Starting a Medical Practice : 6 Essentials

Starting a Medical Practice

by
September 17, 2016

Starting a medical practice¬†is a very exciting time in a physician’s career. Having a private medical practice allows doctors to control their own schedules and oversee their own employees.

Physicians can also make their own decisions when it comes to running and operating a business. With these benefits, however, come a lot of responsibilities.

Specifically, there are a variety of legal and professional requirements associated with starting a medical practice. Failing to follow these requirements can lead to many legal and professional consequences.

Create a business plan to help organize your thoughts and plans for the business, while ensuring all governmental requirements have been complied with. Also consider the following information before starting your new medical practice.

1. Choose The Right Legal Entity   

Choose the legal entity best for you.

Choose the best legal entity to protect you and your practice.

The most crucial step to take before starting your medical practice is choosing what type of legal entity to create.

Be sure to form a corporation LLC or corporation to ensure you receive the maximum protection allowed under the laws of your state.

Be sure to contact a professional when deciding the type of entity to form.

Depending on the state of licensure, there are many laws governing the type of entity that may hold a medical practice and a professional who is familiar with these laws is imperative when making this decision.

Some states only allow doctors to form specific types of entities.

For example, California medical doctors may only form professional medical corporations (PCs).

In states like New York, medical doctors have the option of a PC, professional limited liability partnership (LLP), or professional limited liability company (PLLC).

Once formed, professional entities are subject to most of the same requirements associated with regular corporations and LLCs. For example, they must obtain a taxpayer identification number, hold annual meetings and pay appropriate taxes.

2. Malpractice Insurance 

Obtaining malpractice insurance for your practice is imperative

Obtaining malpractice insurance for your practice is imperative.

Having a good malpractice insurance policy is the best way to guarantee financial protection against potential suits arising out of malpractice.

Although corporations can provide liability protection, they do not always provide any protection against malpractice suits.

A physician is held responsible for any and all negligent acts arising out of his or her conduct in relation to their physician capacity.

Doctors can be found negligent for anything from a minor injury to death due to a minor mistake during a minor procedure.

Malpractice insurance protects these doctors in cases where he or she is held responsible for losses, damages or injuries arising from their practice.

It is vital to physicians who can make mistakes that may be debilitating or fatal to the patient.

Physicians held legally responsible for their mistakes may be required by the courts to pay hundreds even millions of dollars in damages.

Without proper malpractice insurance, the money will have to come from the doctor’s own pockets.

Although not required in all states, having malpractice insurance provides a sense of peace that a physician can focus on providing their services rather than stressing out about potential suits.

3. Hiring Staff & Employees 

Make sure to hire efficient and reliable staff members who help your practice grow.

Make sure to hire efficient and reliable staff members who will help your practice grow.

Hiring the appropriate staff is crucial to your medical practice. It is important to find trustworthy and reliable staff members who you can rely on to help run and expand your business.

Staff members can include anyone from receptionists and bookkeepers to other physicians.

Because hiring the wrong staff can be both expensive and time consuming, it is imperative you hire the most motivated and dedicated individuals.

Before doing so, take time to review their references and do background checks to make sure they are a suited fit with your practice.

These individuals will have access to patients’ medical records, billing information and other confidential information that can be devastating¬†if breached.

To ensure your staff comply with your practices’ expectations, create an employee handbook that outlines your company expectations, policies, and consequences for violating any and all company policies.

Also be sure to execute an employment agreement which outlines the terms and conditions of the employment. A properly drafted employment agreement can help protect a doctor in case of an employee lawsuit.

Lastly, physicians hiring employees should consider providing health, workers’ compensation, unemployment, disability and malpractice insurance that will¬†absolve them from any suits and claims arising out of their employment.

 4. Comply With Licensure Requirements

Make sure you and your employees comply with all industry requirements

Make sure you and your employees comply with all industry requirements.

To maintain their medical licenses with the medical board, physicians are required to comply with many healthcare rules and regulations.

The most notable requirement is¬†the Health Insurance Portability and Accountability Act (HIPAA) which protects the privacy of individuals’ health information.

Many medical practices and physicians are audited every year in an attempt to reduce Medicaid fraud and overall abuse of the healthcare system.

In order to avoid audits and decrease the potential damages associated with being audited, it is important to implement a system that all employees and staff must comply with.

The system should outline all industry standards and requirements and what steps must be taken to ensure compliance.

For example, your practice must provide guidelines on how to comply with HIPAA while providing safeguards to protect against unethical billing practices and unwanted and inappropriate relations in the office.

5. Marketing is Essential to Starting a Medical Practice

Make sure you

Spending time and money developing a marketing strategy will yield great profits for your practice.

Today, running a profitable practice is very tough because of all the competition. To set themselves apart from other physicians, doctors must invest time into marketing with an entrepreneurial hat on.

There are many approaches a doctor can take to actively seek out new patients.

For example, offering free services such as check-ups can bring new patients through the door while providing good customer service and care can maintain them as permanent patients.

Lastly, physicians can use social and in-person networking to create a referral system that generates new patients every month.

Social media is a great tool to market your services and get in touch with other professionals in the industry who can help refer new patients.

ALSO SEE:  5 Business Mistakes Commonly Made By New Businesses

6. Practice Essentials

Make sure you cover all the business essentials before starting your medical practice.

Make sure you cover all the business essentials before starting your medical practice.

Location, location, location! Choosing the right location to open your practice is key to a successful business.

In addition to the size of the place, it is important to consider available parking, walk-by client potential, surrounding competition and the demographics of the locals.

In addition, purchasing the best equipment, supplies and technology infrastructure for your practice will yield a much greater profit for your business.

Equipment that is reliable and efficient will reduce the time spent fixing mistakes and increase productivity in the office.

Because medical equipment can be expensive, it may be smarter to rent larger items rather than purchase them.

Conclusion

Before starting a medical practice, consider the provided information. It is a very thrilling time in a physician’s career but can be dangerous if not thoroughly thought out.

Be sure to consult with a professional, as much as possible, to avoid making any mistakes.

 
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