Costs and figures... startup Solo podiatry office

[Feli]

$ Expense

5,111 Malpractice
6,270 Licensing and Board Exams
436 Travel
10 Parking
790 Education, Training, CME
2,185 Fuel (doc miles)
_14, 802 expenses related to doc

1500 Legal and Accounting
35 Bank Fees
758 Insurance Office Liab
12,532 Rent
2,393 Utilities (net+ph, digi fax, emails)
2,264 Phones (Ans Svc, voice svc)
8,203 Software (EMR, AntiVir, etc)
68 Mail (shipping, stamps)
8,466 Office Supplies
38,292 Cost of Goods Sold (med supplies, incl fully stocked cabinets and closet of DME, OTC, etc not yet used)
2,616 Medications (inject, crms, etc)
_77,127 expenses related to office ongoing

410 Office Décor (desks, shelves, etc... not sure how this was so low... prob put much in Office Supplies cat)
2,265 Tools (instruments, etc)
6,958 Depreciable Assets (u/s, autoclave, exam chairs)
_9,633 expenses related to office startup

1,592 Website + FB
7,707 Marketing
_9,299 expenses related to marketing

834 Uniforms
403 Insurance Work Comp
78,661 Salaries (staff salaries + bonuses + etc)
63,268 Distributions (doc... basically the amount you have to pay yourself as you can't deduct or invest any more of it)
15,733 Medical Billing svc (% of collect... plus hourly rate for credentialing and re-cred)
6,166 Meals (50% deduct)
1,415 Entertainment (not deductible.. but fun for staff+doc)
803 Charity
25,600 Taxes
_192,883 expenses related to employees

___303,744 TOTAL


Avg = 161/visit
(this incl post op globals $0, many $0 visits early on from not being on all plans yet... plus many visits for last year are paid in this calendar year by payers and pt pays - yet no income from year before last come in last year, as it's a startup)

...This was not a full year above... it was roughly 9.5mo. It was a cold startup with nothing but walls and floors (no buildout, though). I did have some rep and name recognition in the city/area. I left a large group after they'd cut my pay and were pressing me for certain internal refers and services I wasn't a fan of. I resigned on a Friday and opened on a Monday; however, I'd had at least a month of dead utilities + rent prior to that when arranging the office solo on my evenings/weekends off. It was a hectic couple of months of logistics before launching, but it worked well.

I did many free visits early after going solo (was not on certain plans, was not on MCA, just saw the pts from any and all payers to keep goodwill... "we accept all area plans," took walk-ins, etc). We'd tried to have a first week to set up, but patients showed up from day 1. The first month or two was seldom full days... usually 5-10pts. The office I resigned at fought back hard and generally did not tell patients I was still nearby, but many new pts and prior ones found my solo anyways. I did one employee to start but had to add another within a month due to demand; mine are full time salaried at around 20% over area average pay for their job type. Now, I have a totally full schedule booked a month or two out for some non-acute stuff... we now can only take same-day for pretty serious stuff or if we have a cancel spot arise (which is the norm for any decent doc in the area, with exception of other podiatry offices... taking same/next day, of course).

We will obviously maintain connections and our rep/refers but largely let off on marketing going forward as we've hit all marks that we'd tried for. Expenses for this new year now in progress - the first full calendar year for the office - will be roughly $400k+ gross, roughly $200k to doc (salary + distributions), closer to $200/visit... and those are low estimates. I can post actuals around this tax time next year.

Take home points:

• It can be done. PP is very viable for podiatry. It does not take a ton of patients to be profitable. I also noticed my collections were significantly higher per pt than prior owner said they were (tells you all you need to know right there). You can take no salary the first year if you're unsure that you will be profitable, but it's wise to add a doc salary once it's clear you're profitable. You can always take more ER and inpt work if you need to in the early going (I don't refuse it... but I definitely try to take less and less, just have them f/u outpt).
• There are plenty of DPMs who do this. I know many personally. I am nobody special. All who I know doing solo PP do fair to very well, and for various reasoning (see trifecta ideas below). The only way to f*** it up is basically to defeat yourself with fraud services (audit and kicked off payers) or maybe super fancy office and buildout and grand equipment leases where your overhead sinks you before you can fill the appointment book.
• Startup office is not as expensive as one thinks (I used maybe $50k of my own money to buy supplies and pay staff and pay for credentialing and attorney work... was profitable within 3 months, paid myself back gradual, then still had end-of-year distributions above). You can stock minimal DME and supplies in the early going, and I did... now, I buy as many CAM boots and arch supports and Coban and ankle braces and whatever as I can fit in the office (inflation will only increase their cost if you wait).
• Staff and EMR and malpractice (and XR if you finance it) are the main monthly big hitters to your budget, as seen above. Exam chairs and autoclave and ultrasound are not cheap, but they're basically one-time. You can obviously go as basic or fancy as you choose. I used no financing at all (savings and cashed out IHS job 401k), but that's just personal choice not to take on any debt, use biz debit card and not credit.
• This office is done without scammy grafts, other nonsense which insurances are now clawing back on. It is also without Xray revenue (I lease in a hospital, Rx XR to them). This is just income from basic visits, injections, basic office procedures, surgery, basic DME, OTC, rare anymore to do ER or inpt consulting. There is potential for much more (DM shoes, more OTC, various in-office cash svcs, etc), but I'm just fine without it.
• It is very easy to make much more by more pt volume also... this is rougly 4.5 days/wk, 15-18pt/day, banker hours. Staff are well paid, same ones since startup. We all enjoy the flow, get our lunches, feel steady but not overworked if we have an add-on or two. We are nearly always caught up and in a good mood, run on time, patients are happy, PCPs are happy, and we are perpetually on a waitlist due to our good rep and results in the area - despite other nearby pod offices taking same day and walk-ins.
• Second, third, etc years will obviously make much more than the first year. The office schedule will be full consistently, office will be on all payers, kinks in system will be worked out, will not have the one-time expenses of chairs and autoclave and computers and furniture and etc that we had starting out. However, malpractice and staff wages and EMR cost and tax bracket other things will always go up (inflation, more income, etc etc).

Biggest points to remember for docs considering PP of any kind (startup, buy in, buy out):

• You will be able to work roughly half as much (patients/day), you will be able to make twice as much (% kept vs associate work with owner minimizing your collections and taking from you), or you can choose a combo of both of those. I obviously choose about two-thirds patient load to take in roughly one-and-one-third income level of most podiatry associates.
• Much more than money, you gain the ability to control who you work with, what refers you try to gain (or refuse), choice of supplies, etc. There is no more bargaining or appealing to bosses to get those things done. There is no more asking for days off or haggling about the call schedule or any such inefficient nonsense. You obviously gain ultimate job security if you do any decent job at it. Once the solo office system is in place, you basically just need to attract and retain good people to run it along with you.
• Remember the magic trifecta of PP podiatry : good payers area, likable doc (and staff), little nearby DPM competition. Those are the main keys to success.

Again, like GreenGreen thread on buying out a retire pod doc, this is not bragging... just food for thought. Hope it helps. I can reply to questions or PM as able. 👍

---

Members don't see this ad.

