How To Start A Medical Practice: The Complete Guide

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The COVID-19 pandemic has made it more obvious than ever before: we need doctors! In fact, there's currently less than one doctor available for every 1,000 people on the planet. The demand for more doctors is ever-growing, encouraging more physicians to open their doors. 

Are you thinking of starting a medical practice of your own this year? Before you do, make a plan! With these tips, you can learn how to start a medical practice without a hitch. 

Then, you can open your own doors and experience the freedom of running your own practice. Start helping patients with these seven tips for setting up a medical practice today! 

1. Understand The Expense 

Before you can learn how to start a medical practice, you need to make sure you can afford it. 

Starting a medical practice is more costly than some people might think. Opening your doors could equate to $250,000 in startup costs. If you don't have that amount of capital in hand, you'll need a plan. 

It's important to start this process as soon as possible. In some cases, acquiring the funding you need can take time. Determining your potential expenses and setting a budget can help you get the capital you need. 

First, consider how much you'll need just to get your medical practice running. What will your operating expenses look like during the first few months? 

Once you determine your startup costs, you'll want to save a little. A nest egg can give you wiggle room to keep the practice running if you don't immediately attract patients. 

Expenses 

Do you have an estimate for your startup costs yet? You'll want to consider everything to calculate an accurate estimate, including: 

• Construction 
• Real estate 
• Equipment 
• Consultant fees 
• Accountant fees 
• Attorney fees 
• Marketing 
• Office furniture 
• Recurring disposable supplies (gloves, bandages, PPE, etc.) 
• Computers 
• Medical recording software 

Working with medical practice management consultants can help you get your practice running efficiently, which can improve your ROI.

It's important to avoid underestimating your startup costs. After opening a medical practice, some physicians are forced to shut their doors only a few months after opening. You don't want to stress yourself out looking for capital to stay open. 

2. Acquire Funding 

Now that you have an accurate estimate for your startup costs, you'll need to acquire funding. 

When learning how to start a medical practice, you might consider seeking a small-business loan. However, many medical practitioners already have medical school debts to deal with. If you're in the same boat, you might want to consider refinancing your school loans first. 

In the meantime, it can help to expand an existing practice or take over for a retiring physician. Both options are cost-effective options for starting a medical practice of your own. You can leverage the previous physician's list of patients and grow the business as you see fit. 

Remember, you'll need to pay for expenses like rent and salaries as you open. Once you acquire funding, avoid unnecessary costs to stay on-budget. 

3. Complete Credentialing 

Medical practices need to complete the credentialing process to accept private or government health insurance from their patients. 

Unfortunately, this process can take a few months. With that in mind, you'll want to get started as soon as possible. Otherwise, you might have to delay opening a medical practice. 

During the credentialing process, insurers will ask about your professional history. For example, they'll need to know where you went to school and where you completed your residency. You'll also need to discuss your licensing and malpractice insurance. 

Once you begin the credentialing process, you can work on the remaining items on your "how to start a medical practice" checklist in the meantime. 

4. Select Your Legal Structure 

In order to open your practice as a running business, you'll need to select a legal business structure. Your business structure will determine: 

• How you pay taxes 
• Who is primarily liable for debts and losses 
• How much you're personally liable in the event of a lawsuit 

If you choose to file as a C corporation, you'll get taxed on personal income at the entity level. Forming an S corporation, on the other hand, means you'll only pay taxes on your personal income. In any event, it can help to hire a lawyer with experience in the health care industry. 

A qualified lawyer can ensure you correctly draft legal documents, including your articles of organizations and incorporation. They'll help you file a partnership agreement if necessary as well. If you make a mistake filing these documents on your own, it could delay the entire process. 

Don't forget to apply for your employer identification number. Then, register for your local and state taxes online. 

5. Apply For A License 

While setting up a medical practice, it's important you receive your license from the medical board in your state. Your Federation of State Medical Boards' website can get you started with this process. 

You'll also need to acquire your national provider identification number. Private insurance companies, as well as Medicare and Medicaid, require this number. If you plan on prescribe medications, you'll need a DEA number, too. 

6. Select Your Location 

Do you have a location for your medical practice chosen yet? If not, get searching! Make sure the location fits your budget. 

You'll want to consider your target audience, too. Can your patients reach you easily? Is there adequate parking? 

About 84% of adults have contacted a healthcare professional in the last year. However, only 54% of patients visit their primary care physician. It's important you're easy to find and reach. 

Otherwise, patients might not prioritize appointments. 

Once you have a location, start gathering the software, supplies, equipment, and furniture you need. 

7. Attract Patients 

Take time to plan for staff based on your budget. Once you have a location and a team, it's time to attract patients to your practice. 

There are a few different marketing tactics you can use, including pay-per-click (PPC) advertising and search engine optimization (SEO). Make sure you have a mobile-optimized website your patients can use to find your practice. You can also use social media to connect with prospective patients, too! 

How To Start A Medical Practice: 7 Tips For A Successful Setup 

Now that you know how to start a medical practice, get to it! These tips can help you avoid potential pitfalls that could cause you to close your doors too soon. Start a medical practice and start helping patients in need today! 

Want to start reaching patients online with telehealth and telemedicine? Advertise your new medical practice with us today! Contact us now.