Ease of setting up a psychiatry private practice?

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Technotronic said:
Are you starting cash and then going to insurance slowly (what I am thinking) or are you going to apply for insurance panels immediately?

Also, how did you choose location? I tried to pick a location where there were a few PCPs as I figure that would be a good referral source.
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I have a FT day job 4 days a week right now, so my plan is to start out cash and stay cash. I don't have a financial drive to get on insurance panels at this point. If I was going FT PP straight out I'd probably get on a number of panels. I'd also be reaching out to PCP's quickly.

As for location, I'm living in a big city and chose to live in a neighborhood that close to work opportunities for my wife, and commutable for me (highway access). Because of that, I'm already situated near a lot of high traffic areas, and so found a sublease office a few days a week (via an MFT listing site) less than a mile from my home.
 
nitemagi said:
I have a FT day job 4 days a week right now, so my plan is to start out cash and stay cash. I don't have a financial drive to get on insurance panels at this point. If I was going FT PP straight out I'd probably get on a number of panels. I'd also be reaching out to PCP's quickly.

As for location, I'm living in a big city and chose to live in a neighborhood that close to work opportunities for my wife, and commutable for me (highway access). Because of that, I'm already situated near a lot of high traffic areas, and so found a sublease office a few days a week (via an MFT listing site) less than a mile from my home.
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Sounds like my dream job. Good luck, and keep us updated! I'll need some tips in another 5 years or so...
 
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If you get on insurance panels, the floodgates will open in terms of patients filling up your office time.

Cash-only, works but less patients are willing to do this. At least where I'm at, while I do cash-only for many of them, they're about 15% of the patients. My office time is pretty much filled up though I don't have waiting lists months long.

At least based on the dynamics in my area, I'd do perhaps some insurance panels at first to get the office time filled up, to prevent dead time, while trying to fill up cash only over the long run.

Some insurance companies are a much bigger pain vs. others. Humana, for example, their PA process is long and painful and requires a physician. Each PA, I'm talking at least 10-15 minutes of time you won't get paid for unless you bill the patient for time spent on a PA.


You probably don't know which insurance companies are the pains in the butt before you start a practice, and unless you know someone who's spent a lot of time with this, you likely won't until you put in the time.
 
Be careful about insurance plans and jumping aboard too quickly in a low demand area. You won't get good rates and actually they will probably right at medicare rates. Although with what's about to happen, it may be a good idea to jump aboard quickly.
 
Sharpie1 said:
What's about to happen?
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I think he was referring to the medicare cuts that are coming as part of this whole Debt Ceiling bill thing.

Either way, the sky is falling and we're all doomed. On the plus side, crazy inflation will make any student loans you hold worth less in real dollars, so they'll hopefully be easier to pay off...I hope.

And, this may finally make us move to a cash based model, which would be wonderful for primary care medicine in general, and psych is already doing half the time anyways.

I expect the number of medicare providers to drop drastically (baring a fix) and wait times to get so insane that people with the means will gladly shell out whatever cash fee you require to get seen in a reasonable time frame.
 
Regarding what's about to happen: I was not predicting what happened today (the giant collapse in the NYSE) however, the long term outcome wasn't good and I luckily sold a bunch of stocks that I am going to be buying back slowly as they level out (wish I had sold all of them).

Also, there is the medicare issue that digital mentioned which is less of an issue because medicare mental health is usually a small part of private practice (unless you are itching to close your doors). However, private practice does follow medicare rates to some degree and so it will be interesting how that will play out. I imagine a lowering in reimbursements with no lowering in premiums. We are already opening a cash only office with one psychiatrist completely opting out and the pcps that we work with are going the same route.
 
Hi everyone! I've enjoyed reading the thread, it's nice to see other people out there with an entrepreneurial spirit. I earned a Master of Science in Mental Health Counseling four years ago and completed my internship hours to attain my full license as an LPC (Licensed Professional Counselor). Now that I have some quality experience working at a small business, I've decided I'm ready to start a practice of my own.

I think partnering with a psychiatrist would make for a great team and an excellent foundation for a successful business. In my opinion, it would not only be a great way to split overhead costs (office rent, secretary/admin pay, phone/internet/website), but perhaps a partnership such as this in a single location would be a draw for those highly coveted self-pay clients.

Does anyone have any thoughts/experience/suggestions when it comes to this? Also, if anyone is in the Dallas/Fort Worth area and has any interest in pursuing this idea further, I'd love to hear from you. Thanks!
 
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I'm considering breaking away form the PP I'm at and starting a new one perhaps 1-2 years down the road. I would not do it unless I had people working there or a strong collaboration with non-psychiatric mental health workers.

The fact of the matter is psychiatrists are usually (emphasis on usually) terrible at some aspects of mental health treatment such as being able to diagnose and treat issues that do not need medication such as borderline PD. I want someone who can easily provide me with an MMPI, and TOVA test. I want someone to refer borderline patients because I know I don't have enough expertise in that area.

A change since my last post is that I now do have a waiting list that months long. I've filled up and cannot see more patients unless I get ones better, thus reducing the need to see them more often, or I increase my hours at the PP. I'm cutting them due to picking up a new position.

