Sushirolls

Topped with salmon, avocado and tobiko
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Feb 24, 2010
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My overly honest time description is rife for improvement. I will be more efficient as the the demand for efficiency increases. I'll eventually be on SDN less. Early on with any practice there are learning curves and work flows that need to be worked out. This thread should help some of those things be stream lined for folks. But if people are only looking for 1-2 days of work, only do a cash practice. If you want more days do cash or insurance. But a low volume few hours insurance practice will be a disproportionate time suck, unless you restrict it to one maybe two insurance companies.

In summary, don't let my description of time spent be a barrier to your private practice entry, I am quite confident most every other person who does this is fully capable of dialing down the admin fluff to a true bare minimum.

Conversely, when I was with Big Box shops there were still time sucks of meetings, clinical notes/faxes/PAs/call backs, etc or charting burdens that sucked up more time outside the office. Very few people practice in a way where after the patient encounter there is minimal to do after that.

I have no intention to go back to a big box shop and don't anticipate the future of this practice being a time suck as years roll on.
 

clausewitz2

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Aaaaaaaand this is discouraging again, lol. I do realize building a practice from the ground requires a lot of admin work, but 25+ hours per week towards the end of the second year sounds awful. It's probably not as bad as it sounds as your post seems very comprehensive and maybe during/after 4th year I'll feel different, but that much time on admin for an outpatient practice would not be something I think I could maintain. Thank you again for this thread though, it really is an awesome resource and I've learned a ton about the non-clinical aspects of outpatient psych. Hope things keep growing and improving and that you're enjoying the freedom from the big boxes!
This is very much at the tail end of the distribution of admin time: clinical time ratios. It is not strictly speaking a necessary thing. In my worst weeks admin-wise I probably have the inverse ratio, honestly.
 
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trophyhusband

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Sep 8, 2009
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Hello all, since SDN has been so useful over the years my wife would like to contribute to this discussion. I’ll probably update quarterly for a bit but no promises so I’ll just add this to Sushi’s post and not start a whole new one. Below is going to be a fairly long writeup about starting a cash practice so I’ll post the financial info separately so you can just skip to the next post if you’re not interested.

Late last year there were discussions at my wife’s work about changes to how her current place of work will be run. There were several changes but the big one is that in August of 2021 they will now start accepting insurance payments (and Medicaid) vs the capitated system with small patient fees at point of service they had always used in the past. There are currently no discussions about tracking productivity and whatnot but you know that’s coming eventually.

The other main issue with her current job is that some of you might remember from my last posts on here that she was negotiating a much higher salary than the doc she was replacing. She was successful but there is another doc who has been there for 16 years. This doc’s schedule is always less full than hers and let’s say the patient interactions are problematic so she receives a lot of transfers from said doc. She found out that this doctor’s salary was bumped up to the same as her salary when she was hired on… so she essentially negotiated for both of them and the other doc does much less work.

At this point I convinced her to start a small half day a weekend CAP cash practice (in her current job she only sees adults). I’ve been telling her for years that she should start her own practice because she bureaucracy chafes her and she doesn’t really like having to answer to a boss. This above change and the realization that she was making the same as the other doc finally spurred her into action.

Starting the Practice

We started doing the legwork of building the practice in September of 2020. She filed for an LLC and we purchased a domain for her website (luckily city name + psychiatry.com was available) and I built the site over a weekend. That was an interesting experience since I’ve never done it but based on @RomanticScience’s advice via PM’s (both he and this post of Sushi’s were tons of help) I was able to use Google Sites to build it fairly quickly… attaching it to the domain was not as intuitive as I would have hoped but I figured it out eventually. I was also able to used Google’s auto attendants to set up a phone tree that seems to work fairly well.

