My friends In medium and low cost are on the lower end 150-200. They did the fantasy math like above and found that in the end there gross numbers were at least 15-20% less esp when you combine holidays, no shows, denials, non payment and sometimes slower months as you won't be 100% filled always. Even with slim margins lets just say you have 30% overhead thats pretty optimistic when you account for billing, rent, utilities, staff etc.
Reality is if one did work 48 weeks and got the rates you said cut 15% off that 720k then another 30% off that number and your at 430k pre tax which still needs to be taxed by uncle sam/state/local/medicare/ss/ etc.
Also as you get older you probably want more than 4 weeks of vaca. I took double that last year and keeping that now.
Regardless of private practice or any setting, you're going to be taxed. The more appropriate contrasting cost to private practice is going to be practice expenses and benefits. My overhead is about 15% but I know some who have even less.
You also have to consider benefits if you are taking a salaried job as health insurance can be an additional $10k-50k per year for a family depending on the plan. It would cost my family of 4 about $4000/month for an equivalent health insurance to what my spouse has.
200-250 for that combination is on the high range for most of the US. Alma/Headway can get you around the lower end of that. A solo practitioner directly contracting with insurance in most parts of the country would be thrilled to get 150-200 for a 99214+90833. Also, therapy add on codes are never that close to E/M codes. My rates were about 110 for a 99214 and 40 for a 90833. Insurance heavily incentivizes the 15 minute follow up visit model.
Insurance rates are hyper-local. Alma/Headway aren't insurance companies, they're intermediaries that give the provider a rate after they factor in overhead themselves. How much do you think they take as a cut? Get paneled independently if you want to see what you'll get. I found that some group practices were getting around the same as me as a solo provider so I'm not sure how much leverage a group practice has even though everyone told me they have more.
The range of 99214 that I directly received from the big insurance companies ranges from $106 to $259 with an average of $185, with Medicare non-facility price being around $150. Mind you, this was 5 years ago when I first started my practice prior to post-pandemic demand increasing for psychiatrists. Also where I chose my office also changed the rates. I could have chosen an office two miles down the road in another county/zip code and that would have given me slightly but not insignificantly lower rates of about 2-5%.
The range of 90833 that I received is $70 to $151 with an average of $104 with medicare being $80.
That being said, my average for 99214+90833 from insurance contracts is closer to $300, which could be an outlier and why I underestimated but it is my experience. One outlier insurance company offered $400 for that combo.
Yes, obviously you would have to fill up that time and also 90792/99205 for intakes are probably not going to give you as much as follow-ups. You'll have to do many more intakes at the start of practice as well before scaling up but once you're settled into private practice, it's about margin efficiency.
After going through the insurance negotiation process and taking cash patients during that process, I decided not take insurance and only take cash as I was able to have an adequate stream of patients. I bill at a higher half hourly rate than $250. OP was asking about whether there is a realistic path and I wanted to give my two cents in on another path outside salaried jobs. My income has been >$500k since I've graduated with my cash only CAP practice in a VHCOL area but I'm also living in a VHCOL area so it feels less like it. My benefits are from my spouse but otherwise, I do put in max pre-tax 401k from employer and employee portion which is much more than what the employee max is and if I wanted to put in even more pretax money, I would do a cash balance plan.