 

[HardRoadPaved]

$ Expense

5,111 Malpractice
6,270 Licensing and Board Exams
436 Travel
10 Parking
790 Education, Training, CME
2,185 Fuel (doc miles)
_14, 802 expenses related to doc

1500 Legal and Accounting
35 Bank Fees
758 Insurance Office Liab
12,532 Rent
2,393 Utilities (net+ph, digi fax, emails)
2,264 Phones (Ans Svc, voice svc)
8,203 Software (EMR, AntiVir, etc)
68 Mail (shipping, stamps)
8,466 Office Supplies
38,292 Cost of Goods Sold (med supplies)
2,616 Medications (inject, crms, etc)
_77,127 expenses related to office ongoing

410 Office Décor
2,265 Tools (instruments, etc)
6,958 Depreciable Assets (u/s, autoclave, exam chairs)
_9,633 expenses related to office startup

1,592 Website + FB
7,707 Marketing
_9,299 expenses related to marketing

834 Uniforms
403 Insurance Work Comp
78,661 Salaries (staff salaries + bonuses + etc)
63,268 Distributions (doc... basically the amount you have to pay yourself as you can't deduct or invest any more of it)
15,733 Medical Billing svc (% of collect... plus hourly rate for credentialing and re-cred)
6,166 Meals (50% deduct)
1,415 Entertainment (not deductible.. but fun for staff+doc)
803 Charity
25,600 Taxes
_192,883 expenses related to employees

___303,744 TOTAL


...This was not a full year above... it was roughly 9.5mo. It was a cold startup with some rep and name recognition in the city/area. I left a large group after they'd cut my pay and were pressing me for certain internal refers and services I wasn't a fan of. I resigned on a Friday and opened on a Monday; however, I'd had at least a month of dead utilities + rent prior to that when arranging the office solo on my evenings/weekends off. It was a hectic couple of months of logistics before launching, but it worked well.

I did many free visits early after going solo (was not on certain plans, was not on MCA, just saw the pts from any and all payers to keep goodwill... "we accept all area plans," took walk-ins, etc). The office I resigned at fought back hard and generally did not tell patients I was still nearby, but many new pts and prior ones found my solo anyways. I did one employee to start but had to add another within a month due to demand; mine are full time salaried at around 20% over area average pay for their job type. Now, I have a totally full schedule booked a month or two out for some non-acute stuff... we now can only take same-day for pretty serious stuff or if we have a cancel spot arise.

We will obviously maintain connections and our rep/refers but largely let off on marketing going forward as we've hit all marks that we'd tried for. Expenses for this new year now in progress - the first full calendar year for the office - will be roughly $400k+ gross, roughly $200k to doc (salary + distributions)... and those are low estimates. I can post actuals around this tax time next year.

Take home points:

• It can be done. PP is very viable for podiatry. It does not take a ton of patients to be profitable. I also noticed my collections were significantly higher per pt than prior owner said they were (tells you all you need to know right there). You can take no salary the first year if you're unsure that you will be profitable, but it's wise to add a doc salary once it's clear you're profitable. You can always take more ER and inpt work if you need to in the early going (I don't refuse it... but I definitely try to take less and less, just have them f/u outpt).
• There are plenty of DPMs who do this. I know many personally. I am nobody special. All who I know doing solo PP do fair to very well, and for various reasoning (see trifecta ideas below). The only way to f*** it up is basically to defeat yourself with fraud services (audit and kicked off payers) or maybe super fancy office and grand equipment leases where your overhead sinks you before you can fill the appointment book.
• Startup office is not as expensive as one thinks (I used maybe $50k of my own money to buy supplies and pay staff and pay for credentialing and attorney work... was profitable within 3 months, paid myself back gradual, then still had end-of-year distributions above). You can stock minimal DME and supplies in the early going, and I did... now, I buy as many CAM boots and arch supports and Coban and ankle braces and whatever as I can fit in the office (inflation will only increase their cost if you wait).
• Staff and EMR and malpractice (and XR if you finance it) are the main monthly big hitters to your budget, as seen above. Exam chairs and autoclave and ultrasound are not cheap, but they're basically one-time. You can obviously go as basic or fancy as you choose. I used no financing at all (savings and cashed out IHS job 401k), but that's just personal choice not to take on any debt, use biz debit card and not credit.
• This office is done without scammy grafts, other nonsense which insurances are now clawing back on. It is also without Xray revenue (I lease in a hospital, Rx XR to them). This is just income from basic visits, injections, basic office procedures, surgery, basic DME, OTC, rare anymore to do ER or inpt consulting. There is potential for much more (DM shoes, more OTC, various in-office cash svcs, etc), but I'm just fine without it.
• It is very easy to make much more by more pt volume also... this is rougly 4.5 days/wk, 15-18pt/day, banker hours. Staff are well paid, same ones since startup. We all enjoy the flow, get our lunches, feel steady but not overworked if we have an add-on or two. We are nearly always caught up, patients are happy, PCPs are happy, and we are perpetually on a waitlist due to our good rep and results in the area.
• Second, third, etc years will obviously make much more than the first year. The office will be full consistently, office will be on all payers, kinks in system will be worked out, not have the one-time expenses of chairs and autoclave and computers and furniture and etc from starting out. However, malpractice and staff wages and EMR cost and other things will always go up (inflation, etc etc).

Biggest points to remember for docs considering PP of any kind (startup, buy in, buy out):

• You will be able to work roughly half as much (patients/day), you will be able to make twice as much (% kept vs associate work with owner minimizing your collections and taking from you), or you can choose a combo of both of those. I obviously choose about two-thirds patient load to take in roughly one-and-one-third income level of most podiatry associates.
• Much more than money, you gain the ability to control who you work with, what refers you try to gain (or refuse), choice of supplies, etc. There is no more bargaining or appealing to bosses to get those things done. There is no more asking for days off or haggling about the call schedule or any such inefficient nonsense. You obviously gain ultimate job security if you do any decent job at it. Once the solo office system is in place, you basically just need to attract and retain good people to run it along with you.
• Remember the magic trifecta of PP podiatry : good payers area, likable doc (and staff), little nearby DPM competition. Those are the main keys to success.

Again, like GreenGreen thread on buying out a retire pod doc, this is not bragging... just food for thought. Hope it helps. I can reply to questions or PM as able. 👍

Nothing like the fresh smell of freedom after being beat down by a mustache pod or a clipboard nurse.

Great work!

I'll challenge the trifecta of PP podiatry. DPM competition should not in of itself be a reason to scare someone away from PP. If you can keep your overhead down and you are likable, people will seek you out. My strongest referral base are my customers. This mantra holds true in any industry. Take care of people as if they are family and they will send you everyone they know.

PS. if you arent violating your lease, buy a stinking x-ray machine. It pays back quick and prints money within the first year. It also adds the wow factor of being a one stop shop if you can do it. I get calls asking if I have one on site and it brings in those "emergency" stubbed my toe visits right away.

 

[Feli]

Nothing like the fresh smell of freedom after being beat down by a mustache pod or a clipboard nurse.

Great work!

I'll challenge the trifecta of PP podiatry. DPM competition should not in of itself be a reason to scare someone away from PP. If you can keep your overhead down and you are likable, people will seek you out. My strongest referral base are my customers. This mantra holds true in any industry. Take care of people as if they are family and they will send you everyone they know.

PS. if you arent violating your lease, buy a stinking x-ray machine. It pays back quick and prints money within the first year. It also adds the wow factor of being a one stop shop if you can do it. I get calls asking if I have one on site and it brings in those "emergency" stubbed my toe visits right away.

I agree.

Competition is always tough. Plenty of mediocre DPMs have done well and retired pretty young+rich being the rare/only show in town, and plenty of good ones have struggled in saturated places. Podiatry is saturated almost everywhere, but some spots are still much worse than others. Even though we can beat them with better care and results, it takes a lot of time and resources for some localities. It just makes the cost of new pt acquisition (through PCPs or through marketing to public or whatever) a lot higher. PCPs, Urgent Cares, etc just don't even really want to talk to a new doc - much less change refer patterns - if they already have entrenched refers for podiatry. It can always be done, but it's an uphill battle that'll take generally take significantly more time and more energy and more money to break into the areas with well-established DPMs nearby. There is no right or wrong, but I think some areas are absolutely easier to break into faster and with less expense... others are high degree of difficulty.

XR is due to my hospital suite lease, yes... I will have one if I do a second off-site location.
Overall, it is better for visibility and convenience for me to be in the hospital suite... loses XR revenue, but easier marketing and much more natural marketing. They do basically rule out all competing services for hospital renter clinics:
"PROHIBITED USES
1. any form of testing for diagnostic or therapeutic purposes;
2. provision or operation of a laboratory (including, without limitation, a pathology laboratory or a clinical laboratory);
3. any form of diagnostic imaging services (which include, without limitation, the following testing facilities: fluoroscopy, x-ray, plain film radiography, computerized tomography (CT), ultrasound, mammography and breast diagnostics, nuclear medicine testing and magnetic resonance imaging); ..."