She was able to find a small office that only costs $250 per month and has 3 year options to re-up at 3% increases. Her furniture was bought fairly cheaply and the only real office equipment is a computer, wifi/router combo, and a printer/scanner. Buy your own router/wifi that works with your cable internet provider, the one I bought cost like $80 whereas the cable company wanted to charge $16 a month to lease theirs. She also bought a scale for weight/height, an automatic BP cuff, and a white noise machine… think that’s about it for office supplies.

She paid someone to create her logo and had a sign added to the building marquee and had a logo added to the window outside of her office so she’s easier to find. Total cost for all of that was probably around $900. Maybe not the best use of money but she’s happy with it.

Monthly recurring expenses include cable internet $100, Google Workspace $12, Google Voice $27, and Psychology Today listing $30. She was on the monthly plan for Luminello at $100 but they just raised their prices by 20% so we moved her to the annual subscription since she’s not leaving it any time soon so might as well save the 20%.

Other expenses include malpractice which she’s paying the part-time rate for up to 20 hrs a week. CME, MOC, and credit card processing fees.

Plans Change

As I stated above the plan was to only start a small PP one half day a weekend. There was another cash only adult Psychiatrist in town so my wife got in touch with her to pick her brain and see about getting any child referrals from her (that doc only took patients who were 18+). In the course of their discussion they found that their practice styles were very similar and the doc decided to share a secret with my wife that she was closing up shop at the end of the year after 16 years. She worked with an NP who covered her vacations and whatnot so most of her patients would probably stay with her but there were certain patients who wouldn’t want to be seen by an NP. So she offered to refer those patients to my wife.

Between those patients and any kiddos she got a half day a week wasn’t going to cut it. So she informed her current job that she’d be cutting back to 4 days a week at the start of 2021 and they agreed (not that they really had a choice).

Things started off slow as she only had 8 patients through Dec of 2020 but that was fine as she was only working the half day on Saturday. She spent quite a bit of time calling various therapists in the area to work on a referral base. She was fairly successful with adult therapists but had a hard time getting in touch with the child ones so most of her patients are currently adults. As she has gotten more kiddos via internet searches they’ve been reporting back to their therapists and now the referrals are starting to come in.

Things with the local PCPs have largely been a bust. They’re all employed by the large local hospital system and for CAP the system has one full time Psychiatrist and couple of Pediatricians who play CAPs and an NP. The local CMHC has a CAP and a couple of adult docs.

Plans Change X2 or “You’re going to need a bigger boat”

As things progressed into 2021 her referrals from therapist started growing and there was a decent number of inquiries from Psychology Today. It seemed like 1 day a week was going to be sufficient for a while and she’d be able to at least replace her income lost from dropping a day at her main gig.

Then we found out that one of the adult docs at the local system announced he was retiring. Most of the docs at the system were no longer taking patients anyway and the “providers” that were still taking patients were scheduled for months out. Then one of the other adult docs announced that he was moving and we later found out that two other folks are leaving as well (no idea if the two others are docs or NPs). The local system now has an exodus and they were already relying on locums for their inpatient unit. The system is building a whole new hospital with an inpatient unit and I told the wife that I wouldn’t be surprised if they just scrap their MH services entirely and convert that unit to something else (we’ll see time will tell).

There was also the 78-year-old doctor feelgood in town who got forced into retirement (presumably by the DEA). Oddly enough she sent in a request to become a patient of my wife’s but she wasn’t comfortable with the med regimen (one med from each class basically) or her age… the wife mostly tries to stick to 60 and below but she has a couple of 65+.

And the final straw was that her current job would require her to become a full Medicaid accepting physician but she has one autistic patient in her practice that is on Medicaid that she was not willing to fire. She also anticipates that she’ll be getting more autistic/DD individuals as she has a lot of experience working with those folks and word is starting to get ‘round that she is willing to work with them.

All of this leads up to the realization that one day a week will no longer cut it and since the Medicaid thing is non-negotiable she ended up turning in her notice for the end of July. Her current clinic cuts over to insurance in August and her sticking around until July allows them time to try to find a replacement (good luck!). She also has 19 days of vacation to use before then so she’s using some of that to open additional days in her PP between now and August.

