Things to consider before opening your own medical practice
You have studied for what feels like an eternity and you have completed your internship. Perhaps you have even worked for a few years at a hospital and maybe specialised. But now you are ready and wanting to step out on your own as a doctor, with your own private practice and rooms. It is a very exciting dream and an amazing opportunity, but it is one that requires a lot of consideration and thought. In essence, you are being an entrepreneur, setting up your own business and going out on your own. In recognizing this you also need to recognize that there is a lot of planning that needs to take place and a lot of expenses that need to be incurred. This is not meant to put you off, it is meant to help, so, without further ado, here is a quick list of things that you should be legislating for when starting your own medical practice.
You cannot run a practice without equipment. Most doctors will require a lot of equipment but even those who don’t need too much, like psychiatrists, will at the very minimum need a couch. It is things like beds and kidney dishes and sample jars and Omron BP monitors, stethoscopes and waiting room paraphernalia. It all adds up quite quickly and becomes quite a significant amount that has to be shelled out for set-up costs. Try to save for this in advance rather than buying on credit – you will end up paying a lot more for it if you opt for the latter route.
Almost every practice will require at least one person to work for it. And, it probably goes without saying, that is in addition to the doctor him or herself. At the very minimum a receptionist is needed – somebody who will handle appointments, work the billing and make sure that everything front-of-house runs smoothly. Depending on the nature of the practice you may well need more people to help. Perhaps not full time, but IT consultants to handle the computers, a financial person to do the books and maybe even cleaning staff. It all adds up quite quickly.
Think long and hard about all the financial aspects of setting up your own health practice. It is not just a case of seeing patients and watching the cash roll in. Rent and malpractice insurance are huge costs. So too the salaries of staff. But what happens if you are ill or incapacitated for a while and not able to see patients? You need unemployment insurance and your own medical aid and pension. You also need to factor in the fact that cash flow might not be great in the beginning – especially if your clients are paying via medical aid and not cash. The reality is that overheads can be high, and you will have to work extremely hard to ensure that you get in more than you need to spend. In terms of planning your business make sure that you spend enough time doing the financial plans so that you know what to charge and when you break even.