Opening Assessment Practice Questions!

jadezomb

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Hi everyone,

I've been thinking about long-term goals lately.

I would love to eventually (3-5 years out maybe) open up my own testing practice. I'm a generalist, so I would need to purchase materials for adults/kids/a wide array of testing referral questions such as ASD, ADHD, LDs, and personality measures.

For those of you that have done this, what were your start up costs/concerns like? I am shying away from the idea of accepting insurance.

I'm in a large metro area :)

Thanks in advance for any tips/thoughts you have!
 

MamaPhD

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Hi everyone,

I've been thinking about long-term goals lately.

I would love to eventually (3-5 years out maybe) open up my own testing practice. I'm a generalist, so I would need to purchase materials for adults/kids/a wide array of testing referral questions such as ASD, ADHD, LDs, and personality measures.

For those of you that have done this, what were your start up costs/concerns like? I am shying away from the idea of accepting insurance.

I'm in a large metro area :)

Thanks in advance for any tips/thoughts you have!

Remember the importance of relationships with your referral sources - primary care, pediatricians, private schools, etc. Remember that you are serving them as well as the people they refer to you. Behave accordingly - network regularly, make their lives easy, never make your referral sources chase you down for a report, do a good job for their patients/clients, make yourself available by phone/text/email. Make your referral sources look bad and your referrals will dry up quickly unless you are in an underserved area (unlikely if you're running a fee-for-serve practice).
 
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PsyDr

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This is likely over ambitious.

1) Start up costs for an office (3-6 months rent, NNN, liability insurance for the office, malpractice insurance, contract grade furniture with ADA stuff including big person chairs, telephone, internet, computers, software, and god help you if you get a website in California cause we are now into ADA compliant websites, etc). Let's call it $20-40k. Add in some bare bone test kits for about $5-10k (e..g, WAIS+ MMPI+ CPT= $5k). Now, add in looking the part, if you're cash based.

2) Now let's go with WHY someone would want to pay YOU cash. If you're in a major city, there are psychologists who will provide the desired services using insurance.

Imagine this situation: I'm JOE BLOW with acme insurance. I make $150k/yr. Enough to cover stuff and have extra, but not enough to fly to the world leading expert. Got a kid who isn't doing well. Now I'm looking at the options for how to get my kid an assessment:

A. I can see if the school will do it for free. But they're slow, and probably not the best.
B. I can call my insurance company, find providers, call around, see who is available, and make appointments. I'll have a 20% deductible, which we will call $200.
C. I can ask friends and family members who is awesome. Who is established. Who is experienced (I know, experience is a stupid metric, but people like it). See what the price is. When they can see my kid. Since I'm paying $2000-8000, I'm inclined to try to get the best I can afford.

Where do you fit into that model? What is your market? What makes someone choose you over more experienced or cheaper options? If you don't have a great answer to this, you're sunk.
 
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Dr. Melfi

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You may want to partner with an established psychologist who has the space and testing materials, at least in the beginning since it is so costly. From there you can build your own library of materials slowly while still accruing an income to support you.
 
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Sanman

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You may want to partner with an established psychologist who has the space and testing materials, at least in the beginning since it is so costly. From there you can build your own library of materials slowly while still accruing an income to support you.


I'd disagree with this, you want to partner with someone that has the space, but not the testing materials. Why would a someone that already has both need someone with nothing to offer beyond an employee level of knowledge? Having done this as part of my previous job negotiations, you want someone with the space and capital but not the knowledge to let you build out the testing component to a practice that already does therapy or med management. Just make sure you can negotiate a equitable agreement for yourself if you are building a part of the business for them.
 
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foreverbull

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Along the lines of what @PsyDr said, school districts do this for free via school psychologists. Yes, it might take some time on a waiting list, but there’s a big difference between completely free plus recommendations and an IEP in the schools vs. completely out of pocket and little to no consultation with the school system.

What would you offer that would make it attractive other than completing it quickly, and why would someone choose you over a psychologist with a well-established assessment practice? You want to be able to answer these questions if you pursue this path.

Not to discourage you, because some communities are high enough SES to pay the fees to get the testing done ASAP (may involve longer commutes to these places) but figuring out how to tap the market is a challenge, especially if there is already established competition. Not many folks need formal assessment, so knowing how to make connections is huge, as well as preparing for years of doing other practice-related things to bridge the gap in practice while you build your referral network and reputation. I know someone who has been building an assessment practice on her own without connections for years and has had to provide other services to make ends meet. She has also teamed up with other clinicians in a group practice to hopefully have a built-in referral network eventually (the other clinicians don’t provide assessment).

But initially, you’d likely want to plan for a slow enough build that you need to either provide therapy as well or work part-time elsewhere for at least a few years after launching.
 
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erg923

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I am a psychologist, and I would probably prefer: 1 someone takes my insurance. 2. something that I know could translates into an IEP and someone who is working with the school to do this.