 

[PMG03470]

$ Expense

5,111 Malpractice
6,270 Licensing and Board Exams
436 Travel
10 Parking
790 Education, Training, CME
2,185 Fuel (doc miles)
_14, 802 expenses related to doc

1500 Legal and Accounting
35 Bank Fees
758 Insurance Office Liab
12,532 Rent
2,393 Utilities (net+ph, digi fax, emails)
2,264 Phones (Ans Svc, voice svc)
8,203 Software (EMR, AntiVir, etc)
68 Mail (shipping, stamps)
8,466 Office Supplies
38,292 Cost of Goods Sold (med supplies, incl fully stocked cabinets and closet of DME, OTC, etc not yet used)
2,616 Medications (inject, crms, etc)
_77,127 expenses related to office ongoing

410 Office Décor (desks, shelves, etc... not sure how this was so low... prob put much in Office Supplies cat)
2,265 Tools (instruments, etc)
6,958 Depreciable Assets (u/s, autoclave, exam chairs)
_9,633 expenses related to office startup

1,592 Website + FB
7,707 Marketing
_9,299 expenses related to marketing

834 Uniforms
403 Insurance Work Comp
78,661 Salaries (staff salaries + bonuses + etc)
63,268 Distributions (doc... basically the amount you have to pay yourself as you can't deduct or invest any more of it)
15,733 Medical Billing svc (% of collect... plus hourly rate for credentialing and re-cred)
6,166 Meals (50% deduct)
1,415 Entertainment (not deductible.. but fun for staff+doc)
803 Charity
25,600 Taxes
_192,883 expenses related to employees

___303,744 TOTAL


...This was not a full year above... it was roughly 9.5mo. It was a cold startup with nothing but walls and floors (no buildout, though). I did have some rep and name recognition in the city/area. I left a large group after they'd cut my pay and were pressing me for certain internal refers and services I wasn't a fan of. I resigned on a Friday and opened on a Monday; however, I'd had at least a month of dead utilities + rent prior to that when arranging the office solo on my evenings/weekends off. It was a hectic couple of months of logistics before launching, but it worked well.

I did many free visits early after going solo (was not on certain plans, was not on MCA, just saw the pts from any and all payers to keep goodwill... "we accept all area plans," took walk-ins, etc). We'd tried to have a first week to set up, but patients showed up from day 1. The first month or two was seldom full days... usually 5-10pts. The office I resigned at fought back hard and generally did not tell patients I was still nearby, but many new pts and prior ones found my solo anyways. I did one employee to start but had to add another within a month due to demand; mine are full time salaried at around 20% over area average pay for their job type. Now, I have a totally full schedule booked a month or two out for some non-acute stuff... we now can only take same-day for pretty serious stuff or if we have a cancel spot arise (which is the norm for any decent doc in the area, with exception of other podiatry offices... taking same/next day, of course).

We will obviously maintain connections and our rep/refers but largely let off on marketing going forward as we've hit all marks that we'd tried for. Expenses for this new year now in progress - the first full calendar year for the office - will be roughly $400k+ gross, roughly $200k to doc (salary + distributions)... and those are low estimates. I can post actuals around this tax time next year.

Take home points:

• It can be done. PP is very viable for podiatry. It does not take a ton of patients to be profitable. I also noticed my collections were significantly higher per pt than prior owner said they were (tells you all you need to know right there). You can take no salary the first year if you're unsure that you will be profitable, but it's wise to add a doc salary once it's clear you're profitable. You can always take more ER and inpt work if you need to in the early going (I don't refuse it... but I definitely try to take less and less, just have them f/u outpt).
• There are plenty of DPMs who do this. I know many personally. I am nobody special. All who I know doing solo PP do fair to very well, and for various reasoning (see trifecta ideas below). The only way to f*** it up is basically to defeat yourself with fraud services (audit and kicked off payers) or maybe super fancy office and buildout and grand equipment leases where your overhead sinks you before you can fill the appointment book.
• Startup office is not as expensive as one thinks (I used maybe $50k of my own money to buy supplies and pay staff and pay for credentialing and attorney work... was profitable within 3 months, paid myself back gradual, then still had end-of-year distributions above). You can stock minimal DME and supplies in the early going, and I did... now, I buy as many CAM boots and arch supports and Coban and ankle braces and whatever as I can fit in the office (inflation will only increase their cost if you wait).
• Staff and EMR and malpractice (and XR if you finance it) are the main monthly big hitters to your budget, as seen above. Exam chairs and autoclave and ultrasound are not cheap, but they're basically one-time. You can obviously go as basic or fancy as you choose. I used no financing at all (savings and cashed out IHS job 401k), but that's just personal choice not to take on any debt, use biz debit card and not credit.
• This office is done without scammy grafts, other nonsense which insurances are now clawing back on. It is also without Xray revenue (I lease in a hospital, Rx XR to them). This is just income from basic visits, injections, basic office procedures, surgery, basic DME, OTC, rare anymore to do ER or inpt consulting. There is potential for much more (DM shoes, more OTC, various in-office cash svcs, etc), but I'm just fine without it.
• It is very easy to make much more by more pt volume also... this is rougly 4.5 days/wk, 15-18pt/day, banker hours. Staff are well paid, same ones since startup. We all enjoy the flow, get our lunches, feel steady but not overworked if we have an add-on or two. We are nearly always caught up and in a good mood, run on time, patients are happy, PCPs are happy, and we are perpetually on a waitlist due to our good rep and results in the area - despite other nearby pod offices taking same day and walk-ins.
• Second, third, etc years will obviously make much more than the first year. The office schedule will be full consistently, office will be on all payers, kinks in system will be worked out, will not have the one-time expenses of chairs and autoclave and computers and furniture and etc that we had starting out. However, malpractice and staff wages and EMR cost and tax bracket other things will always go up (inflation, more income, etc etc).

Biggest points to remember for docs considering PP of any kind (startup, buy in, buy out):

• You will be able to work roughly half as much (patients/day), you will be able to make twice as much (% kept vs associate work with owner minimizing your collections and taking from you), or you can choose a combo of both of those. I obviously choose about two-thirds patient load to take in roughly one-and-one-third income level of most podiatry associates.
• Much more than money, you gain the ability to control who you work with, what refers you try to gain (or refuse), choice of supplies, etc. There is no more bargaining or appealing to bosses to get those things done. There is no more asking for days off or haggling about the call schedule or any such inefficient nonsense. You obviously gain ultimate job security if you do any decent job at it. Once the solo office system is in place, you basically just need to attract and retain good people to run it along with you.
• Remember the magic trifecta of PP podiatry : good payers area, likable doc (and staff), little nearby DPM competition. Those are the main keys to success.

Again, like GreenGreen thread on buying out a retire pod doc, this is not bragging... just food for thought. Hope it helps. I can reply to questions or PM as able. 👍

Thank you so much for this Feli It gives me confidence to do it myself. Getting ABFAS in the fall the planning to open up the next summer. May I DM you if I have other questions?

