Powering Up Private Practices

Svast’s ‘Powering Up Practice Practices’ initiative fosters a community where private practices can share experiences, resources, and best practices.

Powering Up Up

Private Practices

Private practices are at the heart of patient care, but managing them can be challenging. Svast’s ‘Powering Up Practices’ initiative helps physician owners share experiences, resources, and best practices for better operations, staff management, finances, and technology.

Private Practices Speak

Tune in to 3 mins video podcasts where providers and practice managers share their experiences in managing and growing their private practices.

Private Practice
Resources

Find forms, templates, calculators, KPI list, best practices and more on your finger tips. 

  • Medical Records Management
  • Patient Policies and Acknowledgements
  • Employment and Business Agreements

Frequently Asked Questions

A compilation of question and short answers relating to starting a private practice, managing a private practice and succession planning.   

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The simple answer is no, you do not need to have these studies completed in order to open your new practice. However, having these documents can give a clearer understanding of your financial outlook, can assist in acquiring an SBA, and will be the bases for all of your decision making through the startup process.

You should expect to personally invest at least 10% of the total startup costs for the clinic, so if your business plan calls for $600,000 in startup costs, you should expect to invest at least $60,000 yourself.  Your bank lender will want to see that investment as cash from savings, not borrowed money.  

There are SBA lenders that specialize in medical clinic financing.  My typical advice is to look at the list of the most active SBA lenders and reach out to a few of the banks at the top of the list.  Those are the SBA lenders that have the most experience and are most likely to be able to get your loan approved and through the SBA process.

Typically businesses are acquired based on some multiple of the earnings of the business. For healthcare businesses we see a multiple of between 4x and 5x EBITDA.  EBITDA is your practice’s earnings before interest, taxes, depreciation, and amortization.  So if the practice you are looking to purchase did $1,000,000 in annual revenue with an EBITDA of $250,000 you could expect to pay between $1 million and $1.25 million to acquire the practice.  

The usual forecast shows a loss of $200,000 in the first year alone, so it seems prudent to have some other source of income while you build up to a full panel of patients. There are a number of physicians that will only open the clinic a couple of days per week for the first year and keep another source of income at a day job will building up the new clinic.

Yes. A lawyer will be familiar with all of the business and tax laws in your immediate area. You also want to have legal counsel available after your practice is open for advice.

1. It costs $498 per square foot to construct a new medical office space according to Levelset.  So if you are looking at 1,500 square feet of new construction, you can expect a total cost of approximately $750,000 for a stand alone medical office.  2. If we assume a 2024 rate of $28 per square foot with a 1,500 square foot office you can expect to pay monthly rent of $4200. 3. It costs between $250 per square feet to renovate a medical office according to InvoiceOwl.

According to Medscape, the average primary care practice will need 1,200 to 1,500 square feet of medical office space for a single physician practice.

According to AAFP, The average primary care physician will need 3 exam rooms and 1 procedure room in order to operate most efficiently

Many new practices fail, here are the top five reasons:

1. Doctor’s Underestimate the Work Involved

2. Low Client Satisfaction is a Rampant Problem

3. The Medical Practice Isn’t Unique or Informative

4. Lack of Planning for Future Growth

5. Not Being Flexible or Adaptive.

The process to start up a new medical practice involves a lot of steps. You should give yourself enough time so that the experience is not overwhelming and stressful. The ideal time would be 12 months before you want to start seeing patients. With that being said, many providers have opened new practices in as little as 6 months.

Essentially, there are three ways to acquire patients for your practice: 1. Advertising 2. Organic search 3. Referrals.

These services allow you to generate more revenue from the same patient base.  Typically medspa services are repeat services as well which means you can potentially increase your revenue per patient per year quite dramatically.  

Specialized equipment is only needed if you are going to be offering specialized services.

