Were you one of the kids in elementary school that said you wanted to be a doctor when you grew up? Maybe you were, maybe you weren’t but at some point in your life you developed a passion to help people and that passion turned into a determination. Your passion and determination is what made you become a doctor.
The fact that you get to do what you love is one of the best feelings in the world, right? Yes but it has its restrictions. You can’t operate exactly how you want, you don’t really work with people who embody your same core medical values, and it’s just not quite as fulfilling as you hoped. So what do you do? You decide to open up your own medical practice!
Opening your own medical practice is definitely an exciting journey to go on… you’ll truly be able to practice medicine the way you want. Now, as mentioned, it is an exciting journey but it is also a challenging one. In order to have a successful practice, you need to lay the proper groundwork at the beginning with detailed planning in order to execute everything successfully.
From hiring the right people and purchasing the right equipment down to finding the perfect domain name and establishing your brand, you will definitely have your work cut out for you with opening your practice but once everything is in place and you’re ready to open, all the hard work and effort will be worth it.
Why Open Your Own Practice?
This is the first question you want to ask yourself before even considering starting your own practice is why do you want to do it? The answer will be different for different doctors. Some doctors do it because they want to make more money; some doctors do it because they simply want to be their own boss and treat their patients in a way that embodies their medical practice core values.
The Bottom line is, determine exactly why you want to start your own practice and if feels right in your heart, then follow your heart. Take a look at these steps you need to take in order to get your private practice off the ground.
Step 1: Create a Realistic Pro Forma for Bank Investments
If you’re not too familiar with what a pro forma is, it is a smaller version of a business plan with real-time projections of debts and revenues. You’ll need a pro forma when looking for investment prospects from bankers. They will want to see a strong pro forma that shows projections at least three years in advance in order to even consider financing your business.
The reason you need a strong pro forma is that bankers know that as a doctor, you’ve already taken on a huge amount of debts to pay for medical school. They want to make sure they’re making the right choice by investing in your practice, knowing that they’ll have a great return on investment (ROI).
Step 2: Buying the Right Equipment and Finding the Right Staff
Once you’ve obtained the proper financing to get your practice off the ground, now you can really start to get to the nitty-gritty of your practice, which is hiring the right people and buying the right equipment and software.
Practice Management System
This is a system that runs all of your practice’s front office operations. The important part of your practice management system is monitoring your billing and revenue cycle. It bills patients and sends claims to insurance companies. In addition to the practice management system, you’ll also want to incorporate a third-party medical billing service and purchase medical transcription software.
Background Check Services
The foundation of medical practices is based on trust due to handling sensitive information about patients medical history. This trust that is required in this line of work goes way beyond exam results, medical diagnoses, and treatment procedures… for certain positions you’re hiring for, there will be certain licenses and certifications that your staff will need before you can consider hiring them. The staff that you will need to hire will depend on your specialty but in general, your practice will most likely need:
- Nurse Practitioner
- Medical Assistant
- Director of Nursing
- Office Manager
- Medical Records
Failing to make sure ALL of your staff has the proper credentials can result in serious penalties for your practice. So make sure you have taken every measure to hire the right people with the right credentials and that they’re people you can trust.
Step 3: Get Ready to Open Up Shop!
Before you can officially open, there are a few things, legally, you need to get in order first.
Get Established as a Legal Entity
This one is an obvious necessity but still a very important step worth mentioning. The whole purpose of this is to protect you with limited liability, meaning if you’re sued, the only assets at risk are the company’s… not your personal assets; without it, you’re opening yourself up to your personal assets being threatened. When it comes to choosing a business entity, you definitely want to do your research on which entity will suit your practice the best.
Get Your Policies, Procedures, and Compliance Documentation In Order
In order for your practice to open and be successful, you need to establish a set of policies and procedures as well as legal rules and regulations to cover all of your daily operations. In the medical world, healthcare is always changing so you want to make sure your practice is up to speed on the never-ending changes. In fact, although healthcare is constantly changing, the National Center for Biotechnology Information states that there are seven policy changes that will improve the value of healthcare everyone needs.
As a business owner and a doctor, you know the importance of insurance so you definitely want to be covered by malpractice insurance. In addition to that, the bank that invested in your practice might require you to purchase liability and life insurance as well.
Step 4: The Grand Opening
Now that you’ve laid the groundwork and put in the blood, sweat, and tears necessary for your practice, the time has actually come to open the doors to your practice. Once you cut that ribbon and start seeing your first group of patients, all of the hard work will totally be worth it and you can run your practice how you want.