 

[Adam Smasher]

$ Expense

5,111 Malpractice
6,270 Licensing and Board Exams
436 Travel
10 Parking
790 Education, Training, CME
2,185 Fuel (doc miles)
_14, 802 expenses related to doc

1500 Legal and Accounting
35 Bank Fees
758 Insurance Office Liab
12,532 Rent
2,393 Utilities (net+ph, digi fax, emails)
2,264 Phones (Ans Svc, voice svc)
8,203 Software (EMR, AntiVir, etc)
68 Mail (shipping, stamps)
8,466 Office Supplies
38,292 Cost of Goods Sold (med supplies, incl fully stocked cabinets and closet of DME, OTC, etc not yet used)
2,616 Medications (inject, crms, etc)
_77,127 expenses related to office ongoing

410 Office Décor (desks, shelves, etc... not sure how this was so low... prob put much in Office Supplies cat)
2,265 Tools (instruments, etc)
6,958 Depreciable Assets (u/s, autoclave, exam chairs)
_9,633 expenses related to office startup

1,592 Website + FB
7,707 Marketing
_9,299 expenses related to marketing

834 Uniforms
403 Insurance Work Comp
78,661 Salaries (staff salaries + bonuses + etc)
63,268 Distributions (doc... basically the amount you have to pay yourself as you can't deduct or invest any more of it)
15,733 Medical Billing svc (% of collect... plus hourly rate for credentialing and re-cred)
6,166 Meals (50% deduct)
1,415 Entertainment (not deductible.. but fun for staff+doc)
803 Charity
25,600 Taxes
_192,883 expenses related to employees

___303,744 TOTAL


...This was not a full year above... it was roughly 9.5mo. It was a cold startup with nothing but walls and floors (no buildout, though). I did have some rep and name recognition in the city/area. I left a large group after they'd cut my pay and were pressing me for certain internal refers and services I wasn't a fan of. I resigned on a Friday and opened on a Monday; however, I'd had at least a month of dead utilities + rent prior to that when arranging the office solo on my evenings/weekends off. It was a hectic couple of months of logistics before launching, but it worked well.

I did many free visits early after going solo (was not on certain plans, was not on MCA, just saw the pts from any and all payers to keep goodwill... "we accept all area plans," took walk-ins, etc). We'd tried to have a first week to set up, but patients showed up from day 1. The first month or two was seldom full days... usually 5-10pts. The office I resigned at fought back hard and generally did not tell patients I was still nearby, but many new pts and prior ones found my solo anyways. I did one employee to start but had to add another within a month due to demand; mine are full time salaried at around 20% over area average pay for their job type. Now, I have a totally full schedule booked a month or two out for some non-acute stuff... we now can only take same-day for pretty serious stuff or if we have a cancel spot arise (which is the norm for any decent doc in the area, with exception of other podiatry offices... taking same/next day, of course).

We will obviously maintain connections and our rep/refers but largely let off on marketing going forward as we've hit all marks that we'd tried for. Expenses for this new year now in progress - the first full calendar year for the office - will be roughly $400k+ gross, roughly $200k to doc (salary + distributions)... and those are low estimates. I can post actuals around this tax time next year.

Take home points:

• It can be done. PP is very viable for podiatry. It does not take a ton of patients to be profitable. I also noticed my collections were significantly higher per pt than prior owner said they were (tells you all you need to know right there). You can take no salary the first year if you're unsure that you will be profitable, but it's wise to add a doc salary once it's clear you're profitable. You can always take more ER and inpt work if you need to in the early going (I don't refuse it... but I definitely try to take less and less, just have them f/u outpt).
• There are plenty of DPMs who do this. I know many personally. I am nobody special. All who I know doing solo PP do fair to very well, and for various reasoning (see trifecta ideas below). The only way to f*** it up is basically to defeat yourself with fraud services (audit and kicked off payers) or maybe super fancy office and buildout and grand equipment leases where your overhead sinks you before you can fill the appointment book.
• Startup office is not as expensive as one thinks (I used maybe $50k of my own money to buy supplies and pay staff and pay for credentialing and attorney work... was profitable within 3 months, paid myself back gradual, then still had end-of-year distributions above). You can stock minimal DME and supplies in the early going, and I did... now, I buy as many CAM boots and arch supports and Coban and ankle braces and whatever as I can fit in the office (inflation will only increase their cost if you wait).
• Staff and EMR and malpractice (and XR if you finance it) are the main monthly big hitters to your budget, as seen above. Exam chairs and autoclave and ultrasound are not cheap, but they're basically one-time. You can obviously go as basic or fancy as you choose. I used no financing at all (savings and cashed out IHS job 401k), but that's just personal choice not to take on any debt, use biz debit card and not credit.
• This office is done without scammy grafts, other nonsense which insurances are now clawing back on. It is also without Xray revenue (I lease in a hospital, Rx XR to them). This is just income from basic visits, injections, basic office procedures, surgery, basic DME, OTC, rare anymore to do ER or inpt consulting. There is potential for much more (DM shoes, more OTC, various in-office cash svcs, etc), but I'm just fine without it.
• It is very easy to make much more by more pt volume also... this is rougly 4.5 days/wk, 15-18pt/day, banker hours. Staff are well paid, same ones since startup. We all enjoy the flow, get our lunches, feel steady but not overworked if we have an add-on or two. We are nearly always caught up and in a good mood, run on time, patients are happy, PCPs are happy, and we are perpetually on a waitlist due to our good rep and results in the area - despite other nearby pod offices taking same day and walk-ins.
• Second, third, etc years will obviously make much more than the first year. The office schedule will be full consistently, office will be on all payers, kinks in system will be worked out, will not have the one-time expenses of chairs and autoclave and computers and furniture and etc that we had starting out. However, malpractice and staff wages and EMR cost and tax bracket other things will always go up (inflation, more income, etc etc).

Biggest points to remember for docs considering PP of any kind (startup, buy in, buy out):

• You will be able to work roughly half as much (patients/day), you will be able to make twice as much (% kept vs associate work with owner minimizing your collections and taking from you), or you can choose a combo of both of those. I obviously choose about two-thirds patient load to take in roughly one-and-one-third income level of most podiatry associates.
• Much more than money, you gain the ability to control who you work with, what refers you try to gain (or refuse), choice of supplies, etc. There is no more bargaining or appealing to bosses to get those things done. There is no more asking for days off or haggling about the call schedule or any such inefficient nonsense. You obviously gain ultimate job security if you do any decent job at it. Once the solo office system is in place, you basically just need to attract and retain good people to run it along with you.
• Remember the magic trifecta of PP podiatry : good payers area, likable doc (and staff), little nearby DPM competition. Those are the main keys to success.

Again, like GreenGreen thread on buying out a retire pod doc, this is not bragging... just food for thought. Hope it helps. I can reply to questions or PM as able. 👍

First of all, thanks for doing this, this is a truly invaluable resource to anyone looking to take the plunge. A couple of questions/observations, in no particular order.

1) According to my digital XR internal record-keeping, I personally took about 1700 projections last year. Assuming they're all 73630s (they're not) and assuming I got paid about $30 per series (yes this is accurate), that translates to about $16k collections. Which is what we paid for the upgrade from a CR system to a DR system, and the times savings alone was worth it. Of course I XR lots of stuff that my partners won't bother with, they each only did about 500 projections.

2) $6270 is a ton of money for board exams. I would ask why it cost so much, but the SDN real ones all know where $4k of it went :/

3) Kudos to you keeping overhead down. Your rent seems really cheap for a hospital building. Ditto with utilities. I know in my area legal/accounting fees would cost much more than $1500

4) marketing expenses are steep but understandable if there's lots of competition in your area, especially starting out

5) Is 78K salaries for a total of 2 employees? How did you spend $800 on uniforms? Lots of turnover and lots of new scrubs? How did you spend $6k on meals? Again, it's wonderful that you open your books to us, and I'm not suggesting you did anything wrong. I'm legitimately curious.

 

[NatCh]

You left out "$60,000 for full time Associate payroll." 😵

Welcome to the world of practice ownership.

 

[Feli]

Sure np, answers bolded

First of all, thanks for doing this, this is a truly invaluable resource to anyone looking to take the plunge. A couple of questions/observations, in no particular order.

1) According to my digital XR internal record-keeping, I personally took about 1700 projections last year. Assuming they're all 73630s (they're not) and assuming I got paid about $30 per series (yes this is accurate), that translates to about $16k collections. Which is what we paid for the upgrade from a CR system to a DR system, and the times savings alone was worth it. Of course I XR lots of stuff that my partners won't bother with, they each only did about 500 projections. ...can't have XR, not allowed in lease. I agree it pays for itself fast and is a no-brainer for any full-time pod office if allowed.


2) $6270 is a ton of money for board exams. I would ask why it cost so much, but the SDN real ones all know where $4k of it went :/ ...yes yes, rdrr. Board exams cost for me will be lower in years ahead, except in poss RRA cert year. However that amount $6.3k also includes state lic, pharma lic, DEA lic, hospital dues, etc etc. CME costs will obviously be up and down YoY.

