Have you ever thought about starting a private practice? If so , you may be aware of the many challenges involved.  It certainly isn't for everyone, but if you decide that the private practice model may fit your lifestyle and you desire to take a lead role in the administrative burden involved, here are a few things to know.

Initial Investment

• Location: The biggest financial consideration and the most important variable, depending on what part of the country you are in. Finding the right location for a practice is key. Are there patients in your area with insurance? If so, what is the insurance mix? What's the proximity to the nearest medical center?
• Property and Equipment: Embedded within that location is your physical space and the assets vital to run your business. This includes modifications to the space and the equipment needed to see patients.
• Staffing: In general, it is important to have a "wish list" regarding staffing. How would you like your practice to look at full capacity? Then consider how much staff you need to run lean in the beginning.

Financing

Being cognizant of your initial cash investment and your current debt obligations are vital in obtaining any type of loan. Financing options will vary from person to person depending on preexisting financial obligations, but there are certainly options for each situation. These range from large commercial lenders and smaller credit unions to small business government backed loans.

Cash Inflow

• Time Arc: The most important consideration involved with starting your own private practice is the time arc involved.  Generally, it is required to have a physical location to get accepted by payors.  Getting accepted by Medicare/Medicaid may take up to three months, whereas other private payors may only accept you as a provider after six to nine months.  In addition to getting accepted, it may take up to one month or longer to get paid after you see your patients. What this means is that you must be able to support your business and your personal financial obligations for several months before you start seeing cash from your business.  Once you are accepted by multiple payors and start seeing patients, then you become cash flow positive.

If you've gotten this far, you probably have at least a cursory interest in private practice.  Yes – there is a lot of headaches, risks and uncertainties involved with building a practice from scratch.  And Yes – there are less and less small private practices than there once was and frankly, dealing with all the non-medical issues just isn't for some people. But – being your own boss, controlling your schedule and customizing your business for what you want in your life – is still possible.