What do you need to know before starting a private practice?
Know your numbers, and talk to experts that understand the business better than you.
Does it matter if I am an NP, DO, MD, DC can I start a private functional medicine practice?
Anyone with a license can start a private practice.
How do I prevent embezzlement in my practice?
Manage your money carefully and be on top of where your money is going.
Do not miss these highlights:
01:26 How Dr. Deb started her own private integrative medicine practice 12 years ago.
02:44 It takes a huge leap of faith to be able to go into private practice for yourself. Have faith in yourself and trust that you can learn absolutely anything you put your mind to.
04:49 Private practices are up 6% since COVID, just in the first quarter of 2022 patients want to see per providers in private practice.
05:30 Don't be afraid to ask people that are experts - Ask people around you for their guidance, ask questions so you understand what you're doing and what you're liable for.
09:43 You can get more people in faster and have more money in your practice by not having that long waiting list.
11:04 If you build a good reputation, spend time with your clients and get them results, more people will come because word travels.
11:43 Don't niche down your market so narrowly that your patient population is limited.
12:12 Find your ideal client.
13:40 Know your numbers - You have to know the financial health of your practice, your numbers tell the health of your practice.
Join Us in the FMBI Mastermind Group on Facebook. You can find the Group at https://www.facebook.com/groups/5461914567153276/
Transcript of Episode #32:
You're listening to the Functional Medicine Business Podcast featuring Dr. Deb, one of the most creative functional medicine business practitioners in her industry. She shares the wisdom and knowledge that she has gained over 25 years of functional medicine, a pioneer in functional medicine, scheduling, leadership and Practice Management. Dr. Deb has a wealth of knowledge and he's eager to share to help functional medicine become more productive, and for the practitioners and patients to live better lives. Our podcast shares the good and the bad of our industry because Dr. Deb knows the pain you live every day building a functional medicine practice with practical tools of how to manage money, taxes and patient care. She will discuss it all with you.
Welcome to the Functional Medicine Business Podcast, FMBI. I'm your host, Dr. Deb and today's episode is the three keys to my success as a private practice nurse practitioner, we're going to talk about those exact three key steps to building a private integrative medical practitioner. So if you're a nurse practitioner, naturopath, physician, chiropractor, or do who is interested in starting their own medical practice, these tips are for you. Keep watching. I started my own private integrative medicine practice about 12 years ago, after I left another practice, I was an owner in this other practice by wanted to create a practice that shared like minded practitioners under the same roof. The goal was to share knowledge patients and provide a practice that could eventually run without me. When I tell you I was scared, that's an understatement. I remember telling my husband that we may not be able to survive, I didn't know how long it would take for me to collect a salary from this business. And it kept me up at night. I'm just going to throw it out there. Because we're all practitioners, whatever field you're in, we like to have a lot of data at our disposal. For our patients. We like to evaluate numbers, look at the evidence and make guided decisions. When you graduate from school, you don't get any business training, nothing, not how to hire staff, evaluate health insurance, sign up for accounts with vendors, how to set up a QuickBooks file. The only thing we're competent in is taking care of patients. So yes, we're unprepared to open a private practice.
So honestly, it takes a huge leap of faith to be able to go into private practice for yourself. Because we like to have all that information at our fingertips. And we weren't taught any of this. You're not taught how to write a business plan, how to ask the bank for money, how to create a pro forma, how to get on insurance plans? Do you need malpractice or disability life insurance? And how do I use that life insurance to build my business? How do you get the best staff when you get patients to your practice? How do you start a business when you have no idea what being a business owner is all about? I spent five years in another practice before I started my own business. So I was a little more prepared than most people when they decided to go into private practice. But honestly, I was still so unprepared. Let me tell you that anyone can learn this if you want to. You just need to have faith in yourself. Trust that you can learn absolutely anything you put your mind to. Everything is available to you online. But sometimes that information online is so overwhelming, that it can make you more confused and leave you frozen. In order to get your business off the ground.
You're going to have to do a lot of extra work on nights and during the weekend. Learning how to be a business owner means you need to learn how to use QuickBooks. You need to understand reimbursements. What's a 3060 or 90 Day AR? These are all the topics I'm going to keep addressing in our podcast. And I will also hold you hold your hand in all of this in my functional accelerator training program. The key to your success is to enter this with an open mind that you can learn this information. You're smart this may seem foreign at first, but it will become second nature.
