Starting your own medical practice can be a daunting challenge. From creating the business plan to making administrative choices, you’re responsible for every decision along the way. It’s important to do your research to ensure you’re organized and prepared for the many tasks to come. For example, since the credentialing process can take up to six months, you should get started on that early. This 7-step guide will give you a clear roadmap to follow to help ensure a successful opening of your medical practice.
A business plan is a 3-to-5-year projection of your anticipated revenues, expenses, and debt. You’ll show it to lenders to help secure financing. It’s important to be as detailed as possible when creating your plan, both to assuage any potential doubts about your practice from the lender, as well as to help drill down into the nuts and bolts of what your practice truly needs to succeed. Your business plan will include:
Remember: your expense projections can fluctuate over time. For example, your loan interest could decrease, or your medical supply costs could increase.
Once you’ve completed your business plan, the next step is to submit it, along with your loan request, to different banks and lenders. Check to see if any of them have a medical division. Doctors might have trouble raising money with regular bank loans due to their unique financial situation. Since many doctors have med school debt, they might be viewed as risky borrowers, even though their future income is high. Lenders who specialize in the medical field are familiar with this unusual financial dynamic.
Choose the financing option which offers the best terms, whether it be the lowest interest rate or the duration of the loan. If you have med school debt, now might also be a good time to look into refinancing your student loans.
You’ll need to do a variety of paperwork and secure credentials in order to open your practice, including:
If you’re planning on accepting insurance, you need to get credentialed with each insurance company. This process can take up to 6 months, so it’s important to start the process early. Insurers will want to see your medical license, work history, proof of malpractice insurance (varies by state/specialty), and information regarding your medical education/residency. You’ll then need to negotiate contracts with your insurers regarding the terms of payment.
Your next step is to select the location for your office. There are a number of factors here to consider, including local competition, parking availability, and operating out of a multi-use space versus a standalone clinic, to name just a few. If any renovations are required, you’ll have to incorporate that into your estimate of when you expect to open. Steps required for setting up your physical practice include:
Next, you’ll need to purchase office equipment and practice management software to help with important administrative needs such as scheduling and billing. Make sure to purchase:
At Key, we get it – your patients are your top priority, not your payments solution. Our healthcare solutions can help increase your patient payments and improve operational efficiency. Interface with your current practice management system too.
Once your technology is in place, it’s time to focus on marketing your practice. You’ll need to let potential patients know that your practice is open and ready for business. There are numerous components to marketing your medical practice:
The last step is to finalize decisions about your practice’s daily operations. For example, what are you going to charge for your services? If you’re hiring a staff, what will your office policies be? How are you planning to handle employee contracts? While these steps may not seem as integral to your business success as some of the bigger items above, they can make the difference between a business stumbling or running successfully.
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