Telehealth only small practice vs small group practice per diem and considerations?

[quickpsych]

I've been contemplating starting a small telehealth only private practice but have a few variables I'm trying to sort out and am curious as to others' feedback and experience with this. Obviously the pandemic has changed the landscape of our work and what was once a rarity is now quite common I'm hearing regarding telehealth services. I do commute for my main job (which is 2-3 days a week in health care related settings) but longer term would be nice to consider a small side practice from home. Scratch the itch to get back to some more traditional talk therapy while also making a few extra bucks a week without adding more to my main work.

Here's some variables I'm trying to weigh pros/cons of, get feedback on, and also see how to approach them:

- I currently do some side work for a small boutique private practice. At this time it's mostly doing some occasional testing and assessments. Recently the owner has asked if I want some telehealth therapy cases. They charge $250/hr no insurance, but says they pay out $100 at first to psychologists for each session and generally increases it upwards to $125-150. I told them I think it's a little on the low end so we shall see. They also charge higher for the initial session as "it's also a clinical intake and interview." There's no pressure to take therapy cases although they noted I'm the only male psychologist or therapist at the practice..and well there's been more increased demand for those from referral sources. That really got the wheels turning. I'm fine with their fee split for testing and assessment but hey, market demand and value on therapy case demand seems to be in my favor .

- Got me thinking maybe I should just start a small , generalist, private practice online only. Goal is one day a week maybe just 3-5 sessions. Market rate in my area for private pay no insurance psychologists is around $150-$275 although I do see plenty of master level therapists charging $120-$190 which seems a bit high for them. I don't want to undercut myself, is $200 fair? I'm not trying to go full time and most I'd consider scaling up , if demand would be like 2 days a week 2-5 sessions a day. I have no non-compete agreement or clause with the other psychologist and would prefer to continue occasional assessments/testing with them which probably means I would not take any therapy cases from them to keep things separate.

- For a very small private practice like this, do I need an LCC?

- Do I need a website and marketing or is just putting up a good Psychology Today website and get a HIPAA complaint email and phone number?

- Are PSYCPACT interstate fees and setup worth it for this small of a practice or should I just focus on within my state of licensure?

- From other threads insurance paneling seems like a waste of time if I'm not trying to be full time, yes?

- I have a few colleagues that I could refer to if I couldn't take on a patient and also a few colleagues who seem happy to refer a few patients if I finally decide to open up shop. I feel this offers a valuable customer service too, if someone takes the time to call me for my services and I can't accommodate them, seems like good business to be able to help them with a few possible practices they could go to.

- Worth it to niche down or keep more generalist (within scope of course)?

- Therapy Notes seems to be popular for small practices and seems to include everything you need, is this the case? Do these EHRs typically include ability to edit and send/receive documents like consent forms?

- Are those 15 minute free calls/consultations worth it? I hear mixed reasoning for them.

- I already have a 401k through my main gig and I pay for my own health insurance (by choice). I also already carry my own malpractice and liability insurance. Any tax or other considerations?

- Anything else I should consider?

So overall trying to figure out if worth it to branch out on my own for a few hours a week of a telehealth private pay only practice or just get some patients from the other private practice with no overhead or marketing needed. I wouldn't be too concerned if I set aside 5 slots and only filled 2-3 and only got a few calls or referrals every so often as I'd plan to be at home during that time anyways. Also the small private practice offering me therapy cases is 1099 so I imagine my own practice would be similar taxes. I'm not trying to make this a full time practice.

Ask me a few years ago and I was was not remotely thinking of setting aside time for weekly sessions after a few years in community mental health while pre-licensed (and in peak pandemic no less doing 8-10 hours a day of community mental health tele therapy). But it's been few years and I have much more autonomy and flexibility now.

Thanks all!

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[deleted1129370]

I can speak very much to your questions and situation as I was/have been in your situation. My current day jobs is as a VA psychologist and assistant professor for a AMC. I have my own group private practice that is 100% online. I take both insurance and cash pay. I will address your questions below:

- For a very small private practice like this, do I need an LCC? I would highly recommend getting a LLC. I have a PLLC here in Houston. You will want to keep your business expenses and assets separate from your personal ones. There's also the potential to have some nice tax write offs (which I've done for two years now, and love it). Having a LLC also establishes you as being more credible to the lay consumer as people tend to associate a formed company with legitimacy in terms of healthcare services. And then there is the whole protection from litigation aspect. My malpractice insurance covers both myself and my business. I also request that my contractors name my business as an additional insured, and I retain copies of their insurance face sheets for my records in the event they receive a board complaint, etc.