3) Kudos to you keeping overhead down. Your rent seems really cheap for a hospital building. Ditto with utilities. I know in my area legal/accounting fees would cost much more than $1500 ...office is only 650sq ft with basic utilities incl (heat, elec, etc)... again, a tradeoff for no XR allowed. Paid no (biz) tax prep in startup year. The legal and accounting fees startup year were just attorney consults (verify my old contract was over, verify no non-compete in NM, prep for dealing with any violations/accusations nonsense by old office), HR consult (company policy, hiring/benefits), and accountant consult (corp setup, tax planning)

4) marketing expenses are steep but understandable if there's lots of competition in your area, especially starting out ...I probably overshot on marketing, but it worked very well (wait list within a few months of opening). My old office was working against me, and I needed to promote awareness to PCPs and community that I was still in the area. I did signs, newspaper ads, local movie theatre previews spot, diner menu board ad spot, professional website, token gifts for PCPs, etc. Marketing might be half in years ahead (signs last)... but we have plans for photo shoot, ongoing website updates, continue token gifts, etc. Podiatry is saturated and getting moreso every year, so if you're not growing, you're shrinking. 🙂

5) Is 78K salaries for a total of 2 employees? How did you spend $800 on uniforms? Lots of turnover and lots of new scrubs? How did you spend $6k on meals? Again, it's wonderful that you open your books to us, and I'm not suggesting you did anything wrong. I'm legitimately curious. ...$78.7k is two employees partial year, one for 9.5mo and one for 8.5mo of last year, yes (salary + bonuses, benefits, my payroll taxes, etc). Same two employees since startup. They have received raises since then... it will be over $100k for the two of them for this year in a full 12 month year (biggest chunk of my overhead - and most important part, bar none). For meals, we do weekly team lunches, office snacks and drinks, office quarterly outings (show, concert, dinner, etc), many meals of my own and me+ gf when moving in and setting up office, etc etc... all work-related and deductible (meals at 50%, entertainment not deductible). Uniforms is mostly whatever I wear (dry cleaning white coats adds up fast, scrubs, undershirts etc, sneakers, dress clothes for meetings or marketing, whatever), and I get each staff a pair of running shoes per year... Altra or Brooks or Asics of their choosing (that was nearly half of uni cost right there).

 

[air bud]

First of all, thanks for doing this, this is a truly invaluable resource to anyone looking to take the plunge. A couple of questions/observations, in no particular order.

1) According to my digital XR internal record-keeping, I personally took about 1700 projections last year. Assuming they're all 73630s (they're not) and assuming I got paid about $30 per series (yes this is accurate), that translates to about $16k collections. Which is what we paid for the upgrade from a CR system to a DR system, and the times savings alone was worth it. Of course I XR lots of stuff that my partners won't bother with, they each only did about 500 projections.

2) $6270 is a ton of money for board exams. I would ask why it cost so much, but the SDN real ones all know where $4k of it went :/

3) Kudos to you keeping overhead down. Your rent seems really cheap for a hospital building. Ditto with utilities. I know in my area legal/accounting fees would cost much more than $1500

4) marketing expenses are steep but understandable if there's lots of competition in your area, especially starting out

5) Is 78K salaries for a total of 2 employees? How did you spend $800 on uniforms? Lots of turnover and lots of new scrubs? How did you spend $6k on meals? Again, it's wonderful that you open your books to us, and I'm not suggesting you did anything wrong. I'm legitimately curious.

I thought you get the 4K back if you win your challenge.

Everybody here x-rays way too much.

 

[SM761987]

Great post! I am surprised that you had enough volume to justify 78K in staff compensation.

Do you think that you could have survived with one employee (assuming that's the compensation for 2), took on additional responsibility (sterilizing, cleaning, rooming patients, etc) and increased your own compensation?

 

[Feli]

Great post! I am surprised that you had enough volume to justify 78K in staff compensation.

Do you think that you could have survived with one employee (assuming that's the compensation for 2), took on additional responsibility (sterilizing, cleaning, rooming patients, etc) and increased your own compensation?

Definitely possible to just have a front/scheduler and do it that way... at least to a certain volume.

I know a lot of DPMs who do the "back" (rooming, HPI, cleaning, instruments, restock, autoclave) all by themselves. Many of them are even quite a few years into solo PP and just continue to do it that method for whatever reason (preference, not enough pts to justify assist, etc). The DPM who was in my current space decades did a front desk and did the back-of-the-house on his own sometimes, but he typically had both front + assistant during most days and most timespans he ran the office.

Personally, I like having an assist in the rooms and can see more pts that way. Yes, we had the volume pretty fast to the point where we were missing phone calls and walk-ins and stuff when my one employee was helping me in a room or on a break. I also find most employees have a strong leaning (and competency) to either front/reception or assistant/medical side; very few are interested or proficient in both. Unless they stay a long while, it's hard to have them well-trained and plenty of reps on both jobs.

Most of all, I prefer to mainly just do the doc stuff (dx, plan, key pt edu, procedures, admin stuff in solo) and have the MA do the rooming, cleaning, restocking, various assist, disp DME or OTC, etc stuff. I think that doc is worth up to $200/hr or even more in podiatry PP, so basically anything that can be hired out for less probably should be (same reasoning I'd never do my own billing, accounting, deep cleaning, IT beyond basic stuff, repairs beyond basics, etc etc). The fitting of DME or removing bandages or cleaning instruments or helping elderly pts with shoes/socks/chair is actually pretty time consuming if you have appointment demand you could be seeing instead. If the MA costs $200/day, you really only need to see one or two more pts per day to make it profitable to have them (my $161/visit above is very low due to startup speed bumps and will increase). It also just seems more professional to me to not have the doc rooming pts, cleaning, answering phone, etc too much themselves. I'm not above doc doing that stuff themself, it's understandable real early on, and I still do all of those things occasionally. However, to have doc do it routinely once the schedule is fuller just screams "struggling doctor" to me, or it makes it look like the office isn't very busy or in demand. If the doc is less accessible and available, pts tend to respect that, and it cuts down on time wastes (this goes for phone needs also). It is also a bit gross to be reaching into drawers or cabinets and just plain tough to handle tape or band aids once you have gloves on... 100x smoother to have MA with supplies + instruments ready and one step ahead of you.

On days my MA (or front) is off on vaca and I have just one employee, then I do the back stuff 90% myself (I have the employee who is there still room pts and clean as able), but the phones/front is their main work on days with just me plus one. Im amazed how my efficiency suffers when i don't have MA help, esp for procedures and wound care. I usually only schedule about half to 2/3 the normal pt volume on those days, and we largely avoid too many wound or procedure or immediate pre/post op or new pts on those days which are heavy on supplies or cleanup. So, I think the increased productivity from a trained MA easily pays for itself. Your base expenses like rent, EMR, malprac and other insurances, utilities, etc etc are the same if you see 10pts or 25pts and whether you work 4hr in a day or 8hr or 10hr or 0hrs. I will absolutely get a second MA if I move to a bigger space or add a second location (my current location just has two exam rooms and physical space for 2 employees max).

...Overall, I'm well aware my office has a decent amount of inefficiencies. I could have less staff or pay less or not get them lunches or work longer hours. I mainly just try to make it a place that I, and my staff, like to work... and pts get what they need. There are waaay too many medical offices that the employees (docs included) don't like going to each day, that feel understaffed, or where the staff are constantly looking for new job or more pay. The people working alongside or the doc who that job seeker supports likely have noooo idea they're on the verge of losing their scheduler or assist or manager or whatever. There was one pitiful story on WCI about a cardio doc (longtime hospital employ) considering asking the forum about giving his med assist $10k/yr or something to not go to a different job and just stay there until he retired in a few years. It was pathetic. I hear hospital employee docs complain they're understaffed often, and I hear PP employee docs complain the good assistants leave or they can't remove bad ones. As owner, you can dictate those outcomes to a much greater extent.

