The Mental Health Professionals Guide To Setting Up A Private Practice

Private practice is alluring for many mental health clinicians. The possibility of higher earnings, greater control over scheduling and workload, and autonomy over how they can provide care draws many clinicians into private practice. In fact, by 2015, 45% of practicing psychologists and 50% of psychiatrists worked in private practice settings. Starting any small business, including a private therapy or psychiatric practice, requires time to plan and prepare and an ongoing commitment to maintaining good business practices and delivering quality services. Fortunately, tools like a sophisticated practice management platform can make the transition smoother. Read this mental health professional’s guide to setting up a private practice, step by step.

Laying the Groundwork for a Mental Health Private Practice

In some ways, private practice is a business like any other and requires similar thinking and planning before opening the doors. Creating a business plan can seem complicated, but there are a few straightforward steps to get started.

Understanding the laws that apply to mental health practices and businesses in general is imperative. Things like whether you need a business license, relevant zoning laws, and insurance will be specific to your locality. Malpractice insurance is essential and will vary according to the type of mental health professional being insured.

Funding may seem obvious, but extra work at the start of the process can pay dividends as your practice grows. The first two numbers to identify are how much money the practice needs to make to self-sustain and how much money you need to make a living.

Be sure to include the costs of buying or renting an office, licenses and insurance, and a marketing plan.

Deciding whether you will use office staff to run the administrative side or an electronic practice management system will help determine what kind of business you will be (sole proprietor, LLC, etc.) and financially impact your bottom line.

Set goals for earnings for the first few months, the first year, and five to ten years out. Prioritize the ones that are manageable. Set goals that will help you see your progress, and focus your energy where it will pay off, both in assisting patients and growing your practice.

Apply to become a provider through the largest insurers in your area so you can bill and receive payments from them. Being part of an insurer’s network of providers also widens your pool of clients, as insurance companies will often refer patients directly to you.

Network with other therapists and market your business. Word-of-mouth continues to be a primary driver in businesses of all kinds, but even more so when consumers choose a highly personal service like therapy. Having an online presence, participating in community activities, and providing accessible, high-quality care all help grow a healthy practice. For that reason, most mental health professionals choose to work for a hospital or other company early in their careers. The reputations that they build in their professional communities provide solid springboards when they later open private practices.

How to Maintain an Efficient and Effective Private Practice

Once you have a business plan, it’s time to think about how to run your practice. The daily operations can seem overwhelming when starting out. In fact, the administrative challenges were cited in a study of physicians as a major deterrent to starting a private practice.

An increasing number of therapists are running their practices more efficiently by using integrated practice management and electronic health record-keeping systems. This means:

• A digital front door enables new patients to make appointments, complete their new patient paperwork, and enter billing and insurance information through their PC or a mobile app.
• Appointment setup and reminders can be automated.
• Integrated claims and eligibility verification can automatically advance future visits and increase the timeliness and accuracy of billing at the point of service.
• Forms for privacy, consent, and information collection are necessary in any mental health practice. Mental health practitioners also use specialized record-keeping forms. However, creating these can take valuable time away from seeing patients, and it can be complex to make sure all the legal bases are covered. These types of forms are typically included in an integrated EHR and practice management system. Also, the most sophisticated of these platforms regularly update their forms, so you are sure to remain in compliance with the most recent regulations and requirements.
• A significant focus in mental healthcare is evidence-based treatment. Both the American Psychological Association and the American Psychiatric Association promote the use of measurement-based care because of its high correlation with a reduction in the severity of symptoms and better quality of life. However, manual record-keeping to chart longitudinal data about individual patients is prohibitively tedious. An advanced behavioral health EHR platform provides assessments, treatment plans, and progress note templates to streamline measurement-based care practices.

Final Thoughts

Collaborative care between providers is an essential aspect of modern healthcare. Mental health providers are often part of a team spread across various physical locations. Record-sharing can be challenging for both sides when it requires secure transmission of sensitive hard-copy information. A well-designed behavioral health EHR utilizes data portability and interoperability with other programs to integrate the patient’s whole treatment team through the electronic sharing of information. This simplifies referrals between clinicians and enables cross-disciplinary outcome tracking through a secure, HIPAA-compliant platform.

Other benefits of using an electronic practice management system include improved accessibility for differently-abled patients, increased patient engagement, integrated prescription services, and teletherapy options.

At CarePaths, we help therapists work more efficiently and empower them to manage their practice their way by offering online therapy services, online scheduling, appointment reminders, secure messaging, and more. Learn how we can help you get up and running fast. Start your free trial today!