- Do I need a website and marketing or is just putting up a good Psychology Today website and get a HIPAA complaint email and phone number? Think of your online business as your physical store front. If you are offering 100% online services, you should have a website that is reflective of this decade (I've come across a lot of psychologists websites that look like they made it themselves back when AOL dial up internet was the craze). Consumers will want a website that will be both functional and appealing. If you have a website that is busy with all sorts of block text, or they have to spend more than a few seconds scanning all the BS jargon to find their answers, they will likely leave the website and not become a converted prospect (i.e., website bounce rate). You should aim to stand out from the crowd of provider (both psychologists and mid-levels) who have been on the market much longer than you - your website can help you achieve that. My website has been the single-most beneficial piece of marketing I have. I designed it myself. I have many years of experience designing websites for all sorts of businesses in politics, music, and private practices, and I am pretty good with SEO after years of research and application. So...take my advice how you will on this.

- Are PSYCPACT interstate fees and setup worth it for this small of a practice or should I just focus on within my state of licensure? For me yes, as I currently carry a caseload of 12 patients, and out of those 12, almost half of them are from outside of Texas. PSYPACT has opened a lot of doors. I have already received 2-4x the return on my $440 I invested in paying for PSYPACT.

- From other threads insurance paneling seems like a waste of time if I'm not trying to be full time, yes? Not sure I would go this far. I will admit, in my first 5-6 months of opening my virtual practice doors, I was 110% against taking insurance. I read all the threads and Facebook groups just badmouthing insurance. I ended up figuring out it was very feasible to make a 6 figure income with taking insurances. I applied to Aetna, Cigna, United, BCBS, and Humana. I ended up getting paneled with Cigna, United, BCBS, and Aetna. Without telling you exact rates, I can tell you that United, Aetna and BCBS pay the best (well above $100 per 90837 and 90791), but this will largely depend on your state, location, how many other providers are paneled in your area, and some other actuarial factors. Needless to say, I have insurance down like a science. I see my patient for 50 minutes, I collect their co-pay, schedule them their next appointment, I click two buttons and file their CMS1500 claim, and typically 1-7 days I receive their payments. I have yet to receive a denial or rejection as I make sure to not make the common mistakes many folks tend to when submitting claims. It's literally just doing your research to ensure your CMS form is compliance with what is expected by the insurance company. The people who complain about rejections and denials are typically people who don't follow instructions the first time around, and then let it snowball because they wait weeks or month before submitting claims. I always submit my claims immediately after I see each patient and before I see my next one. It's been well worth it. Think about it like this, if you had 25 patients a week and were getting roughly $125 per patient from the insurance, you earn $3125 per week, and if you worked a 40 week year, that comes to a gross pay of $125,000. Granted, there will be fluctuations in this, so you can offset this by seeing more patients at some times, and then scale back during others.

- Worth it to niche down or keep more generalist (within scope of course)? For me, I am both a generalist and specialist as I do therapy testing online. I've also grown my practice by hiring 3 contractors and take 25% of their earnings and let them keep 75%. You will find there are a lot of people out there seeking therapy. The most recent stats I came across were people looking for treatment surrounding anxiety, depression, trauma, and substance use. Many typically prefer in the morning times, but many also prefer afternoon/early evening. Not a whole lot prefer weekends. So, yes, being a generalist can help. You don't have to jump on the "niche" bandwagon if you don't want to, but this might limit the income potential as people will likely feel comfortable spending more money with a person who focuses on like 1-2 things as a specialty. They see more value in that person and internally justify the cost vs. someone who is a jack of all trades or generalist.

- Therapy Notes seems to be popular for small practices and seems to include everything you need, is this the case? I am biased in that I have used SimplePractice for 2 years and love it. They are literally....simple to use for everything. It's my EHR, scheduler, appointment reminder, insurance claims submitter, bookkeeper (to an extent).