So sure, I could pay my staff less, see more pts/day, etc. I might consider those things if I didn't have savings going into solo, if my partner didn't have good income, or if we had kids or serious debt or etc. I just like working with happy ppl and with generally happy pts. The turnover also costs more than most offices realize... in money, but also time, happiness, stress, team chemistry. Jmo and rationale. 🙂

 

[air bud]

Hopefully you guys have figured out by now Feli is a different cat

 

[Hybrocure]

Despite his one sided relationship with ABFAS I would say Feli gives the best and most balanced takes here. It’s a hair short of AI to be honest. The essays may they be adderall or caffeine influenced are one of the only things that keep our podiatry takes as a whole somewhat legitimate and not meme territory here on SDN.

I can read basically any post of his and be like “yeah, that’s true. I don’t disagree with that and it was said in a good manner”.

Also to be completely honest posting in an open forum on your own in a profession that consists of insecure wannabe orthos who have been throwing up a facade since entering podiatry school deserves respect.

 

[MoostashPod]

Hopefully you guys have figured out by now Feli is a different cat

I don't know Feli in person, but I like his character. He provides honest opinions, from experiences, and is very straightforward. No BS. He's very upfront and that's what I like most about him. Definitely a unique cat.

 

[Feli]

$ Expenses 2024 (first full calendar year)

8,814 Malpractice
1,215 Licensing and Board Exams
1,007 Travel
100 Parking
1,910 Education, Training, CME
958 Fuel (doc miles)
_14,004 expenses related to doc

1500 Legal and Accounting
2 Bank Fees
758 Insurance Office Liab
13,858 Rent
2,979 Utilities (net+ph, digi fax, emails)
3,699 Phones (Ans Svc, voice svc)
9,065 Software (EMR, AntiVir, etc)
273 Mail (shipping, stamps)
3,318 Office Supplies
31,662 Cost of Goods Sold (med supplies)
0 Medications (inject, crms, etc... prob just had this in COGS above?)
_67,114 expenses related to office ongoing

556 Office Décor (desks, shelves, etc)
3,318 Tools (instruments, etc)
0 Depreciable Assets (u/s, autoclave, exam chairs... no new depreciable stuff)
_7,507 expenses related to office startup

2,388 Website + FB
5,119 Marketing
_7,507 expenses related to marketing

2,336 Uniforms
661 Insurance Work Comp
152,636 Salaries (staff salaries + bonuses + etc... added $41k doc w2 in 2nd yr, in 1st year doc got distrib only, doc will be $96k salary future yrs)
152,957 Distributions (doc... basically the amount you have to pay yourself as you can't deduct or invest any more of it)
26,022 Medical Billing svc (% of collect... plus hourly rate for credentialing and re-cred)
15,461 Meals (some 50%, some 100% deduct)
992 Entertainment (not deductible.. but fun for staff+doc)
747 Charity
46,480 Taxes
_398,292 expenses related to employees

___490,791 TOTAL

...avg = 176/visit (this incl post op globals $0, no pay visits, a few orthotic pickups and professional courtesy visits I usually don't charge for, etc)

Basically, cost of goods goes way down after first year (keep in mind first year at top post was 9.5mo but had to stock all supplies),
little cost for office furniture and decor and computer hardware or etc after initial year...
marketing goes down a bit (I suppose this varies on how first year goes?)... attorney down but accountant up a bit.
Rent and utilities and EMR go up a bit with inflation.
Bigtime increases in labor (keep good employees), answer service (more calls/msgs), billing as it's % based (but less cred fees)... basically all else goes up.

My hours are definitely easier now. I barely ever work weekends anymore unless it's to do a bit of shopping for the biz or maybe to clean up EMR stuff (could do at home but typically like to be in office for quiet/library effect). I worked most weekends in the startup year (every single one first few months, most weekends in 2nd half of startup year) doing stocking, ordering, setting up, doing forms, etc.

I have the same 2 employees I started with early 2023... overpaid for area (raises to ~112k/yr last year for the two as above when you count their salaries + various bonuses). They're even higher for 2025 and forward, but they're happy and highly productive and reliable (which makes my life easy). I could make a lot more for myself if I were paying them $18/hr with no bonuses or whatever the minimum for the area MA and med reception is... but having to train a new MA every 6 months or so is just not my style. Luckily, my team is small and I can overpay them and expect awesome work.

 

[Housewifey]

$ Expenses 2024 (first full calendar year)

8,814 Malpractice
1,215 Licensing and Board Exams
1,007 Travel
100 Parking
1,910 Education, Training, CME
958 Fuel (doc miles)
_14,004 expenses related to doc

1500 Legal and Accounting
2 Bank Fees
758 Insurance Office Liab
13,858 Rent
2,979 Utilities (net+ph, digi fax, emails)
3,699 Phones (Ans Svc, voice svc)
9,065 Software (EMR, AntiVir, etc)
273 Mail (shipping, stamps)
3,318 Office Supplies
31,662 Cost of Goods Sold (med supplies)
0 Medications (inject, crms, etc... prob just had this in COGS above?)
_67,114 expenses related to office ongoing

556 Office Décor (desks, shelves, etc)
3,318 Tools (instruments, etc)
0 Depreciable Assets (u/s, autoclave, exam chairs... no new depreciable stuff)
_7,507 expenses related to office startup

2,388 Website + FB
5,119 Marketing
_7,507 expenses related to marketing

2,336 Uniforms
661 Insurance Work Comp
152,636 Salaries (staff salaries + bonuses + etc... added $41k doc w2 in 2nd yr, in 1st year doc got distrib only, doc will be $96k salary future yrs)
152,957 Distributions (doc... basically the amount you have to pay yourself as you can't deduct or invest any more of it)
26,022 Medical Billing svc (% of collect... plus hourly rate for credentialing and re-cred)
15,461 Meals (some 50%, some 100% deduct)
992 Entertainment (not deductible.. but fun for staff+doc)
747 Charity
46,480 Taxes
_398,292 expenses related to employees

___490,791 TOTAL

...avg = 176/visit (this incl post op globals $0, no pay visits, a few orthotic pickups and professional courtesy visits I usually don't charge for, etc)

Basically, cost of goods goes way down after first year (keep in mind first year at top post was 9.5mo but had to stock all supplies),
little cost for office furniture and decor and computer hardware or etc after initial year...
marketing goes down a bit (I suppose this varies on how first year goes?)... attorney down but accountant up a bit.
Rent and utilities and EMR go up a bit with inflation.
Bigtime increases in labor (keep good employees), answer service (more calls/msgs), billing as it's % based (but less cred fees)... basically all else goes up.

My hours are definitely easier now. I barely ever work weekends anymore unless it's to do a bit of shopping for the biz or maybe to clean up EMR stuff (could do at home but typically like to be in office for quiet/library effect). I worked most weekends in the startup year (every single one first few months, most weekends in 2nd half of startup year) doing stocking, ordering, setting up, doing forms, etc.

I have the same 2 employees I started with early 2023... overpaid for area (raises to ~112k/yr last year for the two as above when you count their salaries + various bonuses). They're even higher for 2025 and forward, but they're happy and highly productive and reliable (which makes my life easy). I could make a lot more for myself if I were paying them $18/hr with no bonuses or whatever the minimum for the area MA and med reception is... but having to train a new MA every 6 months or so is just not my style. Luckily, my team is small and I can overpay them and expect awesome work.

How am I collecting 45$ for nails lol.... I need to move south. What is your office diversity? Plantar fasciitis/msk etc, ingrowns, wounds etc. My 99213 for my local BCBS is $81.