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It will depend on things like how many patients do you expect to have to start off with, how many employees will you start off with, what is your rental cost, will you need to pay yourself from the business or will you live off of outside income or savings?  All of these questions will determine the answer to how much working capital you need for your specific situation. Based on the set of assumptions for a single physician opening a new clinic with no patients to start with and two employees and the estimate that you would need is $350,000 in working capital. 

A primary care physician that owns their own practice can pay themselves $300,000 per year according to InvestingDoc once the practice is full. 

You can start paying for yourself from day one if you ensure that it is a line item on your proforma and you have the capital to cover it with your SBA

It may take 20 months to reach cash flow breakeven for a startup medical office. 

1. Advertising 2. Bookkeeping 3. Credit Card processing fees 4. Insurance 5. Rent/ mortgage 6. EMR/PM software 7. Office supplies 8. Medical supplies 9. Utilites, phone, and internet 10. Medical billing and coding services

A fee scheduleis normally based on a percentage of Medicare Allowable Fees. We recommend 150% - 200% be set as your Fee schedule to ensure you are collecting the most you can from commercial insurances who tend to pay more than Medicare. Keep in mind though, the higher you set your fee schedule, the more you are going to have in contratcual write-offs.

According to the Bureau of Labor Statistics, the national average annual wage for an MA is $40,700 and for a Medical Receptionist is $31,960

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Typically, one primary care provider can sustainably support 1,200 to 1,900 active patients. To know if your practice is sustainable, you can look at the population numbers versus the number of primary care providers in the area.

On average, a doctor can see between 20 and 30 patients per day according to Excel Medical.  This means that if you see patients 4 days per week for 50 weeks you can have a maximum of 5000 patient visits per year.  

Between 15% and 23% of scheduled doctor’s appointments are no shows according to Tine Health. 

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Straight Salary (plus bonus), Production Based Models (ie: billable seervices, procedures, patient visits), Revenue less Expense, Performance based Model (Quality metrics).

Recruiters can be very helpful in the search for new employees. If you are considering having several providers and the staff to cover that, then the process can become overwhelming and a recruiter would be very helpful. On the other hand, if you are opening as a solo provider with one or two staff members, it is reasonable to do this on your own.

For a startup practice that needs to build a patient population, one assistant to start would suffice as long as they are knowledgeable in both front and back office duties. As the practice becomes busier, another like position can be added.

1. Front Desk Staff 2. Dedicated phone staff (triage) 3. Nurse/ MA 4. Lab tech 5. Billing specialist 6. Transcriptionist/ Scribe 7. Practice Manager 8. Referral Specialist

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1. Choose an ONC Certified EMR system. 2. Interoperability and Integration. 3. Usability: user friendly product is essential for not disrupting the office workflow. 4. Support: ensure that the EMR company has a good support system to communicate with for Q&A and System Down difficulties.

Office supplies can be acquired from any company that offers the best pricing.

The two major companies are McKesson and Henry Shein, but if you look for bargains you can find them on most supplies needed.

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Malpractice Insurance, Employee Health Insurance, Employee Practices Liability Insurance, General Business Liability Insurance, Worker's Comp Insurance.

While I certainly understand the upside for the physician and the simplicity of private pay only, I think for most practices you will need to accept insurance in order to reach a full schedule of patients. 

Options for providers who do not want to contract with insurance payers have several options to consider; Self pay patients: those who pay for services out of pocket. DPC Model: patients pay a monthly fee for services.

Credentialing can take 60-180 days.

Yes. This Group NPI sets your practice up for long-term growth and enables you to begin credentialing with commercial and federal payers.

The credentialing process should begin as soon as you have a physical address, an NPI, and a TIN.

Research of your general area should be completed to consclude which of the payers have the largest populations in your area. You should always start with Medicare and Medicaid and then add in your top 3-5 private payers to get started.

Accountable Care Organizations (ACOs) are groups of doctors, hospitals, and other health care providers, who come together voluntarily to give coordinated high quality care to the Medicare patients they serve.

A clinically integrated network (CIN) is a group of healthcare providers that work together to deliver efficient and affordable coordinated care to patients. The term “clinically integrated network” refers to a distinct legal entity.