- Are those 15 minute free calls/consultations worth it? I hear mixed reasoning for them. Yes...think of it this way, taking 15 minutes to get to know what is bringing the person to see you will allow you to screen out folks you have no desire nor experience treating. It gives you an opportunity to set your policies and expectations with them. Doing good filtration at this stage will save you a lot of headaches for the most part. I am very transparent and comprehensive in my policies and provide at least 3 opportunities to review them from the first time they call me up until our first meeting. This comes from experience and has played out favorably for me. Alternatively, this is a good opportunity to determine if the prospective client is someone you want to work with. Something that are a no go for me, are other people calling on behalf of someone else seeking treatment for them. I just want work with folks like that as it is a potential red flag that I am going to get triangulated and end up being put in the middle of unforeseen BS....I just don't want to deal with that.

- I already have a 401k through my main gig and I pay for my own health insurance (by choice). I also already carry my own malpractice and liability insurance. Any tax or other considerations? Let's just say that in my last tax filings, I was able to pay for our upcoming 12 year wedding anniversary cruise/flight/trip to Europe coming up in September. If your house is the base of operations, there are a lot of potential tax savings you can tap into. I have a membership with a tax/accounting firm that specializes in mental health private practices that does all of this for me, and they even do our personal taxes as part of the membership.

- Anything else I should consider? I would consider what it is you want to achieve in private practice. What are your values, goals, passionate pursuits that being in private practice might enable you to achieve? For me, it's getting the hell out of the VA and really, not working for others. I've learned I am fussy and have zero tolerance for a lot of the BS observed in large organizations. I also believe that if I am putting in the hard work, I want a larger piece of the pie. I am very business minded, and this is not my first time having a business nor marketing and web-designing, so I have some advantages over others. For me, I want to take more vacations, earn more money than I would at the VA, and have less administrative/clerical BS burdens, and work when and how I want to, not how others tell me. Being a business owner is really about being able to effectively make good quality relationships. Since being in private practice, I have been wined and dined by a couple of dental practices in the Houston area due to my marketing efforts and them wanting to network with me. I spend a lot of time marketing, and I engage in a lot of marketing styles. I do this because I am building a group practice in which I want a balance between insurance and cash pay clients, so that means I will need to engage in more direct forms of marketing. I enjoy it. I really love the business and marketing side of private practice. Ideally, I want 9-10 contractors and I manage the business side of things and see a few patients in the week, and live off of the passive income of my contractors.

Again, consider what will private practice enable you to achieve as far as goals (personal and professional), values, and passionate pursuits. What aren't you getting from your day job?

Oh, I should add, that making the transition into private practice, whether part time or potentially as your full time gig is better accomplished when you are in a place of comfort and advantage (i.e., being employed and not worrying if you will make money to pay your bills). I had to use some of my money from my day job to pay for start up costs. I will say, my overall costs as an online practice are very minimal. To give you an idea:

1. Cost for PLLC - $579 (Legal Zoom) one time
2. Web Hosting - $276 per year
3. Web Domain - $20 per year
4. Psychology Today - $30 per month
5. Mental Health Match Directory - $199 per year
6. Business Cards - $15 for 100
7. Brochures - $48 for 50
8. SimplePractice - $74 per month
9. Google Ads - $750 for 3 months (this was a bust and I don't recommend)
10. Heard (taxation/accounting firm) - $199 a month

I earn about $1870 a week from seeing therapy clients. This is just seeing 12 clients a week.

Hope this helps.

 

[Sanman]

As to the last question you asked, I think whether you go with the practice offer or build your own depends on your plans and interests. If this is a short-term cash play, go ahead and take the offer from the group practice as it is the easy button. Personally, I will be setting up my own practice and not taking insurance. However, I only plan to see 3-5 clients at first. While my goals are similar to @texanpsychdoc, I am not as gung ho about leaving the VA and on a longer timeline. I simply want the infrastructure ready should I choose to leave my day job (which at the moment is a sweet gig, but may not always be). If you want the longer term ability to have your own practice, the work is worth it.