 

[Homo sapien]

$ Expenses 2024 (first full calendar year)

8,814 Malpractice
1,215 Licensing and Board Exams
1,007 Travel
100 Parking
1,910 Education, Training, CME
958 Fuel (doc miles)
_14,004 expenses related to doc

1500 Legal and Accounting
2 Bank Fees
758 Insurance Office Liab
13,858 Rent
2,979 Utilities (net+ph, digi fax, emails)
3,699 Phones (Ans Svc, voice svc)
9,065 Software (EMR, AntiVir, etc)
273 Mail (shipping, stamps)
3,318 Office Supplies
31,662 Cost of Goods Sold (med supplies)
0 Medications (inject, crms, etc... prob just had this in COGS above?)
_67,114 expenses related to office ongoing

556 Office Décor (desks, shelves, etc)
3,318 Tools (instruments, etc)
0 Depreciable Assets (u/s, autoclave, exam chairs... no new depreciable stuff)
_7,507 expenses related to office startup

2,388 Website + FB
5,119 Marketing
_7,507 expenses related to marketing

2,336 Uniforms
661 Insurance Work Comp
152,636 Salaries (staff salaries + bonuses + etc... added $41k doc w2 in 2nd yr, in 1st year doc got distrib only, doc will be $96k salary future yrs)
152,957 Distributions (doc... basically the amount you have to pay yourself as you can't deduct or invest any more of it)
26,022 Medical Billing svc (% of collect... plus hourly rate for credentialing and re-cred)
15,461 Meals (some 50%, some 100% deduct)
992 Entertainment (not deductible.. but fun for staff+doc)
747 Charity
46,480 Taxes
_398,292 expenses related to employees

___490,791 TOTAL

...avg = 176/visit (this incl post op globals $0, no pay visits, a few orthotic pickups and professional courtesy visits I usually don't charge for, etc)

Basically, cost of goods goes way down after first year (keep in mind first year at top post was 9.5mo but had to stock all supplies),
little cost for office furniture and decor and computer hardware or etc after initial year...
marketing goes down a bit (I suppose this varies on how first year goes?)... attorney down but accountant up a bit.
Rent and utilities and EMR go up a bit with inflation.
Bigtime increases in labor (keep good employees), answer service (more calls/msgs), billing as it's % based (but less cred fees)... basically all else goes up.

My hours are definitely easier now. I barely ever work weekends anymore unless it's to do a bit of shopping for the biz or maybe to clean up EMR stuff (could do at home but typically like to be in office for quiet/library effect). I worked most weekends in the startup year (every single one first few months, most weekends in 2nd half of startup year) doing stocking, ordering, setting up, doing forms, etc.

I have the same 2 employees I started with early 2023... overpaid for area (raises to ~112k/yr last year for the two as above when you count their salaries + various bonuses). They're even higher for 2025 and forward, but they're happy and highly productive and reliable (which makes my life easy). I could make a lot more for myself if I were paying them $18/hr with no bonuses or whatever the minimum for the area MA and med reception is... but having to train a new MA every 6 months or so is just not my style. Luckily, my team is small and I can overpay them and expect awesome work.

Hellyeah. I'm glad it's working for you and I like what you do for your employees

 

[Homo sapien]

$ Expenses 2024 (first full calendar year)

8,814 Malpractice
1,215 Licensing and Board Exams
1,007 Travel
100 Parking
1,910 Education, Training, CME
958 Fuel (doc miles)
_14,004 expenses related to doc

1500 Legal and Accounting
2 Bank Fees
758 Insurance Office Liab
13,858 Rent
2,979 Utilities (net+ph, digi fax, emails)
3,699 Phones (Ans Svc, voice svc)
9,065 Software (EMR, AntiVir, etc)
273 Mail (shipping, stamps)
3,318 Office Supplies
31,662 Cost of Goods Sold (med supplies)
0 Medications (inject, crms, etc... prob just had this in COGS above?)
_67,114 expenses related to office ongoing

556 Office Décor (desks, shelves, etc)
3,318 Tools (instruments, etc)
0 Depreciable Assets (u/s, autoclave, exam chairs... no new depreciable stuff)
_7,507 expenses related to office startup

2,388 Website + FB
5,119 Marketing
_7,507 expenses related to marketing

2,336 Uniforms
661 Insurance Work Comp
152,636 Salaries (staff salaries + bonuses + etc... added $41k doc w2 in 2nd yr, in 1st year doc got distrib only, doc will be $96k salary future yrs)
152,957 Distributions (doc... basically the amount you have to pay yourself as you can't deduct or invest any more of it)
26,022 Medical Billing svc (% of collect... plus hourly rate for credentialing and re-cred)
15,461 Meals (some 50%, some 100% deduct)
992 Entertainment (not deductible.. but fun for staff+doc)
747 Charity
46,480 Taxes
_398,292 expenses related to employees

___490,791 TOTAL

...avg = 176/visit (this incl post op globals $0, no pay visits, a few orthotic pickups and professional courtesy visits I usually don't charge for, etc)

Basically, cost of goods goes way down after first year (keep in mind first year at top post was 9.5mo but had to stock all supplies),
little cost for office furniture and decor and computer hardware or etc after initial year...
marketing goes down a bit (I suppose this varies on how first year goes?)... attorney down but accountant up a bit.
Rent and utilities and EMR go up a bit with inflation.
Bigtime increases in labor (keep good employees), answer service (more calls/msgs), billing as it's % based (but less cred fees)... basically all else goes up.

My hours are definitely easier now. I barely ever work weekends anymore unless it's to do a bit of shopping for the biz or maybe to clean up EMR stuff (could do at home but typically like to be in office for quiet/library effect). I worked most weekends in the startup year (every single one first few months, most weekends in 2nd half of startup year) doing stocking, ordering, setting up, doing forms, etc.

I have the same 2 employees I started with early 2023... overpaid for area (raises to ~112k/yr last year for the two as above when you count their salaries + various bonuses). They're even higher for 2025 and forward, but they're happy and highly productive and reliable (which makes my life easy). I could make a lot more for myself if I were paying them $18/hr with no bonuses or whatever the minimum for the area MA and med reception is... but having to train a new MA every 6 months or so is just not my style. Luckily, my team is small and I can overpay them and expect awesome work.

Also are your staff all salary + bonus or hourly at a high rate

 

[Feli]

Also are your staff all salary + bonus or hourly at a high rate

They're both salary... small sign bonus, bonuses ongoing for OTC monthly sales %, retire bonus annually, holiday bonus annual, annual productivity (% of profits for whole office), can cash out unused vaca/sick days, little bonuses for busy days, etc. Prob more bonuses than most podiatry associates.

I'm too lazy to do the punch in/out thing. I would get sick of that real fast... "I forgot to punch back in after lunch," milking the clock staying doing nothing, etc.
I mainly think salary treats them more like real adults (you do have to pay them at least $36k/yr or so ... and write job descrips to make them exempt vs non-exempt... aka decision makers).

 

[footpainhealer]

so your expenses are 500k.

is your gross revenue (actual paid invoices/reimbursed charges/etc) well over that or are you bringing in around 500K and taking all the leftover at distribution?

I see your paying yourself 41K plus your owner distribution so you essentially made 193K if I am reading that correctly?

 

[Feli]

so your expenses are 500k.

is your gross revenue (actual paid invoices/reimbursed charges/etc) well over that or are you bringing in around 500K and taking all the leftover at distribution?

I see your paying yourself 41K plus your owner distribution so you essentially made 193K if I am reading that correctly?

Eh, gross income is a bit under 500k, yeah.
As for my net, that's the basic of it 193k dividends +41k salary (for year 2... was a lot less in year 1).*
Expenses were whatever they were... 491k - my income (234k) = overhead aka deductions (257k aka 52%)

*The income is a bit more complicated in solo/owner, though. When you run S-corp, quite a few things can be a deduction, so you can work a fair bit of things also. Not going to post a whole lot on that, but it's pretty common sense (trips for work might also have fun stuff same days, shoes or jacket or etc bought for work might also be worn elsewhere, meal after gym might be biz expenses as you had done some office work before gym, etc).

I am paying myself $96k salary from here on. I would've done that sooner, but wanted to assure consistent profit... that's about the sweet spot for most owner docs/CRNA/professionals/etc to do as the w2 portion (the rest as dividends). It maxes out social security benefits "bend points," which change annual but it's about 88k right now. That also gets you to the low end of peer podiatrist incomes for same taxonomy code status... basically in order to avoid audits.

