Starting a medical practice can be an exciting route for patient care. You can channel your passion for medicine in the way you see fit by running a successful practice.
However, starting and running a successful medical practice isn’t without its headaches. You might be a highly trained and skilled physician, but you must also know how to run a business.
This guide reviews everything newly formed and aspiring private practices need to know. You can also explore our medical billing and coding services for more helpful information.
How to Obtain Funding
Funding is one of the most important things to consider when starting a medical practice. Medical practices can vary widely, but you can expect to need at least $100,000. This initial funding will cover startup and equipment costs.
An additional $100,000 credit line can cover bills and payroll until your practice generates significant revenue. Of course, many people won’t have this amount. To secure enough funding, you can explore business loans.
To increase the chances of securing successful business loans, you’ll want to create a pro forma. A pro forma is a condensed business plan detailing debt projections alongside revenue. In your pro forma, you should factor in any projected expenses, including:
- Equipment costs
- Electronic health record expenses
- The square feet of your lease
- Office and medical supplies
A robust pro forma should project revenue over three to five years.
Hiring Staff and Purchasing Equipment
After securing business loans and a line of credit, start hiring staff and purchasing necessary equipment. In today’s modern world, healthcare facilities use electronic software that makes the job easier, including:
- Electronic health record systems
- Medical billing services
- Practice management systems
- Medical transcription software
- Credit card processors
Navigating and managing such software and systems can increase upfront expenses. However, they can also make your practice run much more smoothly and may allow you to hire fewer staff members. When hiring staff, remember to hire an office manager.
Lastly, run comprehensive background checks on every staff member you hire. For example, whether hiring a custodian or another physician, you should check their employment and criminal histories. For medical care facilities, employees also must have specific certifications and licenses.
Fulfilling All Legal and Practice Requirements
Before opening any business, you must meet certain requirements. For your private practice, make sure to:
- Obtain a tax ID and incorporate your medical practice as a legal entity. Different options exist, like an LLC, C-corp, general partnership, and more. You’ll gain tax benefits alongside protecting your practice from getting sued.
- Credential your healthcare providers.
- Purchase insurance, including medical malpractice insurance. You may also need to purchase workers’ compensation from insurance companies.
How PracticeForces Can Help
Running a private medical practice is exciting but has unique challenges. Instead of trying to have you and your staff handle everything, you can outsource some of the work to experienced professionals. When starting a medical practice, explore how our team at PracticeForces can assist.