Medical practice lobby with patients

How to Start Your Own Medical Practice: 10 First Steps

When considering how to open a medical private practice it can be difficult to determine where to start. Owning your own practice comes with any number of unknowns. Partnering with an experienced business consultant, specifically, one that is familiar with business operations, healthcare requirements, and the complexities of NP private practice ownership, can help to navigate these unknowns. 

NP entrepreneurship requires a great deal of time, passion, and patience – but the outcome of owning your own practice is more than worth the investment. The benefits of independent practice for NPs are many and often vary, but some of the key impacts NP business owners have shared are freedom and flexibility, finding new joy in work, and achieving better patient outcomes.  

Whatever it is that you hope to achieve with your entrepreneurial endeavors, taking that first step is often that hardest. We’ve developed this list of 10 first steps to guide you in how to start your own medical practice.  

10 First Steps for NP Entrepreneurs 

While every nurse practitioner business owner’s goals and journey to independence varies, we have found that the following activities have been helpful in propelling the success of NPs we’ve worked with. They also can help guide you as you figure out how to open your private practice. Due to the variability in state regulations, healthcare laws, and practice goals, this list is meant only to serve as a guide and is not intended to be all-inclusive. As you navigate these steps, or encounter barriers in your entrepreneurial journey, our team is happy to help or guide you to additional business resources. 

Step 1: Identify Your Unique Value Proposition  

While owning your own practice may be a goal for many NPs, your desire, passion, and skillset is unique. What is it that makes your NP business ideas different? What is it that makes you different? How will your care model drive better patient outcomes? Why would a patient want to come to your nurse practitioner run clinic? What experiences have you had that drive your desire to transition from nurse to nurse entrepreneur? 

Switching providers is often seen as a hassle by patients. That makes it critical that you identify and effectively communicate what it is that makes you unique, why those characteristics are impactful, and how they will improve patient care.  

Your unique value proposition is the foundation of your nurse practitioner owned business. It can be difficult to identify what it is that makes you and your practice ownership goals unique, so consider asking a family member, friend, or colleague to discuss these topics and help you articulate your unique value proposition.  

Examples of Unique Value Propositions: 

Apple iPhones: A superb user experience backed by years of credibility and enhanced by leading security technology. 

Uber: A quick, convenient, and cash-less mode of transportation that gets you where you need to go, no matter where you are.  

NP Advantage: The culmination of years of healthcare and business experience, with an eye towards the future of patient and provider needs.  

Step 2: Consider Care Delivery Plans 

With your unique value proposition in hand, it is time to consider your care delivery plans. Keep in mind that your delivery plans should be effective in meeting the needs of your prospective patient panel, as well as your personal needs.  

A few care delivery considerations are: 

What Services Will You Offer? 

The selection of services you’ll offer to your patients will be primarily centered around your specialty, your training, and the needs of your patients. However, are there additional services you’d like to add to your practice? For example, IV hydration, hormone replacement, and holistic medicine offerings are often additional services NPs provide at their practice. 

How Will You Deliver Care? 

Entrepreneurial nurse practitioners often seek innovative care delivery models to address gaps that they’ve identified in their current care settings. Care delivery can be accomplished in traditional brick-and-mortar settings, through telehealth offerings, home-visits, mobile clinics and more. Often, it is best to implement a combination of delivery strategies so that you can effectively serve more patients.  

What Will Your Payment Options Be? 

Accepting both insurance and cash pay is the best way to make yourself an accessible and affordable solution for patients. While securing payer contracts can be time-consuming and challenging, it ultimately makes your services available to more patients. You may also consider concierge care models, which typically have annual fees paid by the patient, or cash paid services that increase access to healthcare for patients who don’t have insurance.  

Step 3: Build Out a Five-Year Plan 

Equally important to determining how to start your own medical practice is planning out how to sustain and grow your NP-led practice. With a commitment as significant as pursuing practice ownership, you should be able to look into your own future by setting realistic goals for personal and practice growth. Creating a five-year plan can help you determine if practice ownership is the right next step in your career. Does entrepreneurship align with your personal five-year plan? 

Some things you may want to consider adding to your five-year plan are: 

  • If you’ll be part-time or full-time. If part-time, will you transition to full-time? When? 
  • The size of your patient panel 
  • Geographic expansion (cities, states, etc.) 
  • The addition of new services 
  • The hiring of additional staff/providers 
  • Your expected cost, revenue, and earnings 

Conducting market research while building out your five-year plan will help with decision making and realistic goal setting. Remember, this is simply a plan, and plans often change. It isn’t unrealistic for you to see results sooner or later than you anticipated. The ability to adapt to change can make or break a practice’s success. Consider the COVID-19 pandemic; practices that quickly implemented telehealth offerings were able to maintain continuity of care, while later adopters saw negative impacts on patient and practice performance – so setting plans and being flexible and agile in adapting them to meet market needs is key to your success.  

