You worked through years of medical school and residency. After months of studying and stress, you’re a state-licensed, board-certified dermatologist…maybe you’ve got a bit of debt to deal with…now what? ?♂️
You could look for a position in an existing medical group or practice, because hey that’s got to be simpler/easier right? After a bit of thought, you decide perhaps you don’t want to be beholden to the seniority structure or the pocketbook of a private equity group (Or maybe you’ve already chosen this route and you’re fed up/ready to spread your wings!). So…you decide the time is ripe to start your clinic! You need to develop a winning dermatology practice business plan. You’ll get to all the details later, cart first…horse be damned. Let’s get this thing set up ASAP so you can start treating patients!
Where To Begin?
You may be a fantastic physician, quite brilliant, and you may even put the term “hard working” to shame…but there is more to a dermatology startup than you think. Your practice is a massive small business the day you open your doors. Think about it…how many small businesses have the capability to generate AT MINIMUM half a million dollars without fail? You’re immediately operating at scale. This is an absolutely unique challenge. It requires a unique solution and expertise/experience can be invaluable…as can moving in a calculated, pre-planned, not-lightspeed pace.
Think about finding a service to help get you where you want to be like KZA, BrinsonAnderson, MD Practice Partner…or maybe Auctus? Full disclosure – we don’t do the “start-up” projects. We take a consultative approach to the service lines our clients select and throw in our knowledge/expertise where applicable and/or depending on the day you catch John if he’s feeling like prattling on or not about the topic du jour. When we take on consulting projects, we have a defined scope and a measurable deliverable (e.g., provide a billing evaluation, manage a dashboard buildout project, evaluate and launch a new EMR). If you want accountability, captainship, driving…take a look at one of the groups we recommended.
So what does success look like for a startup plan? It requires thinking about issues like billing and coding practices & developing the best possible support team. ? This is a brief article, with a few nuggets of information…this is NOT a roadmap in and of itself.
Start with the Right Location
We’ve all heard the old adage: Location, location, location. Consider doing a competitive analysis of your area to when looking at launching your derm practice. If you decide to open up in an oversaturated area you’ll be competing against every other practice in addition to the challenges of starting a practice. Treading water is not a recipe for success.
Pay attention to your competition too. Are they private practices? Hospital owned? PE backed? The amount of money behind the competition and the type of practice they are can be helpful in assessing your prospective success. Are you opening in Miami Dade where you’re in the most saturated market in the US? Are you opening in a rural hospital dominated community where partnership with that hospital will be crucial? Are you opening in an area with heavy big box practices so the unique/customer centric approach may help you stand out?
Also – I know we don’t want to have to dig into the boring/aggravating stuff…but think about your insurance contracts before Day 1. You need to know what to expect from payers. Are you going for Medicare/Medicaid/Replacement policies? Are the commercial panels even open in your area? Is there a delegated contract model you can access. Know this up front. Your contracts define your reimbursement. This is your cashflow. If you don’t have your contracts up and haven’t planned for the rates you’ll be paid at…it can cripple you right from the start.
It Takes Longer Than You Think!
As you plan for your practice and consider your personal finances, you should know that there will be some time before you can see patients. Whatever length you imagine, multiply it by two or three for a realistic timeline.
Basic tasks like leasing property, contracting with insurance companies and obtaining malpractice insurance are all multi-step processes that take months. When have you ever heard someone talk about how “construction went off without a hitch and the job was done ahead of schedule?” Have you ever had a colleague tell you “boy oh boy it was just so easy and convenient to deal with insurance contracting…in fact they even offered me great rates from day 1.” Plus you’ve got to set up a relationship with every single vendor under the sun from your shredding service, to your CPA. These things take time to research, review and execute.
For insurance contracting, you should expect 90 – 180 days for the commercial payers to move worst case scenario. Some CAN come back in as short as 30-60 days, but if you plan for the fastest timeline and those knuckleheads screw up…you’re on the hook. They will not backdate because you complain…more than likely they don’t even have a person on the other end of the phone to complain to…just a generalized email inbox. May as well scream into your pillow…you’ll find more support.
As you fill out the forms and take the steps to make your practice a reality, allow yourself some grace and your time. A stupid mistake on your end will add days/weeks to the process ? especially if you haven’t given yourself much wiggle room.
Support the Practice with Capable Software
User-friendly software has become essential to a successful dermatology practice. These platforms can perform tasks that used to be time-consuming and prone to human error. It is just a reality these days folks. You need an EMR. We won’t bore you with the gory details here (click the link for more)…but suffice it to say, everyone’s got one and no one is in love with theirs.
The take home: Implementing a new software system also takes time. It may take four to six to eight weeks to get everything functioning as it should. Those are the vendor timelines. Think about training your team too. You’ll want them up to speed before day 1 not learning on the fly. Junk in. Junk out. Keep your software clean from day one by having your team properly prepared with the right timeline.
Billing and Coding are Keys to Success
Every small business needs income to stay afloat, and your new practice is no exception.
As you consider how to open a clinic, billing and coding will loom large. These tasks are the keys you need to unlock payments. ? Improper coding leads to improper billing. Remember the whole thing where the US healthcare system sucks because it is so overcomplicated that medical billing is a nuanced industry that exists just to get MDs paid for their work. Yeah…that part. Get your billing team/company teed up early. Think hard about making sure that the team that does your contracting/credentialing is also your billing company if feasible. The last thing you need is two vendors quibbling about who’s fault it is that your claims aren’t getting paid while your bills stack up. Handling these mistakes will cost your practice both time and money, and failing to correct these mistakes can lead to serious consequences.
So, get you a biller who can do both!
A Strong Staff Makes a Strong Dermatology Practice
Your people are your practice. You may be the reason the patients show up, but they will be interacting with your team more frequently and at more touch points in the life cycle of their care regimen at your practice.
Think about paying for experience and offering a job role with benefits so your team don’t even want to look elsewhere. Benefits may not be just health insurance, but an organized PTO policy with a handbook, or a strong company culture focused on ongoing training/development, or even just having off hours booked so your team can catch up on the wake of paperwork you leave behind (yes, you leave a WAKE of paperwork/activity and it is more than you think).
A strong, well-picked staff will take your clinic to the next level of customer service.
Are you having trouble finding qualified people to handle your billing needs? ?
You may want to consider outsourcing this task. It’s going to add to your bottom line, but you can relax knowing that this mission-critical job is being handled by people who do nothing but billing and coding all day.
Finding a Partner for Your Practice
If you are starting a new dermatology practice, you have a challenging road ahead of you.
However, you don’t have to go it alone. At the Auctus Group, we work hard to optimize your clinic. Our consultants will assist you as you design your workflow and train your staff. We have teams dedicated to clinic billing and bookkeeping.
Contact the Auctus Group today, and let us be a partner for your success. ?