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Starting Your Own Medical Practice

– Contributed content –

Doctor's labcoat

(Darko Stojanovic, Pixabay)

7 Mar. 2020. When you are working in the medical field, it’s easy to see the holes in the way that people practice. You want to offer something more, and so the idea of opening your own medical practice has come across your mind a time or two. It’s a great way to take medicine into your own hands and do things in a way that you believe is best. The problem with opening your private medical practice is that it’s not easy: in fact, it’s an enormous challenge! Of all of the sectors in which you could be involved, medicine is possibly the most complex because it consists of the well-being of other people. Your decisions can be life or death, and you want to make sure that before you dive in, you have a plan.

A plan for a new medical practice isn’t the same as a regular business plan. You need to ensure that it’s executed with total precision, that you put together the right team to help you find the right equipment for everything to run smoothly. On top of all of this, you also have the red tape of insurance and the tax implications together for making this one of the biggest challenges that you will ever face in your professional career.

Below, we’ve put together the outline that you will need for this medical practice idea of yours to become a reality. You should always have professionals working alongside you when you choose to take on a massive job like this one, but don’t be surprised if there are things here that surprise you. Your mentors should be able to guide you through it carefully and precisely so that the end result is a brand new medical clinic that works for you and for the community in which you are building your new business. Let’s go through the plan and help you to get started.

Know your why

Why do you want to do this? In the field in which you work in medicine, what makes you think that a clinic will be a good idea? These may be two tough questions to answer, but you need to be able to answer them if you have investors or partners asking you these questions. With the risk and the cost of opening your practice, you have an uphill climb on your hands. Adding to this, the fact that there are huge hospitals and healthcare providers in control of much of the industry, and you have to think carefully about why you want to do this. You’ve already gone through medical school and board certifications, so why would you want to layout a high cost for a clinic that may not work? You could walk into any great job that you want with your qualifications and experience.

There is more competition with private practice and smaller medical clinics than with large hospitals, which puts you smack in the middle of the race to the top. However, you will be able to gain better control over the way that you work, with more autonomy in your choices. You are free to dictate and function to your own rules which means that you can also expand your efforts into the underserved local areas. You are your own boss with your medical practice, which means that everything from the decor of the clinic to the range of medical fridges that you buy is in your hands and your power to choose. You are challenged, able to reach new heights in your medical career, and you can continue your education at the same time. It’s a challenge to get started, but that doesn’t mean that you can’t do it.

There really is no right way to get started with your own medical clinic. You can bring someone in to consult and help you, to be a mentor who has done this before and can talk you through the steps for getting it off the ground. Your specific needs to get your medical practice off the ground are going to differ from all the others out there who are doing the same thing, but there is one place that you need to start: your finances.

Financing

How much you need depends on what your goals are for your clinic. It would help if you had an idea of what you need, for example, your startup costs will need to cover your medical equipment, payroll, bills and commercial rent until your revenue is stable. This will take some time, as it would with any new business. Many doctors or medical clinicians who start up their own practice do so off their own money. Some choose to partner with a range of other professionals to create a medical practice that covers a variety of medical needs. Your biggest challenge will be convincing the bank to lend you the money that you need if you plan to go it alone. Some of the steps that you will need to take include:

  • Create a business plan to obtain your finance. This works similarly to a business plan, and you need to outline your expenses, debts, and how much you anticipate earning. You need to be realistic about this, though, as your bank manager will tell whether you are embellishing your numbers! It would help if you had the financial projections for at least three years so that you can show that you have a long-term goal.
  • Costs should be listed and itemized here, and you need to include:
    • Lease costs
    • Costs of setting up the practice
    • Advertising and marketing
    • Branding costs
    • Electronic health record expenses
    • Medical supplies and equipment (machinery and medical fridges, etc.)
    • Office supplies
    • Payroll and employee costs
  • It would be best if you found specialists in providing finance for a medical practice. They’ll understand where you’re coming from as well as the expenses, risks and the revenues of the sector itself. You can go to the regular bank, but they won’t have the know-how of the experts out there.
  • Don’t just rely on one bank to come back to you. Submit the finance request and your business plan at a range of banks and financial institutions as you can then open the door to more than one offer. When you have more offers, you get to rely on better choices. You can then choose what’s most attractive to you and go from there.
  • Always stay conservative when it comes to detailing your purchase of equipment and furniture. You don’t need the very latest and most expensive models of everything; not when you first start up!
  • You will always encounter a waiting period with the bank after you’ve submitted all your plans and forms. It’s in these waiting periods that you will need to think about getting ready for those crucial next steps. These include getting your tax ID sorted, buying the right malpractice insurance and incorporating your clinic as a legal business.

It’s not always easy to obtain financing for a medical practice, but that doesn’t mean that you can’t. The biggest contention will be how much medical school debt you still have left to pay, and whether you can prove that you can pull in the patients to be your paying customers. A rational and clear business plan is an absolute must if you want to start up. You have to be able to show where your profit and capital will be coming from. It’s why medical clinics are a risky business to start: but you have to start somewhere.

Equipment and staffing

When you have your financing sorted, you can then start making plans for your equipment and your staffing plans. You should be hiring your team based on what you need and their expertise. You will, of course, have a network of colleagues in the medical field, but really consider what your clinic needs and choose the staff based on that. You should be considering the following things when it comes to your equipment for the office and your staffing:

  • Electronic health record systems are one of the most significant tools for your medical clinic to use. It’s not just about what your patients need in terms of data protection, but what you need for the best possible efficiency in your practice. You can have one system for your patient histories, the records you keep and all information pertaining to other providers. All communications that you need to make with regards to prescriptions and revenues are all stored here, which makes it a one-stop system for your whole practice.
  • You need the services of an external HR advisor and a medical board delegate to help you with your hiring system. Make sure that you have the personnel that you need to ensure that your practice runs smoothly.
  • All businesses need to be registered, with the right tax information so that you remain a legal business entity and above board with the IRS. This is not a step you want to skip!

Running your own medical practice will take time and patience, but it can be done if it’s what you want to do. Get advice, get financed and get started.

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