Did you know that private practices are up 6% since COVID, just in the first quarter of 2022. Patients want to see per providers in a private practice. They're tired of the big box, big brother health care system. They want to know they can have a relationship with their practitioner and they're not limited to have services provided simply because the big brother says they can. All right. All right, I'll get off that soapbox. You're all smart. You've all finished graduate school, finished your residency, you can handle this. Don't be afraid to ask people that are the experts. So you can pick their brains about things you don't know as much about. So for instance, my first year in practice back in 2010, which sounds very crazy and overwhelming right now. I had a great accountant who taught me how to read a p&l, a profit and loss statement. They showed me how to reconcile credit card statements each month, how to make journal entries. And when I started, there wasn't much YouTube. So learning things wasn't as easy as it is today. But I figured it out, I figured out how to use QuickBooks, how to create a balance sheet, what a balance sheet really was and what it meant. And what a p&l statement was. I learned that when I purchased equipment that went in a different category, from a tax perspective than just a tax write off, it was a depreciation. I learned all the things that could be tax deductible. And then I learned from another experts that many things I didn't think were tax deductible actually were.
Ask people around you for their guidance, ask questions, so you understand what you're doing and what you're liable for. Trust me, it's the worst feeling in the world. If you get hit with a big financial surprise, at the end of the year. Don't always assume your accountant knows more than you. They might at first, but as you learn more, you'll know just as much of them, if not more. I've had multiple accountants over the last 10 years. And I can tell you, there are things I know that they don't know. And the things that I do know, save me a ton of money. Now, did I learn that just by myself? Absolutely not. I learned from experts. And they taught me ways to save money, grow my practice, and teach my accountant a thing or two. I asked my lawyer and my bankers questions, I hired mentors to teach me to be a better business person. I searched the internet to make sure that what my accountants told me was accurate. And guess what, that wasn't always the right advice that I got. I actually taught them more things. This last year, I had a huge loss, I was part of a Ponzi scheme. And my accountant said, you can only write off $3,000 a year up until the max. Well, let me tell you, I would be paying that off for decades. But I found that he was wrong. Because it was a true Ponzi scheme. And it wasn't just investment loss, I got to write off the entire thing in the year that it happened. That's how we learn new things. "Trust, but verify" is my model.
Being a business owner is a different way to thinking about things. You're so capable of learning. You just need to set your mind to it, you will be able to handle it. Honestly, you're not just concentrating on diagnoses now. Now you're really trying to run at the health of your practice. You're trying to run a business that can eventually run without you. You're trying to create a legacy for you, your family, and you're trying to create something that will be in existence long beyond your ability or your desire to practice. People ask me all the time, how did you build such a successful practice with a six month waiting list? How do you become so successful in your community? I develop this waiting list early on. And then as we grew, I brought on other providers so our waiting list reduced. Now I will say it's great for your ego to have a six month waiting list, but it's not good for your bottom line. It's not good for your reputation, and it's not good for your patients. You can get more people in faster and help them have more money in your practice by not having that long waiting list. In today's market, there are many health care practitioners that can help people. I lost patients because I had a a six month waiting list. Ultimately, those patients came back around to see me. But by that time, they had already seen five or six other practitioners spent $50 to $100,000, in their health care, didn't have any money left, didn't have any time and didn't have any belief in themselves or anybody else that they could get better. So although that waiting list is wonderful for our egos, like I said, it's not good for the patient. And it's not good for the bottom line. So as your practice begins to grow, and you have that longer waiting list, that's when it's time to start looking at bringing in another practitioner, training them, and getting them to be helpful in your practice to get patients through the door and get the services that they need to heal.
I remember being terrified when I started out that my patients from my previous practice wouldn't follow me. But that fear was nothing they followed and brought their friends. If you build a good reputation, spend time with your clients and get them results, more people will come because word travels. Now there's lots of different aspects to patient care, getting the correct diagnosis, just one that really works is truly caring for your patient. This sounds old fashion, but it makes all the difference in the world, your reputation will build and I promise you, your practice will build very naturally, very organically, even if you've done nothing else, but care.