Daily Operations

So when she first started out her auto attendant had 4 options… 1) Patient messages, 2) patient refills, 3) new patients, and 4) Other providers/pharmacists. Options 1, 2, and 4 went to voicemail and option 3 said the voicemail box was full and directed them to her website where they could submit a new patient evaluation request via Luminello. We noticed that she was getting a decent amount of calls via Psychology Today and no evaluation requests. So I created a second auto attendant where option 3 is routed to her assistant (me) and she started getting a lot more requests once they could talk to someone.

I’ve become pretty good at converting calls to evaluation requests but even so the hit rate is probably only 20% or so. Most folks want to use their insurance so as a service I talk them through how to search their insurer’s physician lookup and tell them to start calling around. We’ve now started getting people coming back and signing up after calling around and not finding anyone. They always thank me for taking the time the first time around so I think of it as cheap marketing (all it takes is bit of my time).

She uses Luminello’s pre-screen evaluation requests to make the first decision on whether to start the new patient intake process. It has worked well for the most part. Once she accepts they get 7 forms (consent for treatment, office policy, credit card authorization, financial policy, blah blah blah) that they electronically sign through Luminello and a questionnaire (and maybe rating scales). We also have instructions on how to update demographics and add a credit card in the Luminello portal welcome message. No patients are scheduled without completing all of those items.

We send an e-mail after the paperwork is sent as sometimes the Luminello notification e-mails to them end up in spam. But even if she approves the eval and sends documentation a decent number of folks flake out before filling any of it out or halfway through. I can sometimes prod them info finishing and get them scheduled. So we’ve learned to not get excited when people send in requests or even start filling stuff out.

If you’re looking to have geri practice I don’t know that I’d use Luminello. Even without the pre-sceening it seems to screen out older patients all by itself. There have only been two 65+ folks who have made it all the way through the process and even after helping several through the process on the phone they never made it through to actually be scheduled. Which is fine by my wife as she has now decided to just keep it mostly to 60 and under. The younger crowd loves Luminello.

Since she took over a few patients from the cash pay doc who left practice she just adopted her pricing structure. It doesn’t necessarily make a ton of sense since follow ups are 33% more than new evals on a $/hr basis but we think that since she was in practice for 16 years she wasn’t really doing too many new evals. So when she raised her prices she must have raise the follow up rate and not bothered with new evals. The new eval rate is what my wife was planning to charge anyway and she does 1 hr for adults and 1.5 hrs for C&A.

Her one day a week is now starting to be consistently full two weeks out and we’re starting to fill some of those extra days. I think she’ll be able to make it to July without having to be more than a month out but it’ll be a close thing. She’s consistently getting 5-10 new referrals a week and since people are finding less availability in the area the new referrals seem to be picking up steam. She also now has 4 or 5 therapists that are unaffiliated with practices that have their own “prescribers” that are sending a lot of patients her way.

She has now begun informing her current patients at her main gig that she is leaving and many have said they will follow her. Some of them were transfers from the other doc, some of them know the reputation of the other doc, and others are just patients who want to stay with her. We’ll see how many actually follow through but it should be a decent amount as I can’t imagine they’ll find a replacement any time soon so there’s going to be a big crunch as the clinic can barely service the current volume as is.

Current patient load and financials to follow in next post…
 
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trophyhusband

10+ Year Member
Sep 8, 2009
263
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2020 – 8 patients and a loss of ($4,201.76)

2021 Q1 – 41 patients (11 C&A and 30 Adults) and a profit of $15,662.93 (before taxes)

2021 first 2 weeks of April – 6 new patients and room for 2 or 3 more.

