The Biz of Health: 4 Crucial Aspects of Opening a Clinic
Before opening a clinic, business owners must first carefully plan and research in order to ensure a successful operation. Here are four key aspects that must be understood before opening a clinic.
Understand Health Care Consumers
It is necessary to evaluate the local market and know how many potential health care consumers are in the area. Through properly sizing the market, health care providers will be prepared to set their availability and office hours. Besides population, clinic owners must have an accurate estimate of how many people will seek care and how many similar clinics and doctors there are in the area. For those opening a clinic in a remote area, they must know how far the average health care consumer is willing to travel for treatment. There are excellent sources of demographic data available through the U.S. Census Bureau’s website.
Research the Competition
Living in a densely populated urban area increases the number of potential patients, but also comes with successful, well-establish competitors. Evaluating the competition is a crucial part of the research process. Clinic owners will need to know how many similar clinics are in the area and the factors that have contributed to their success. Being geographically close to hospitals and health care organizations that accept popular insurance plans is also very important. Certain health care clinics, such as physical therapists, must be aware that insurance panels and companies limit the number of providers in designated areas.
Know Standard Benefits and Compensation
Insurance benefit rates and provider compensation rates vary across different states. Financial expectations must be aligned with acceptable compensation rates and overhead costs. Clinic owners must accurately forecast how much will be paid per visit and how much will be written off because of denials, adjustments and lack of patient payments. Insurance providers, industry experts and health care alliances are excellent sources of information for standard benefits and compensation rates.
The Total Cost
The biggest question that every potential clinic owner will want to know is the total cost of opening a clinic. Sometimes, clinics may only cost under a $100,000, but it in areas with high salaries and real estate prices, it will cost up to $400,000 to start a clinic.
Once the research is finished, develop a comprehensive business plan that defines the business scope, strategies and financial goals.