 

[Hybrocure]

Eh, gross income is a bit under 500k, yeah.
As for my net, that's the basic of it 193k dividends +41k salary (for year 2... was a lot less in year 1).*
Expenses were whatever they were... 491k - my income (234k) = overhead aka deductions (257k aka 52%)

*The income is a bit more complicated in solo/owner, though. When you run S-corp, quite a few things can be a deduction, so you can work a fair bit of things also. Not going to post a whole lot on that, but it's pretty common sense (trips for work might also have fun stuff same days, shoes or jacket or etc bought for work might also be worn elsewhere, meal after gym might be biz expenses as you had done some office work before gym, etc).

I am paying myself $96k salary from here on. I would've done that sooner, but wanted to assure consistent profit... that's about the sweet spot for most owner docs/CRNA/professionals/etc to do as the w2 portion (the rest as dividends). It maxes out social security benefits "bend points," which change annual but it's about 88k right now. That also gets you to the low end of peer podiatrist incomes for same taxonomy code status... basically in order to avoid audits.

Post workout meals is awesome

 

[SubungualDebris]

Yeah, that's the basic of it (for year 2... was a lot less in year 1).
When you run S-corp, quite a few things can be a deduction, so you can work a fair bit of things also. Not going to post a whole lot on that, but it's pretty common sense (trips for work might also have fun stuff same days, shoes or jacket or etc bought for work might also be worn elsewhere, meal after gym might be biz expenses as you had done some office work before gym, etc).

I am paying myself $96k salary from here on. I would've done that sooner, but wanted to assure consistent profit... that's about the sweet spot for most owner docs/CRNA/professionals/etc to do as the w2 portion (the rest as dividends). It maxes out social security benefits "bend points," which change annual but it's about 88k right now. That also gets you to the low end of peer podiatrist incomes for same taxonomy code status... basically in order to avoid audits.

This is interesting. I paid myself 121,200 as W2. My rationale was that if I get audited, this is literally what Podiatrists at VAs are starting at and it's public information. The rest I took as distribution. I would think being sub 100k would put you at greater risk for being audited, but have no data to back this up. Does that every concern you?

As much as I wanted to pay myself 30-40% of my profits in salary and take the rest in distributions, my fear of getting audited got the better of me.

Do you have a solo 401k? I like the idea of paying myself a little more W2 salary, that way I can contribute more to my solo 401k (max contribution employer can make to 401k is 25% of W2 salary). In order to max 401k contributions as an employer W2 salary would have to be 188k-ish. My issue is I don't want to pay the social security wage base limit lol which I think caps out at 176k If i recall correctly.

 

[Adam Smasher]

I (finally) converted to an S-corp, my accountant researched this and said I should pay myself $84k salary.

 

[Homo sapien]

I (finally) converted to an S-corp, my accountant researched this and said I should pay myself $84k salary.

Is this an accountant you all have on retainer or one you pay fee per service

 

[Adam Smasher]

Is this an accountant you all have on retainer or one you pay fee per service

my practice has been doing business with their firm for a looong time, so we have enough good will built up that they don't charge retainer fees, we just pay by billable hour.

And reading between the lines, I can tell this wasn't what you were getting at. No one has to be like me if they don't like how I do things.

 

[Homo sapien]

my practice has been doing business with their firm for a looong time, so we have enough good will built up that they don't charge retainer fees, we just pay by billable hour.

And reading between the lines, I can tell this wasn't what you were getting at. No one has to be like me if they don't like how I do things.

What? I wasn't getting at anything. I just didn't know if people keep particular accountants on tap like particular coworkers you hire/etc; how people find them

 

[heybrother]

I don't know where this was going but if you read the anesthesia or ED forum there's an extensive argument across that forum over what is acceptable underlying salary with enormous variations across accountants.

my practice has been doing business with their firm for a looong time, so we have enough good will built up that they don't charge retainer fees, we just pay by billable hour.

And reading between the lines, I can tell this wasn't what you were getting at. No one has to be like me if they don't like how I do things.

 

[Homo sapien]

I don't know where this was going but if you read the anesthesia or ED forum there's an extensive argument across that forum over what is acceptable underlying salary with enormous variations across accountants.

I wasn't even thinking about the listed salary. I just was wondering how people retained/got their accountant or other business associated people

 

[Adam Smasher]

I wasn't even thinking about the listed salary. I just was wondering how people retained/got their accountant or other business associated people

sorry, I thought you were insinuating something about who we've had keeping our books.

Anyway, you find/pay an accountant much the same as your lawyer. You will probably not need to put down a retainer but you pay per billable hour. A solo dpm office opening its doors is going to have very simple bookkeeping and very simple tax prep so accounting costs will be relatively low.

 

[Homo sapien]

sorry, I thought you were insinuating something about who we've had keeping our books.

Anyway, you find/pay an accountant much the same as your lawyer. You will probably not need to put down a retainer but you pay per billable hour. A solo dpm office opening its doors is going to have very simple bookkeeping and very simple tax prep so accounting costs will be relatively low.

That 2nd paragraph is what I was asking As- you open and just look for a business accountant and pay them to accountancy for you as needed

 

[dtrack22]

I don't know where this was going but if you read the anesthesia or ED forum there's an extensive argument across that forum over what is acceptable underlying salary with enormous variations across accountants.

I don’t know how big of a deal your reported “salary” is in terms of $ amount. My understanding is that the red flag is the ratio of salary to dividend (C corp)/distribution (S corp).

Never heard of a hard and fast number but basically, two people who pay themselves $80k salary aren’t viewed the same when one is taking $150k distribution and the other $250k. The latter is the one that’s gonna have the IRS at their door. Well, maybe not for long…we can only hope…

 

[Feli]

This is interesting. I paid myself 121,200 as W2. My rationale was that if I get audited, this is literally what Podiatrists at VAs are starting at and it's public information. The rest I took as distribution. I would think being sub 100k would put you at greater risk for being audited, but have no data to back this up. Does that every concern you?

As much as I wanted to pay myself 30-40% of my profits in salary and take the rest in distributions, my fear of getting audited got the better of me.

Do you have a solo 401k? I like the idea of paying myself a little more W2 salary, that way I can contribute more to my solo 401k (max contribution employer can make to 401k is 25% of W2 salary). In order to max 401k contributions as an employer W2 salary would have to be 188k-ish. My issue is I don't want to pay the social security wage base limit lol which I think caps out at 176k If i recall correctly.

Yeah, I think the general wisdom is to do roughly 50/50 salary/distributions when you're lower income.... or do low end of avg wage for your profession as salary with the rest distributions once you make more. Most of you guys probably have higher overall income than I do as you make more and/or work more (I see ~250pt/month typically).

I know a few of CRNA (and podiatrists) that do the 84k salary thing and have for years. It's all about being in the range for your IRS taxonomy codes. No IRS issues... they aren't BS-ing anything, just not trying to pay more SS/MCR tax than needed. Audits aren't the end of the world if you have QBooks and good records - but still not awesome I'm sure.

Upside to more salary is more social sec money (but that diminishes greatly after the ~88k bend point, only 15% counts - not 32%), and that you can put more into solo 410k if you have more salary.
I looked into solo 401k, accountant suggested it, and it's smart for most, but I don't do it personally... I just do backdoor Roth and then cash stock account and cash MM savings, but my retirement is a bit different from most as my partner has a lot more than me in 401k and her company stock (so I want more flexibility on my retirement stuff - ability to use at younger age without penalties - and more taxes-paid invest accounts as we may retire early-ish, no kids).

 

[Silly Willy DPM]

Hey Feli thank you for the post. I’m thinking about opening my on PP. Would love to ask you some questions. If you are willing please shoot me a private message. Thank you!!

 

[Feli]

Hey Feli thank you for the post. I’m thinking about opening my on PP. Would love to ask you some questions. If you are willing please shoot me a private message. Thank you!!

Sure, you can PM me questions. There are a handful of regular users here who've started or bought and run their own PP.