Profit and Loss

September - December, 2020​

SEP 2020
OCT 2020
NOV 2020
DEC 2020
TOTAL
Income



Sales
0.00​
0.00​
1,850.00​
1,550.00​
$3,400.00​

Total Income
$0.00
$0.00
$1,850.00
$1,550.00
$3,400.00
GROSS PROFIT
$0.00
$0.00
$1,850.00
$1,550.00
$3,400.00



Expenses

Advertising & marketing
0.00​
0.00​
0.00​
350.00​
$350.00​



Listing fees
0.00​
29.95​
29.95​
29.95​
$89.85​

Total Advertising & marketing
0.00
29.95
29.95
379.95
$439.85
Building & property rent
0.00​
514.94​
0.00​
250.00​
$764.94​



Business licences
99.14​
0.00​
0.00​
0.00​
$99.14​
EHR Expense
0.00​
0.00​
158.00​
99.00​
$257.00​



Insurance
0.00​
0.00​
0.00​
0.00​
$0.00​
Liability insurance
0.00​
0.00​
2,417.00​
0.00​
$2,417.00​



Total Insurance
0.00
0.00
2,417.00
0.00
$2,417.00
Office expenses
1,769.11​
790.65​
0.00​
265.33​
$2,825.09​



Merchant account fees
0.00​
0.00​
0.00​
61.05​
$61.05​
Software & apps
12.00​
4.82​
35.50​
265.68​
$318.00​



Total Office expenses
1,781.11
795.47
35.50
592.06
$3,204.14
Utilities
0.00​
0.00​
0.00​
0.00​
$0.00​



Internet & TV services
0.00​
219.69​
100.00​
100.00​
$419.69​

Total Utilities
0.00
219.69
100.00
100.00
$419.69

Total Expenses
$1,880.25
$1,560.05
$2,740.45
$1,421.01
$7,601.76



NET OPERATING INCOME
$ -1,880.25
$ -1,560.05
$ -890.45
$128.99
$ -4,201.76
NET INCOME
$ -1,880.25
$ -1,560.05
$ -890.45
$128.99
$ -4,201.76


Profit and Loss

January - March, 2021​

JAN 2021
FEB 2021
MAR 2021
TOTAL
Income



Sales
6,100.00​
4,500.00​
9,700.00​
$20,300.00​

Total Income
$6,100.00
$4,500.00
$9,700.00
$20,300.00
GROSS PROFIT
$6,100.00
$4,500.00
$9,700.00
$20,300.00



Expenses

Advertising & marketing
376.80​
245.00​
0.00​
$621.80​



Listing fees
29.95​
29.95​
29.95​
$89.85​

Total Advertising & marketing
406.75
274.95
29.95
$711.65
Building & property rent
250.00​
250.00​
250.00​
$750.00​



Dues & subscriptions
175.00​
665.00​
0.00​
$840.00​
EHR Expense
99.00​
99.00​
100.00​
$298.00​



General business expenses
0.00​
0.00​
0.00​
$0.00​
Continuing education
0.00​
0.00​
905.00​
$905.00​



Total General business expenses
0.00
0.00
905.00
$905.00
Office expenses
148.74​
9.62​
0.00​
$158.36​



Merchant account fees
70.47​
240.15​
192.43​
$503.05​
Shipping & postage
4.25​
0.00​
0.00​
$4.25​



Software & apps
65.40​
50.68​
50.68​
$166.76​

Total Office expenses
288.86
300.45
243.11
$832.42
Utilities
0.00​
0.00​
0.00​
$0.00​



Internet & TV services
100.00​
100.00​
100.00​
$300.00​

Total Utilities
100.00
100.00
100.00
$300.00

Total Expenses
$1,319.61
$1,689.40
$1,628.06
$4,637.07



NET OPERATING INCOME
$4,780.39
$2,810.60
$8,071.94
$15,662.93
NET INCOME
$4,780.39
$2,810.60
$8,071.94
$15,662.93
 
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Sushirolls

Topped with salmon, avocado and tobiko
10+ Year Member
Feb 24, 2010
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Off to a hell of a start. Your trajectory will be amazing. Well done, congratulations. I look forward to the future updates!
**Applause**
 
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