I'm a LCSW who has a private practice in a metropolitan area. I was 7 years post-MSW and 5 years post-licensure when I got it going in '05 and it turned a tiny profit even in its first year, and significantly more last year. I only do it part-time (usually 12-15 clients/week) as I have 2 other part-time jobs and I'm in school part-time, but it's as busy as I want it to be. If I wanted to grow the practice, it wouldn't be that hard at this point. I haven't done any marketing in months...
Connections and networking are the KEY to making this thing a success from the start- I cannot stress that enough. That would probably be the biggest barrier to a brand-new clinician finding success. I have a lot of contacts from previous jobs, who have now moved on and up. I met the group of practitioners I hooked in with as they were heavily-utilized providers for the managed care company I was working for at the time. They had someone leaving and wanted that 20% of the (really cheap) rent paid. (There are 5 of us- all "sole proprietors", so we divide utilities, rent, etc equally.)
As I started, my colleagues were able to flip me a few referrals which they weren't able to accomodate for one reason or another- scheduling, not on insurance panel, etc. This wound up leading to connections with 2 different psychiatrists, who have been a wealth of referrals. Subsequently, one of those docs has referred 2 of his colleagues to refer their patients to me. My first-ever referral was from a friend who I used to work with doing psych intake. She assessed a kid and thought of me. My suite-mates had done an excellent job of marketing before I joined, and got me onto 2 closed EAP panels solely because I joined their office. CONNECTIONS. My practice could not survive without them.
Regarding the managed care vs self-pay thing.. in my area, most people start by doing at least some managed care work, and then work their way toward more self-pay as the practice becomes more established. You learn pretty quickly which panels are worth your time- not just who pays the best, but also how much paperwork is required. My suggestion: If you're going to do managed care, try to fill out the applications as early as possible. They take months to process for credentialing. Many places are now using CAQH, so at least you don't have to handwrite all of them anymore.
Startup costs- chair, desk, couch, sure, all that. You can do it relatively cheap. But ambiance counts for a lot, so things add up when you toss in a rug, bookshelf, wall art, etc etc etc. Heck of a lot cheaper than buying medical equipment, though. As someone mentioned- malpractice insurance. Managed care panels will require proof that you have it. I'm guessing the APA offers a plan? Mine is through the NASW and it's dirt cheap because of the group rate discount, and has good coverage.
Marketing- I was lucky, my colleagues had done a lot which made my road a lot easier. A lot of my friends work in mental health, so they all got my cards, as did pretty much everyone else I met for about the first 6 months. I knew a lot of the discharge planners at the psych hospitals from when I had worked managed care, so they all got a visit and some cards. We threw an open house last year and invited about 100 contacts to come for free food.
I've always said- and have never followed up on this- that I think the REAL referral base is with family practice docs and pediatricians. Psychiatrists usually already have their preferred referrals. But what if a clinical psychologist trained in child behavioral mod was to talk with a few pediatricians about referring for an assessment all the r/o ADHD kids who came through before they ran to the prescription pad? I think you could make a mint off of a partnership like that, not to mention the clinical benefit to the families.
At any rate, private practice is completely doable, but I'd recommend working on the networking thing while being employed somewhere prior to hanging a solo shingle. As a SW, we don't have the option of doing that right out of school (can't practice independently without a license, which takes minimum 2 years post-grad to get), but the work experience I got in the interim was absolutely essential for my practice to get where it has.
), a psych private practice would be easier to start than almost any other business. Mostly because you'd have unbelievably low initial costs(office, couch, chair, appointment book....that's about it!) I'm obviously making light of it a bit as there are always other things to consider, but the fact that you don't have to lay out as much cash initially means it won't carry the risk of other business ventures where you might have to lay down hundreds of thousands right off the bat for a bigger building, equipment, a large staff, etc.
