According to the American Psychological Association, nearly half of psychologists (44.8 percent) work in a private practice setting. While it's far from the only option for licensed mental healthcare professionals, it's desirable for a number of reasons. There's a degree of freedom and control that comes with starting a private practice that certain other employment models lack.
As a psychologist, you're eager to see your own name on the door—especially after years of education and exams. But ask yourself this first: Are you ready to start a psychology private practice? Taking the plunge too early can lead to harsh financial and reputational consequences. So, take a deep breath and assess your experience, business acumen, and financial reality before doing so.
Even the best-laid plans go awry. The good news is that business insurance for mental health practices can help protect your investment of time and money. How exactly? Carrying the right mix of policies covers you in the event of liability lawsuits, property damage, business interruption, and more. At the very least, you won't have to pay out of pocket following an event named in your Business Owners Policy!
If you're considering opening your own psychology private practice, get these ducks in a row first.
Estimate Your Overhead Expenses
Private practices require professionals to "recruit their own clients and to cover expenses associated with the practice." Everything comes with a price tag, from keeping the lights on to developing and rolling out online marketing campaigns. To truly predict whether your practice will sink or float, you'll need an idea of how much operations will cost.
Overhead expenses will vary depending on how you configure your practice. Will you pay rent for a commercial office space or operate out of your home? Will you share your commercial space with another practice or go solo? Will you outfit your waiting room and office in new furniture, or try to find lightly used equipment for cheaper? How much do internet and telephone services cost in your area?
Come up with a realistic number so you know how much money you'll need to establish your practice up front.
Narrow Down Your Niche
Of course, a relatively new practice will typically accept a wide range of clients to generate revenue and garner experience. But many practitioners find success specializing in a niche. Ask yourself these questions to narrow it down:
- Where do my passions as a mental healthcare professional lie?
- Do I have the necessary training and skill set to best serve this population?
- Does the market indicate a need for this niche?
- Are there any mental healthcare gaps in my community?
Manage Your Insurance Panels
Nowadays, many patients will only make an appointment with your practice if you accept their insurance. In order to accommodate these clients, you'll have to formally apply to work with insurance companies. And the credentialing process often takes weeks or months, plus lots of follow-up on your part. The American Counseling Association recommends setting aside approximately 10 hours per insurance panel.
Planning will help your psychology practice start off on the right foot. Curious how much business insurance for mental healthcare will cost? Visit CoverHound to find an affordable policy today!