staff and support tools, and legally establish your practice. As noted above, you need to determine what kind of legal entity you want to be…and what resources you’ll need to get where you can open your doors
Perhaps after doing even these first few steps, you decide you’re willing to enter into an affiliation with a local hospital or health system. Regardless, you’ll need to decide what other staff or service resources that you need, and plan accordingly. (And with your lawyer, make sure you read the fine print on all agreements before you sign! A verbal agreement is, as they say, only worth the paper it’s printed on.)
5. Compensation: How (and how much) you’ll get paid
Will your practice be insurance-based or solely cash-based or insurance-based? If the former, ensure that you or a trusted associate research the terms of the insurance contract with each provider. Also, will your office manager handle billing, or will you use a third-party service? There are pros and cons to each option, so do your homework to determine costs and the value proposition of each.
6. Build a marketing plan
You’ll need to build at least a high-level marketing plan to present to your potential start-up investors to demonstrate that you’ve thought this all through.
Leveraging all of your initial market research, choose a business name and a logo you can use for your financial presentations. (Once you lock down your financials and legal name and logo design, business cards and other materials can follow.) As with other critical start-up issues, involve your lawyer and/or a marketing firm that specializes in choosing one or more trademark-available and pertinent brand names in the U.S. or Canada…preferably both, to avoid any potential trademark infringement issues that may arise later. There’s nothing more expensive (and mortifying) than to launch a new practice, name and logo and then pay the expenses and threat of a lawsuit over trademark infringement…and having to re-brand. Signage and all other marketing materials cost a lot of money!
Map out a marketing strategy that includes a strong digital presence, including a website, social media, a way to facilitate positive patient online reviews, a patient portal, two-way texting and a blog that provides an educational service (while subtly driving your marketing messaging and differentiators, as well as business) as you demonstrate that you’re a modern, up-to-date provider keeping abreast of topics important to your target audience.
Print materials such as brochures and particularly mailed postcards are expensive and are less valuable to use as marketing tools these days, yet targeting a mailer(s) to specific ZIP codes may be of value as you first launch a new practice with an unknown brand name.
7. Secure financing
Once your business plan and marketing “pitch” are in place, you can secure loans or investments from banks, angel investors, or even family members and friends. Other options include borrowing money against your personal retirement accounts or taking out a second mortgage. Just be careful not to get in too deep financially; remember those school loans and other expenses you’re probably still paying for!
You’ll need to show the investment in tools and services you’ve determined are necessary to run an efficient, effective practice. These can make a huge impact on the way you run your business every day, and how you’ll be poised to launch and grow.
Among other things, those investments should include how you will do patient intake and other communications, from medical histories, to insurance forms, HIPAA disclosures and more. Choose an online intake forms service provider such as intakeQ™, one that also delivers a comprehensive, integrated practice-management solution that has automated workflows and appointment-booking, a patient portal and more. The fewer providers you need to help you deliver all of this important communications and management foundation, the better!
8. Finalize your location
You probably already toured potential office locations before your financing pitches, to demonstrate your preparedness. (The Boy Scouts were right; be prepared!) Once the startup money is available, it’s time to lock down a space. This could be your first professional “home,” so it’s an exciting step! Remember that on top of the consideration of current space needs, some potential for growth, traffic, parking, etc., your start-up plan must include costs (and time) for any renovations, signage…all of that and more.
9. Recruit and hire staff
Before your confidential financing discussions, you’ve probably already quietly talked to some proven associates you’d like to join your team. Once you have the funding go-ahead, hire them if they’re still available, and have them — particularly an office manager — help you recruit the others. Spread the word to your former classmates and current colleagues who are exceptional in what they do…with connections to who and what you need. Gauge their interest in joining your practice and ask them for referrals.
Of course, even if you know them personally, properly vet candidates through an extensive interview process, drug and background checks, etc. Here your new office manager can help…someone who is both extremely competent and friendly as the face of your practice, as well as a good judge of character. Strongly consider hiring allied health professionals, front-desk and other staff from different cultures and racial/ethnic backgrounds as a way to promote diversity in healthcare and increase relatability with a patient base that’s likely to be diverse themselves.
10. Design your dream space
A professional architect and designer will help you maximize your square footage while capturing the vision of your clinic. Plan the floor layout for a positive environment, an efficient workflow and confidentiality of patients’ protected health information (PHI)…and privacy in general. Consider your color scheme, taking into consideration a complementary scheme to your logo/brand colors, and whether or not artwork should relate to your services. Regardless, your location must reinforce your brand identity while having a positive, calming effect on those healthcare consumers visiting your practice.
11. Buy equipment
With your new office manager to help you make it happen, think through all of the equipment you’ll need to enable your smooth-running new practice — X-ray and ultrasound machines, adjustable exam and treatment tables, physical and occupational therapy equipment, and much more. Of course, you’ll also need information-technology purchases, from networks, staff computers and printers, as well as furnishings for both patients and staff that are attractive and ergonomic.
12. Choose the right software
Whether it’s provided on-site or through the more-popular software as a service (SaaS) model, you need information technology (IT) solutions that enable all operations to flow seamlessly, from both the patients’ and staff’s perspectives. This includes a practice management system (billing, payment, scheduling and accounting), an electronic health record (EHR) of some type, a patient portal, and patient communications options that provide your convenience-focused patients with choices as to how they interact with your practice.
Remember that how you engage with your patients and keep them happy — giving you glowing online reviews that will help you attract more new patients — can be your essential differentiator from more-established practices that haven’t invested in these modern tools.
There’s really a 13th step…celebrate your accomplishments in getting this far, and the next step in your medical career that awaits!
As you can see, it takes a lot of planning and careful execution to open your own practice. But if you perform steps similar to what we’ve posted here (and undoubtedly a few more), you’ll be well on your way.
Remember that too many providers have regretted launching their dream without tools that don’t support a seamless and positive patient and staff experience and have often paid a very real price for trying to back-fill them later. These investments are key to fulfilling your dream of career autonomy and making a very real difference in people’s health and lives.