Ideally a practice IMHO should have a few psychiatrists, psychologists, counselors, a nurse or NP, and an office manager. One could do it completely with just the psychiatrist (or psychologist) but there'd be much more profit, decreased overhead through shared costs, ability to refer to others for needed services, and being able to take time off for a needed break when you work as a team.
 
whopper said:
Ideally a practice IMHO should have a few psychiatrists, psychologists, counselors, a nurse or NP, and an office manager. One could do it completely with just the psychiatrist (or psychologist) but there'd be much more profit, decreased overhead through shared costs, ability to refer to others for needed services, and being able to take time off for a needed break when you work as a team.
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I dunno. I have a cash only practice based on renting some furnished office space 2 days a week right now. My overhead is <$500/mo. The more of a team you build the more patients you can probably see, but which involves less time per pt. for you as the provider.

I think it depends on location and what type of services you want to offer. I offer both medication management and various forms of psychotherapy (CBT, DBT, hypnosis, psychodynamic), making me more of a 1-stop shop. Can always refer out for testing if I want.
 
Hmm <500$ month? Pretty good.

Though I suspect if this is the case (correct me if I'm wrong), you're renting from another doctor, in which case you're decreasing his overhead and yours by not having to handle an office completely on your own.

Hey, if it works for you--so be it.
 
whopper said:
Hmm <500$ month? Pretty good.

Though I suspect if this is the case (correct me if I'm wrong), you're renting from another doctor, in which case you're decreasing his overhead and yours by not having to handle an office completely on your own.

Hey, if it works for you--so be it.
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True. I rent the office space and that helps. But with current EMR's, voicemail, electronic billing, credit card payment options online, it's quite doable to run a PP with minimal setup and overhead. That's one of the beauties of psychiatry - you can have a desk, two chairs, and a scriptpad and that's enough (not all I have, just saying).

On the other side of the coin, some people set up PP with 3-5 therapists working for them, psychologists doing testing, strong referral base, and do 15-minute med checks clearing 7 figures. Not the setup for me, just noting there are many options for those that're entrepreneurial.
 
I couldn't negotiate with the APA to reduce part-time malpractice from 20 hrs per week to something on the order of 10 hours a month. Thinking about starting a free clinic on the side for the uninsured who don't qualify for state benefits and can't afford out of pocket fees. I can get an office for $10 an hour. The cheapest I can get is 3.5k - 4k per year in overhead (pretty much all malpractice) which would kill me on my resident salary. Considering donations. Waiting from my residency program for their input.
 
F0nzie said:
I couldn't negotiate with the APA to reduce part-time malpractice from 20 hrs per week to something on the order of 10 hours a month. Thinking about starting a free clinic on the side for the uninsured who don't qualify for state benefits and can't afford out of pocket fees. I can get an office for $10 an hour. The cheapest I can get is 3.5k - 4k per year in overhead (pretty much all malpractice) which would kill me on my resident salary. Considering donations. Waiting from my residency program for their input.
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Did they have an early career discount? Shop around.
 
I don't know much about physician malpractice insurance... good time to learn. However, for those of you interested in good car insurance I recommend Progressive and enrolling in the Snapshot discount program. I saved over 30%! :thumbup:
 
F0nzie said:
I don't know much about physician malpractice insurance... good time to learn. However, for those of you interested in good car insurance I recommend Progressive and enrolling in the Snapshot discount program. I saved over 30%! :thumbup:
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How much did you receive for posting this endorsement ? ;)

Fonz, what state are you in? I might have a recommendation or 2 based on your location. PM me.
 
Starting an insurance-based private practice would be so much more attractive if insurance companies implemented a card swipe system that automatically puts money into your bank account after the patient is seen. Much better than getting $15 an hour in copay, hiring staff to chase the money down...and still not knowing if you're going to get paid! :thumbdown:

Get rid of the prior auth crap too. Yesterday I spent over an hour on the phone with medco to prescribe Abilify, then they faxed me a questionaire twice. 1.5 hours of my time over the course of 3 days. Wtf.
 
Question! *raises hand*

With a cash only practice do you have incentives to make treatment time longer and using superflous verbiage to make more money? I dont want to say that psychiatrists would unintentionally rack up the bill of a rich patient with problems, but it isn't out of the realm of the possibilities.
 
How long of a time would it take to realistically build up a cash-only practice in the greater LA area, say, starting 1 or 2 days a week with the remainder being a state job (and decreasing the state job as the private practice grows)? 2 years? 3 years? Or is the LA market super saturated with cash-only psychiatrists?
 
PistolPete said:
How long of a time would it take to realistically build up a cash-only practice in the greater LA area, say, starting 1 or 2 days a week with the remainder being a state job (and decreasing the state job as the private practice grows)? 2 years? 3 years? Or is the LA market super saturated with cash-only psychiatrists?
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;
There's gold in them hills. Just look for more Heidi montags
 
ZuperZtar said:
Wouldnt overhead be a LOT less than a PCP office? No EKG machines etc. Just a chair, desk, trash cans, etc. and a billing service and possibly a secretary. I would say in a cash only private practice, you could easily make 200k after expenses. Am I logical in my thought process?
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Hello,

So can you open a private practice, at my house? i have a Master. do i need anything alse? like a permit? or something like that? or register my name?

thank you for all your ideas!

Jose Rico
 
Jose Rico said:
Hello,

So can you open a private practice, at my house? i have a Master. do i need anything alse? like a permit? or something like that? or register my name?

thank you for all your ideas!

Jose Rico
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You need to be licensed within your state to practice psychology clinically. Then you may need to talk to your locality (city) as to business zoning.
 
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