Also, most psychiatric disorders do not need psychological tests to diagnose or plan treatment. I would be wary that if you open a "testing practice" everything/everyone can become a nail that needs your hammer, when this is simply not the case. I see this happen all the time.
 
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PsyDr

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To be clear:

My advice isn't meant to discourage. It's meant to educate about what is being asked. I'm all for people increasing the quality of how psychology is being played. As far as I know there is a lack of intersection between business schools and clinical psychology. All of my questions CAN be answered. OP might have awesome responses. For all I know, he/she could be a national expert, come from a family with incredible connections, have an insight into market inefficiencies, etc.

You'd run, if you saw a guy who wants you to invest in opening a restaurant, "because everyone loves my cooking".

You'd consider investing with a restaurateur who brings in a market analysis showing area wide income/competition at that type of food and price point/similar business failures in the area, estimates of how many many times you can turn over seats, estimates of daily cost to stay open including staffing/insurance/food costs/liquor/licensing, a credit score in the 800s, estimated ROI with timeframe, a track record, etc.


And X1000000000000 for what @BuckeyeLove said. Psychologists can be incredibly unethical in their hiring practices. Scumbags.
 
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ClinicalABA

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... Add in some bare bone test kits for about $5-10k (e..g, WAIS+ MMPI+ CPT= $5k)...

As PsyDr said earlier in the quoted post- these are likely ambitious numbers. The test kits alone that you would need to appropriately conduct ASD evals with kids just ages 1-5 would run you ~$6500 (not including protocols, scoring programs. etc.). This includes: ADOS-2; Bayley-4 (cog and language assessment for 1-3y.o.); WPPSI-IV (cog 3-5y.o.); PLS-5 (language 3-5 y.o.), and NPPYS-2 ("fill in the gaps" stuff for 3-5 y.o.- you could skip this and save 1k, but once you start skipping stuff you are providing less of a product than what others do). This doesn't include standardized questionnaires, and you'd probable need a good arsenal of those.
 
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futureapppsy2

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As PsyDr said earlier in the quoted post- these are likely ambitious numbers. The test kits alone that you would need to appropriately conduct ASD evals with kids just ages 1-5 would run you ~$6500 (not including protocols, scoring programs. etc.). This includes: ADOS-2; Bayley-4 (cog and language assessment for 1-3y.o.); WPPSI-IV (cog 3-5y.o.); PLS-5 (language 3-5 y.o.), and NPPYS-2 ("fill in the gaps" stuff for 3-5 y.o.- you could skip this and save 1k, but once you start skipping stuff you are providing less of a product than what others do). This doesn't include standardized questionnaires, and you'd probable need a good arsenal of those.
Also, you’ll want a good non-verbal cognitive as well.
 
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PsyDr

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I think this thread is doing a great job of illustrating why:

1. It is difficult to open up a new practice early in your career

2. Why student loan debt is so bad and can lead to being exploited the rest of your career


I think this thread illustrates:

1. How the reliance upon traditional practice models leaves the market wide open for innovation. (People tend to make money when everyone else is doing the same thing).

2. How much the APA could accomplish if they defined an EXACT percentage of collections as being unethical/exploitative. And the same for whatever tuition people are crazily charging these days.
 
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Sanman

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I think this thread illustrates:

1. How the reliance upon traditional practice models leaves the market wide open for innovation. (People tend to make money when everyone else is doing the same thing).

2. How much the APA could accomplish if they defined an EXACT percentage of collections as being unethical/exploitative. And the same for whatever tuition people are crazily charging these days.


I'd say that #1 is the advanced class and #2 ain't gonna happen.
 

psychlife19

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To add to this, I did a practicum in a child testing private practice. My supervisor accepted insurance and we had a lot of kids from the nearby Christian schools. So if you are wanting kids who might do private pay and where they wouldn’t get tested free by the school psych, check out how many private schools are in the area? Just an idea!
 

ClinicalABA

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Also, you’ll want a good non-verbal cognitive as well.
Yep- and a Leiter will run you another 1200 bucks.

OP- As others have emphasized, these aren't all admonishments not to do it, but just to be fully prepared. You can "build it" and they may not come.
 
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beginner2011

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I think this thread illustrates:

1. How the reliance upon traditional practice models leaves the market wide open for innovation. (People tend to make money when everyone else is doing the same thing).

2. How much the APA could accomplish if they defined an EXACT percentage of collections as being unethical/exploitative. And the same for whatever tuition people are crazily charging these days.
I'd say that #1 is the advanced class and #2 ain't gonna happen.
I'd be happy to ride the coat tails of some ECP who comes up with an innovative practice model!
Me too... I have been working to crack that nut in my spare time.

