Start-up costs

[APDoc]

Anybody have a good estimate for general start-up costs for starting a new solo private practice? In a group right now where overhead is around 70% for me, and looking at my options right now. I've done a search and found some helpful info, but not much on cost estimates. Thanks in advance!

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[APDoc]

Just wanted to give this a bump in case anyone could help me out. Even if you could point me towards a good resource or link that would be great!

 

[hyperalgesia]

Just wanted to give this a bump in case anyone could help me out. Even if you could point me towards a good resource or link that would be great!

We have had this convo many times on here. You just have to search with a lot of different terms.
There's a huge range of options that will determine your cost. If you sublet office space and staff and use an ASC, it can be dirt cheap. If you lease a large office in a city and get the latest equipment and staff, it is a ton of money.

 

[promethius]

As hyperalgesia pointed out, start-up costs vary depending on how much investment you put into it. When you start off, I would recommend at least leasing your own office and doing procedures in-office, as that way you can collect both the professional and in-office facility fees.

As for start-up costs, the biggest overhead costs will be (1) c-arm, (2) imaging table, (3) staff, and (4) office lease. It will take time to build up your practice, as many on here will attest to. Having said that, you will want to keep your overhead as low as possible, as you do not want to burn through all of your savings/loan when you are only seeing a few patients a day and building up your practice. C-arms will cost anywhere from $20K to $80K depending on the year, model, and features. Imaging tables usually run from $5K to $10K. Of course, you can always lease these equipment, which will cost less, but the monthly fees will be set regardless of whether or not you are using the equipment. Factor in the staff, office lease, and other medical supplies and equipment and you are looking at a start-up cost anywhere from $75K to $150K, again depending on your location and situation. You will probably want to have at least double to triple that amount to make sure you have enough funds to carry you over until the practice reaches a self-sustaining volume.

 

[drusso]

A very rough estimate would be $300K for in-office fluoro/US pain practice.

 

[PainMD23]

For a single physician interventional pain practice with in-office fluoro and enough square footage for 3-4 exam rooms, waiting room, physician office, staff workroom, bathrooms, you are looking at needing 300-400k capital for startup and 5-6 months of operating expenses, but of course this varies on your location. This question is more involved, and has more variables, than can be discussed easily on a forum like this. I know some on this forum have had bad experiences with medical consultants for start-ups, but if you are truly a business newbie, you would be wise to at least have a helping hand/ consultant for your initial startup. Your initial team should consist of your accountant and/or financial advisor, a good healthcare attorney, a good insurance agent, and an office manager and/or consultant with much healthcare experience. Just my 2 cents.

 

[Got Em]

Thank you for starting this discussion. I have some more questions that may seem very basic, but I couldn't find this when I searched the other threads.

When does it make sense to do procedures in office vs. doing them in an ASC? I heard that if you can do procedures in office, you're "up-coding" if they're done in an ASC, is that true?

Wouldn't it be more profitable to have a small clinic where you run M-F and do procedures at a different ASC where you can share the space/nurses with 1-2 other pain docs and split the revenue generated from the ASC? I read somewhere you can build a 1 OR ASC for around 500k.

 

[promethius]

If you are just starting off, it is better to do your procedures in an office than in an ASC. Once you get established, you will have to run the numbers to see if it is more profitable to do the procedures in an office versus in an ASC. I am not sure if it is truly "up-coding" if you do procedures in an ASC that can be done in an office, but you definitely get reimbursed more with facility fees when doing procedures in an ASC than in an office, but then there are also more cost and regulations involved for increased monitoring and safety purposes when doing procedures in an ASC than in an office.

 

[hyperalgesia]

Thank you for starting this discussion. I have some more questions that may seem very basic, but I couldn't find this when I searched the other threads.

When does it make sense to do procedures in office vs. doing them in an ASC? I heard that if you can do procedures in office, you're "up-coding" if they're done in an ASC, is that true?

Wouldn't it be more profitable to have a small clinic where you run M-F and do procedures at a different ASC where you can share the space/nurses with 1-2 other pain docs and split the revenue generated from the ASC? I read somewhere you can build a 1 OR ASC for around 500k.

From the most money, highest investment/risk to the cheapest and least risk:

1. Buy/build your own ASC (Bill for both professional and facility components of each procedure, ASC reimbursement codes pay the second best, after owning your own hospital).

2. Lease your own office, buy/lease equipment (c-arm, etc) (In-office cpt codes for procedures pay ok and you have a lot of control of your set-up, staff, etc)

3. Lease/sublease office but do procedures in ASC/hospital you don't own (Procedure fees are low because you're only collecting "professional" fees, the ASC/hospital gets the facility component)

There are many unknown variables when starting a practice. The biggest one is will you have a STEADY, reliably stream of patients that you are happy treating. This often takes time to develop for a lot of reasons.

The next biggest is issue is whether insurers will allow you on their panel. These are MAJOR questions that have left many docs in very bad situations. They are very difficult to answer until you are on the ground and in practice.

Everyone is different but my approach would be cautious. If possible have another gig on the side, get credentialed at a hospital and ASC, all insurance plans, lease or sublease an office with minimal overhead at first. Do procs at hospital/ASC just to get your feet wet. Since you don't have any ownership in these facilities, the payment for procs is low.

Try your hand at business/billing. You might be a natural business person and have pts flocking to you. At that point, many unknown variables have been defined and you will have a better understanding of risk/return. You could then decide it's worth setting up your own fluoro suite, buying into an ASC, etc.

 

[Ducttape]

The previous post has an error - you cannot collect facility fees at an ASC.

You can buy in or become a partner and get a share of profits tho...

In addition, there may be state regs pertaining building an ASC that could derail those plans.

 

[lonelobo]

The previous post has an error - you cannot collect facility fees at an ASC.

You can buy in or become a partner and get a share of profits tho...

In addition, there may be state regs pertaining building an ASC that could derail those plans.

If you are the sole owner of ASC, you can collect ASC facility fees.....that is why single room/single specialty ASCs used to be all the rage $$$$$$$$

 

[NOSfan]

In a group right now where overhead is around 70% for me

70% overhead.....would have independent auditor look at the books and call the police.......seriously!