I tell people don't niche down your market so narrowly, that your patient population is limited. If you want to find your ideal client and take care of them, not just one or two diagnoses, take care of the patient in front of you. You can be an expert in one or two areas. But make sure you take good care of your patient. If you don't truly know something, refer them to someone you trust that can help them. But find your ideal client. And I'll do a podcast on this so you know exactly what I'm talking about when I say your ideal client. When I started out, I had a tiny website, I wrote a bunch of blogs, I lectured at compounding pharmacies to attract clients. I didn't have an advertising budget until I was in business for seven years. I never paid for TV or commercials, I didn't pay for ads until I got to the point that my business was making $2 million a year in revenue. I didn't do YouTube videos, I didn't do Facebook Lives. I didn't have access to any of those things when I started out growing my business. But when I had some cash to grow an ad, I did, I added new providers. And that's when I started marketing. That's when I began to double down because I needed not to just fill my patient load. But I needed to fill the patient load of multiple other providers. And in order to do that, I either needed to get them out in front of people, or I needed to be able to find a way to attract clients to them. Now just have faith in yourself, that you can take good care of people, and they will return to your practice, they will spread the word of mouth about the care that you personally have given them, or given a friend or a family member, and that will allow your business to grow.
The third key to my success is to know your numbers. Now, I've mentioned this so many times in podcast episodes, but it's critical. You have to know the financial health of your practice. Just like you check a blood pressure or temperature on every patient that walks through the door. If you're an internist, you listen to their heart tones. If you're a cardiologist, you listen to their heart. There are several key metrics that are important to your practice. It's so essential to get a handle on the practice numbers, so that you know exactly what is going on in your practice. Your numbers tells the health of your practice, just like the metrics we use to tell the health of our patients. And I've heard so many providers who have people paying their bills and taking their money to the bank, and they don't realize they're actually being stolen from. I've heard of providers that have had people pay their taxes, and years go by and they find out that they owe five or six years of back taxes, five to six figures of back taxes. Don't farm out paying your bills or taking your money to the bank. So if you're just starting out that's the perfect time to really dive deep and figure out what's exact be going on, and learn from the ground up. Now I know this sounds tedious and it sounds like you're never going to have time to see patients. But trust me, I see patients four days a week, eight hours a day, and I still have time to run the business. And I still have time to pay the bills and do my numbers. And I keep track of my numbers every single week, every single month, every single quarter. When I first purchased my very first practice from my retiring mentor, he got embezzled over $50,000. Some of that wasn't even traceable. We don't know exactly how much she had stolen over the five years that she was working for us. I found it by accident. Because I was digging into the practice numbers. I wanted to see what we had going on. I couldn't understand how we were billing a million and a half a year between the three of us. And there was only 68 cents in the checkbook at the end of each month. And to pay the bills, we had to go ask our biller for money. And instantly she would come up with $30,000 or $15,000, whatever we needed that month to pay the bills. And I became very suspicious. It took me over a year and a half to prove that she was embezzling. Embezzlement happens all the time in small practices. He got embezzled, simply because he wasn't interested in managing the books. He wasn't interested in asking the hard questions from the accountant. The accountant knew there was a problem. And when I questioned him, the answer I got was he had brought it up to the providers many times they didn't want to talk about it. I tried to bring it up many times, they didn't want to talk about it. He is a wonderful doctor, and he is still my dearest friend 18 years later. But there was a lot of loss there. Don't let this happen to you. It doesn't have to be that way. I still talk to him, and I love him.
These are the key things that you need to get started in creating your practice. So deep dive into all of these topics, check out our podcasts as we go on about each one of these topics individually. If you want to know about a different topic, just share it, send us a message on Facebook or in YouTube or Instagram. Follow me on LinkedIn and I'm happy to produce different content that you need information on. Now again, it doesn't matter if you're a nurse practitioner, if you're a PA, if you're a DO, if you're an MD, If you're a chiropractor if you're a naturopath, starting your own independent practice can happen. It is not as hard as you think it is. It just takes some time to learn. And I would love to hold your hand along the way. So check out my accelerator business program at functionalmbi.com. And let's chat about your dreams of creating your business today.
Thanks for listening. If you enjoyed this episode, and you'd like to help support the podcast, please share it with others. post about it on social media, or leave a rating and review. To catch all the latest for me. You can follow me on Facebook at FMBI, join our free group where we support one another and share our struggles. Thanks again and I'll see you next time.