I'd love to have a candid discussion about this in another thread...For example, I think with COVID forcing a shift to tele services there will likely be sizable changes in the market. Would love to talk more about changes in demand/operating costs/etc.
 

erg923

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To add to this, I did a practicum in a child testing private practice. My supervisor accepted insurance and we had a lot of kids from the nearby Christian schools. So if you are wanting kids who might do private pay and where they wouldn’t get tested free by the school psych, check out how many private schools are in the area? Just an idea!

My understanding is that FPL 94-142 requires school systems to identify and provide adequate services for children with disabilities. My understanding is that just because one has chosen to enroll their child in private school does not negate this? I am pretty sure this can still be requested and should be required (technically) to be the burden of the local public school system/district? I have 3 children enrolled in Catholic school, but we have been able to talk to and get some services via the local public school system about just this issue. Although, admittedly, it wasn't for a psychological/psychoeducational testing evaluation.
 
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jadezomb

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Thanks for the responses so far everyone! I'm not discouraged, don't worry-- just trying to learn about options for my career and build some long-term goals! I have some colleagues that have opened their own practices lately (primarily therapy though) and that has piqued my interest.

Also, I am definitely open to accepting insurance. However, in my area insurance tends not to cover full assessments anyway, weirdly enough. Or they will offer a meager amount that would not reflect the time and effort spent (to the tune of a couple hundred dollars).
 

erg923

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Thanks for the responses so far everyone! I'm not discouraged, don't worry-- just trying to learn about options for my career and build some long-term goals! I have some colleagues that have opened their own practices lately (primarily therapy though) and that has piqued my interest.

Also, I am definitely open to accepting insurance. However, in my area insurance tends not to cover full assessments anyway, weirdly enough. Or they will offer a meager amount that would not reflect the time and effort spent (to the tune of a couple hundred dollars).

What is a "full assessment?"

A "full assessment" depends on the referral question and, often, medical necessity criteria. If you are expecting 5- 8 hours of testing hours to be approved for most every assessment/patient you see....that's NOT gonna happen with insurance. Nor should it. I actually don't agree that it's "weirdly enough." "Full assessments" (if you mean 6-8 hours of testing services) will not be needed for most patients. This would, of course, be cost prohibitive for our healthcare system.

Many patients will need very little "testing" (that is billable), some will certainly need some hours in order to diagnose and/or reasonably treatment plan to the standard of care. Very few will actually need 8 hours or more unless you are running a very specific neuropsych, ASD, or forensic specialty practice.
 
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jadezomb

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What is a "full assessment"?

A "full assessment" depends on the referral question and, often medical necessity criteria. If you are expecting 5- 8 of testing hours to be approved for most every assessment/patient you see....that's NOT gonna happen with insurance. Nor should it.

Got it! For example, if a case warranted a full battery of assessments that covers multiple areas of functioning (e.g. cognitive, developmental, personality) to clarify the diagnosis.
 

PsyDr

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@Sanman I don’t think it will be us that innovates. It will be some ECP.

@beginner2011 once you learn HOW money is made in this field, you’re open to innovate. You can ask all you want, but the answer probably doesn’t exist. The reason forensics is profitable, is that attorneys have the money and need for our services. There have to be other opportunities out there.

@jadezomb if you’re doing kids‘ LD stuff, the difference might be that insurance doesn’t pay for academic testing. Some people have to contract with patients to privately pay for The uncovered parts.
 
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erg923

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Got it! For example, if a case warranted a full battery of assessments that covers multiple areas of functioning (e.g. cognitive, developmental, personality) to clarify the diagnosis.

Then its your job to articulate why that is needed to the primary paying source.

You (or your staff) will need to provide very specific clinical documentation of such. And why no one else can do that (psychiatric evaluation, developmental pediatrician, pediatric/adult neurologist, a standard course of treatment if there has been no treatment failures) to treat the patient. Of course, this happens. I'm not sure it occurs as much as you may want it to to build a business model around it?

Again, I think the predominate advice is to NOT make every nail need a particular hammer.
 
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ClinicalABA

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@jadezomb if you’re doing kids‘ LD stuff, the difference might be that insurance doesn’t pay for academic testing. Some people have to contract with patients to privately pay for The uncovered parts.
Yep! kids over five (i.e. kindergarten age and older) insurance won't cover things that are the school's responsibility (including cognitive testing). We charge an "Educational Fee." Sometimes the school will pay, but often they won't. We won't use testing from others (e.g. school psychologist or school based psychologist-HSP), and the fee is large enough where most of our families can't pay. We lose a lot of these clients.
 
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foreverbull

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Yep! kids over five (i.e. kindergarten age and older) insurance won't cover things that are the school's responsibility (including cognitive testing).

This reminds me of a colleague in my area who used to take insurance for assessment but said that it was such a time-consuming headache to get even partial reimbursement that she just gave up because she was spending so much time trying to get reimbursed that the fee was no longer worth it when she could use that time to see therapy clients instead. I believe she still might do occasional assessment out of pocket but therapy ended up being a more stable source of income for her.
 
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