A medical practice that is going to be doing Point of Care testing, (ie: throat and nasal swabs, urine dips, fingersticks…) need to have a CLIA Waiver Certificate before performing any of these services. A practice that is going to process complex tests with sophisticated equipment require a CLIA Certificate.

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Certificate of Registration: Issued to a laboratory that conducts moderate or high complexity laboratory testing until the entity is determined to be in compliance with CLIA regulations.
Certificate of Compliance: Issued after an inspection finds the laboratory to be in compliance with all applicable CLIA requirements.
Certificate of Accreditation: Issued based on the laboratory’s accreditation by an approved organization.

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On average it should take a healthcare provider between 30 and 70 days to get paid after billing for a service.  If you have a high performing billing department 30 days is the gold standard, but the average is probably more like 45 days. 

On average you should expect it to take 30 to 60 days to get paid by government payers like Medicare and Medicaid. 

Concierge medicine, also known as concierge care, boutique medicine, retainer-based medicine, platinum practice, or direct primary care, is a membership-based healthcare model. Here’s how it works: 1. Membership Fee: Patients pay an annual fee to their physician’s practice. 2. Limited Patient Panel: Doctors limit the number of patients they accept, allowing them to spend more time with each individual. 3. Exclusive Care: Patients receive personalized care, including unlimited office and telehealth visits, direct access to their doctor’s phone line for medical questions, and simple diagnostic tests. 4. No Insurance Interference: Concierge medicine operates independently of insurance or corporate health systems. It’s an appealing concept for both doctors and patients, offering a more personalized and accessible healthcare experience compared to traditional primary care practices.

Also known as DPC, is a practice and payment approach where patients pay their physician or practice directly through periodic payments for a defined set of primary care services. Unlike traditional fee-for-service billing, DPC typically involves low monthly fees that cover extended visits, clinical and laboratory services, consultative care, and comprehensive management. Physicians benefit from simplified revenue structures, reduced administrative burdens, and increased time with patients. It’s a patient-centered alternative that emphasizes quality care and affordability

Frequently Asked Questions

A compilation of question and short answers relating to starting a private practice, managing a private practice and succession planning.   

Upon contract signing, we can initiate the setup process promptly. Typically, for most physicians, this process is completed within 2 to 4 days. A precise estimate can be provided after assessing the specific requirements of your individual practice.
Certainly. Unless the nonpayment is due to a valid reason, such as a deductible, capitation, lack of coverage, or duplicate invoicing, we can reprocess the claim without needing additional information. If required, the Svast team will reach out to your office for any necessary details. If the claim persists as unpaid, we will proceed with the appropriate appeal process.
Certainly. Our data migration teams collaborate closely with new clients to facilitate a seamless transition. We furnish the essential templates to your former billing company, guiding them to compile data in a format compatible with our system. Once we receive the data in the required format, we'll handle the import into our platform at no additional cost to you.
Far far away, behind the word mountains, far from the countries Vokalia and Consonantia, there live the blind texts. Separated they live in Bookmarksgrove right at the coast

Private Practice Resources

Find forms, templates, calculators, KPI list, best practices and more on your finger tips. .

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No Show Policy

No Show Policy template in editable word file format. 

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Employee Handbook

Employee Handbook template in editable word file format. 

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Consent To Treat

Consent To Treat template in editable word file format. 

Trusted Partners

Explore our curated list of third-party professionals in Real Estate, Consultation, Finance, and Legal services, dedicated to supporting healthcare practices.

Private Practice Helpline

Don't worry, we're here to assist you. Call us today for a free, no-cost consultation from our experts and discover how we can help you. Let us help you streamline your operations and ensure you receive the payments you deserve!


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Still having issues? We're here to help!

Don't worry, we're here to assist you. Call us today for a free, no-cost consultation from our experts and discover how we can help you. Let us help you streamline your operations and ensure you receive the payments you deserve!