Key Considerations for Starting and Running Your Private Practice
The private practice landscape is changing rapidly, driven by payment reform, regulatory changes, new technology and consumer demands, among other factors. Given this, it may be confusing—even intimidating—for physicians wishing to run their own private practice. That’s why the American Medical Association is here to help.
We take you through the critical steps of the process and highlight key considerations and resources, so you can start off right on the path to success in private practice.
Eight steps to starting a private practice
It’s important to reflect upon “why” you want to get into private practice, as well as the challenges you may face. If you find the answer after consideration is “yes,” the next step is to create a plan.
The process of designing a business, raising money and acquiring office space and professional tools will take time. A stepwise approach can empower you to find a practice arrangement option that matches your priorities. Here are eight steps to consider (PDF) when starting on your journey to private practice:
- Strategic planning: This is the most important part of starting and sustaining a medical practice, as it outlines fundamental decisions and actions that shape and guide what a practice is, does, and why it does it.
- Location: Take stock of the local market and assess the needs of the population in that area.
- Licensing and credentials to practice and prescribe: Start as early as possible to complete any requirements.
- Professional advisors and peer collaborations: Consult the correct advisers for their expertise in legal, financial, compliance and information technology matters.
- Payer contracting and payment models: Identify desired payment models for the practice.
- Professional insurance: Consider insurance policies commonly available to businesses.
- Equipment and supplies: Include all the items for your procurement list to care for patients.
- Staffing: Use industry benchmarks to determine how best to staff your practice.
Strategic Planning
A strategic plan should outline fundamental decisions and actions that shape and guide what a practice is, what it does, and why it does it, all with a focus on the future. A large component of the planning phase should focus on understanding the business of medicine. To help you determine start-up expenses, develop a monthly budget, and assess evaluation and management revenue for a traditional physician practice, review the AAFP’s Starting a Practice Tool. Templates for tracking startup costs, a monthly budget and understanding revenue by payer are included for your reference.
RESOURCE: AAFP’S STARTING A PRACTICE TOOL (in folder)
Location
Where a physician puts down their practice’s roots is a crucial step in making the dream a reality. Take stock of the local market and assess the needs of the population in that area. Determine whether buying or leasing property is best. Once you settle on a geographic location and real estate plans, work with an experienced commercial realtor to select the ideal space. Ensuring a location meets all high-priority needs will go a long way toward the practice’s success.
RESOURCE: FACTORS IN SELECTING A PRIVATE PRACTICE LOCATION ( in folder) – FIGURE 1
Licensing and Credentials
Physicians must be both licensed and credentialed in Louisiana in order to practice medicine. To practice medicine in Louisiana one must have a Doctor of Medicine or Doctor of Osteopathy and passed the following board exams:
- State board examination
- National Board of Medical Examiners (NBME) Parts 1, 2, and 3
- Federation Licensing Examination (FLEX)
- United States Medical Licensing Examination (USMLE)
- Comprehensive Osteopathic Medical Licensing Examination of the United States (COMLEX-USA)
- National Board of Osteopathic Medical Examiners (NBOME)
A physician may be licensed to practice medicine without passing a specialty board exam. As a Family Medicine physician, your initial specialty board certification takes place through the American Board of Family Medicine (ABFM). The criteria can be found on the ABFM’s website.
License to Practice Medicine
The Louisiana Board of Medical Examiners (LSBME) is responsible for determining the qualifications of applicants for licensure, enforcing the medical practice act through the rule making process and renewal of licenses to practice. The LSBME has a dashboard, LaMED, which assists applicants in keeping up to date on their application and the process. For more information on licensure, go to the LSBME website.
Prescribing
A licensed physician may prescribe non-controlled medications. In order to be able to prescribe controlled substances per Title 21 United States Code Controlled Substances Act § 802, a physician must obtain the following:
License from the Drug Enforcement Administration (DEA)
DEA licenses are granted by the DEA’s Diversion Control Division. For details see https://deadiversion.usdoj.gov/index.html
Controlled Dangerous Substance (CDS) license
CDS licenses are administered by the Louisiana Board of Pharmacy. For details of application see https://www.pharmacy.la.gov/