Step 4: Review State-Level Scope of-Practice Regulations (SSoPRs) 

It is important to understand the level of authority granted by your state’s scope of practice and that of any other states you wish to serve. Full scope states often have fewer barriers to market entry, but practice ownership is still an option for those in reduced or restricted states as well. The regulatory environment varies by state and may be complex, so reviewing with legal consultants or experienced colleagues is recommended. If you find that your state requires a collaborating physician, contact a physician colleague or an organization like Collaborating Docs to help facilitate the relationship. In many instances, the time you’ve spent in employed positions may free you of certain restrictions.  to help facilitate the relationship. In many instances, the time you’ve spent in employed positions may free you of certain restrictions.  

The AANP has created this interactive map to help NPs navigate state-level authority.  

Step 5: Review and/or Acquire State Licenses 

Certification is one of many steps in the process of getting licensed to practice and credentialed in your state. NPs sit for the certification examination that aligns with their graduate education, role, and population focus.  

Licensing is done on a state-by-state basis; thus, the requirements vary by state. Generally, the minimum requirements for a new NP license include an active RN license in the state you wish to practice, certification from a nationally recognized certification board, and proof of graduation from an advanced nursing education program. If you plan to practice in multiple states, you will need to ensure you have the proper licensure for each of those states.   

Additionally, you must renew your certification every few years as well as maintain your nursing license through the state licensing board.   

Step 6: Update CAQH Account 

Ensure that you can access your Council for Affordable Quality Healthcare (CAQH) account and that all documents within it are up to date. This includes having up-to-date licenses, certifications, education and attestations within the database. Often, in employed settings, management of the CAQH account is handled at the organizational level by practice managers or other administrative teams. If you aren’t sure how to access your account, begin by identifying who has been managing it on your behalf, then discuss proper steps to ensure you have access.  

Step 7: Acquire Tax ID Number 

A Tax ID Number is required to hire employees, pay taxes, open business banking accounts, and secure a Group NPI. Per the IRS, completion of an online Tax ID application can yield a Federal Tax ID Number within an hour. You can apply at the IRS site here, which provides easy-to-follow instructions for the process.  

Step 8: Acquire Group NPI 

As a provider, you likely already have your own NPI (National Provider Identifier). In addition to your personal NPI (Type 1), you will need to generate a Group NPI (Type 2). This Group NPI sets your practice up for long-term growth and enables you to begin credentialing with commercial and federal payers. You can complete the online Group NPI application here. Per CMS, it may take up to 15 business days to process your application.   

Step 9: Acquire CLIA Waiver 

By submitting a CLIA (Clinical Laboratory Improvement Amendments) application, you enable your practice to enhance patient care and create additional billable opportunities. CLIA waived tests are simple point-of-care tests with one- or two-step processes like urine pregnancy tests, rapid strep test, and glucometers, and do not require special training to perform. State agencies process applications and renewals, so you may need to check with them if you plan to work across state lines.  

Step 10: Develop Your Business Plan 

As you work through these steps, document your ideas and the decisions you’ve made. Whether you create a formalized business plan or keep it as more of an informal planning document, this business plan will be helpful in guiding your success and turning your vision into reality. In our NP business plan blog, we outline the eight critical components of a nurse practitioner business plan:   

  • Executive Summary: An opportunity to demonstrate your passion and vision in one concise section. 
  • Company Overview: A more in-depth description of the nurse-owned practice you intend to launch. 
  • Products and Services: A clear description of the services you intend to offer, how much they cost, and what you expect to earn for each service. 
  • Market Analysis: Identify key patient segments you wish to care for and explain how your offerings will compete with similar providers. 
  • Strategy and Implementation: More granular, this section provides a detailed explanation of services and delivery strategy, with an explanation of why you believe this is the best route. 
  • Marketing Strategy: Marketing is key to establishing and growing a patient panel, so you’ll need a strong strategy to make your presence known. 
  • Organization and Management: Introduce yourself and any other colleagues or partners who will be involved in your practice.  
  • Financials: This section will outline your incurred or expected cost and revenue, demonstrating that your practice can and will be profitable.  

What’s Next After Learning How To Start Your Own Medical Practice?

With a greater understanding of how to start your own medical practice and a roadmap of early steps, you are equipped to continue on your journey towards independence. As you work through the 10 steps outlined above, begin to consider vendors and partners who you may need to work with. You’ll likely want to outsource or gain assistance from outside parties to navigate things like credentialing, practice marketing, billing and more.  

NP Advantage Can Help 

As you complete these initial 10 steps, the NP Advantage team is available to be by your side on your journey to independence. Our team of experienced business and healthcare consultants have the skillset needed to support the launch and growth of independent NP practices. Our team gets your practice up and running, then provides ongoing support so that you can enjoy the benefits of nurse entrepreneurship, without the challenges of navigating this endeavor alone.  

Let’s Improve Patient Care Together