Starting a healthcare practice can be the most rewarding undertaking you ever experience, but it can also be exceedingly challenging.
Below are some of the most common mistakes a practitioner makes when taking the plunge into private practice.
Time is of the essence when you open a healthcare practice
The process of starting a practice should begin way before you open the doors. Do not put yourself in a position of urgency. As motivated as you may be to get your practice up and running, you will need to rely on the help of others – business coach, lawyers, real estate agents, etc. – who will likely not share your sense of urgency. If you don’t have 3+ months to devote to starting your practice, you take the risk of opening the doors with too few patients.
Show Me the Money
There aren’t many individuals, including you, who can start a new practice without the support of a lender. Undercapitalisation is the number one reason for general business failure. So, assume you will get to know your lender. You want to be working toward the same end. Too little money can sink the ship but too much money can also put you in the danger zone. Developing a financial plan is important in not only constructing the numbers but making initial decisions about how the practice will run. What services will you offer, what space will you need, how do you want the space fit-up, what payer mix will you have, how much will your electronic/paper health records and practice management software cost, what about marketing, etc.? Calculate to the closest dollar amount your revenue expectations and then list all expenses. Divide the expenses in to what you will need before you open the doors, after you open the doors and operating expenses for the first year to include equipment as well as subject matter expertise (lawyer, accountant, medical business advisor). Project the worst, most likely and best case scenarios. Put together your last two years of tax statements and complete a Personal Financial Statement. Then you will be ready to go to the bank.
Hire Slow, Fire Fast
Recruiting and hiring is a skill. Get help to ensure you bring in highly motivated staff that is as invested as you are. Until you are certain that an individual is a good fit culturally, can understand, demonstrate and abide by your vision and values 100% of the time, do not offer them a job. If you’re going to be in a fast paced practice, hire staff that can keep up with you. Hiring the wrong people can be extremely expensive considering how much you will invest in them to learn your IT systems, equipment, and patient flow processes. More importantly, surrounding yourself with the right people will make you and your patients’ experience so much more positive. Hand holding a subpar employee is never advised. Think of the “opportunity cost” of this behaviour. If you didn’t have to spend time with them, you’d have the “opportunity” to spend more time with your patients, your family, or doing anything else you’d enjoy.
The Technology Chase
These are very exciting times when it comes to technology in healthcare. It is refreshing to know that we are on the path to improving the quality of patient care and the patient care experience through the use of technology. Choose the technology in your practice very wisely, many software providers let you do free trials before buying or go & visit other local practices that have the technology that you are interested in.
Healthcare is Business
Do not hesitate to work alongside and in cooperation with a healthcare business expert. Not just a business expert, a healthcare business expert. The healthcare arena is a beast of its own. They will devote the time, energy, expertise, and demonstrate the patience that this process requires.