 

[smalltownpsych]

Doing private practice myself and agree with everything that @texanpsychdoc said. One caveat is that I would be wary of banking on telehealth being significantly profitable in the long run. Counseling is pursuing their own pact so that they can practice across state lines and that supply will undercut our ability to make easy money doing telehealth. I also don’t think it is as efficacious as inperson treatment. I remember working for a college in 2010 and everyone was promoting distance learning as the panacea for everything and touted equivalent outcomes. My sense, based on psychological research regarding learning and the interpersonal factors being a predictor, was that this was not true and I think a little Covid demonstrated this on a large scale. I am even more convinced that telehealth being “good enough” is not reality either.

 

[Sanman]

Doing private practice myself and agree with everything that @texanpsychdoc said. One caveat is that I would be wary of banking on telehealth being significantly profitable in the long run. Counseling is pursuing their own pact so that they can practice across state lines and that supply will undercut our ability to make easy money doing telehealth. I also don’t think it is as efficacious as inperson treatment. I remember working for a college in 2010 and everyone was promoting distance learning as the panacea for everything and touted equivalent outcomes. My sense, based on psychological research regarding learning and the interpersonal factors being a predictor, was that this was not true and I think a little Covid demonstrated this on a large scale. I am even more convinced that telehealth being “good enough” is not reality either.

I don't think telehealth will be going anywhere. The supply demand imbalance is too great (most MH professionals cluster). I do think that the easy cash money will leave/be spread out as competition increases and it is possible that the payment structure for insurance, etc will be reduced. Over the next 5-10 years, I think it will still be okay as the market matures.

 

[deleted1129370]

Doing private practice myself and agree with everything that @texanpsychdoc said. One caveat is that I would be wary of banking on telehealth being significantly profitable in the long run. Counseling is pursuing their own pact so that they can practice across state lines and that supply will undercut our ability to make easy money doing telehealth. I also don’t think it is as efficacious as inperson treatment. I remember working for a college in 2010 and everyone was promoting distance learning as the panacea for everything and touted equivalent outcomes. My sense, based on psychological research regarding learning and the interpersonal factors being a predictor, was that this was not true and I think a little Covid demonstrated this on a large scale. I am even more convinced that telehealth being “good enough” is not reality either.

I very much agree, and honestly, I have been looking for a space to rent here in my area for about 6 months with no luck. However, a piece of advice someone told me is "you can't be everything to everyone," meaning, while some folks really might prefer in person, that's fine, there are folks out there who can provide those services, however, if you'd prefer to be 100% online, you will also have plenty of options. There is a huge shortage of providers providing therapy on a national level...people are desperate. You can use that to your advantage.

 

[calimich]

agree with what others have said, The demand is there to go on your own, especially since you have other income and can wait for private pay clients. Pricing sounds right. Build a website, or pay someone. I think telehealth is here to stay.

 

[quickpsych]

Thanks all, I really appreciate the replies and good feedback , definitely some actionable information here to dive into. I agree with most that telehealth seems here to stay. I do sometimes wish I had my own office but then I look at others and they've really had to build things up to make a profit in the physical space.

Tech wise I'm pretty savvy but really looking to keep it integrated and simple. On a technology note for @texanpsychdoc , I noticed you listed you pay for SimplePractice but also a web site, web hosting, and a mental health directory but in looking at SimplePractice it seems they offer websites and a directory included in some of their plans. Was it that you wanted a more robust website then?

Hoping to set aside some time to look over these posts more and start mapping some things out!

 

[smalltownpsych]

Thanks all, I really appreciate the replies and good feedback , definitely some actionable information here to dive into. I agree with most that telehealth seems here to stay. I do sometimes wish I had my own office but then I look at others and they've really had to build things up to make a profit in the physical space.

Tech wise I'm pretty savvy but really looking to keep it integrated and simple. On a technology note for @texanpsychdoc , I noticed you listed you pay for SimplePractice but also a web site, web hosting, and a mental health directory but in looking at SimplePractice it seems they offer websites and a directory included in some of their plans. Was it that you wanted a more robust website then?

Hoping to set aside some time to look over these posts more and start mapping some things out!

The websites of providers that only use the available portal from their practice software are functional at best. I chose to use my own website so that consumers can access more information as I know that when I am researching something, I tend to give weight to services based on their website presence and I prefer patients that want to be informed so I cater to them.