When considering starting a medical practice it can be difficult to determine where to begin. Owning a solo business entity comes with any number of unknowns. Partnering with an experienced business consultant, specifically one familiar with business operations, healthcare requirements, and the complexities of NP private practice ownership, can help navigate these unknowns.
Whatever it is that you hope to achieve with your entrepreneurial endeavors, taking that first step is often the hardest. We’ve developed this list of 10 first steps to guide you in how to start your own medical practice.
How To Start a Medical Practice Checklist
While every nurse practitioner business owner’s long-term 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 determine 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 that suit your needs.
Step 1: Identify Your Unique Value Proposition
While starting a medical practice may be a goal for many NPs, your desire, passion, and skillset are 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? Expressing all these differentiators will help you attract patients looking for a provider like you.
Switching providers and dealing with insurance companies 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 can rely on you for consistent quality in patient care.
Your unique value proposition is the foundation of your nurse practitioner owned business. It can be difficult to articulate 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.
Step 2: Consider Care Delivery Plans
With your unique value proposition in hand, it is time to consider what care delivery plans to offer. 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 type of business you’ll offer to your patients will be primarily centered around your specialty (e.g., primary care), 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. Adding additional services can help you stay competitive by responding to market demand.
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 real estate, 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 be an accessible and affordable solution for patients. While securing payer contracts can be time-consuming and challenging, it ultimately means you can care for more patients in your community. You may also consider concierge care models, which typically have annual fees paid by the patient, or cash paid services, both convenient for patients who don’t have insurance.
Step 3: Build Out a Five-Year Plan
Equally important to getting your own medical practice off to a good start is planning out how to sustain and grow your NP-led practice. With a commitment as significant as pursuing practice ownership, looking into your future by setting realistic goals for personal and practice growth helps guide your steps toward success. Creating a five-year plan can help you confirm that 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 and office space
- The hiring of additional staff/providers
- Your expected cash flow, business loans, revenue, and earnings
Conducting market research while building out your five-year plan will help set goals and expectations within realistic parameters. Remember, this is simply a plan, and plans often change, and you may see results sooner or later than you anticipated. And remember that adapting to change is crucial to powering through challenges that come your way.
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 so you can avoid running into surprises.
If you find that your state requires a collaborating physician, don’t worry. You can contact a physician colleague or an organization like Collaborating Docs to help establish this relationship. In many instances, the time you’ve spent in employed positions may free you of certain restrictions.
Step 5: Review and/or Acquire State Licenses
Certification is one of many steps in the process of getting clearance 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 maintain medical malpractice insurance, 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. 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.
Your account includes records of 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.
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 the credentialing process 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, note your ideas and learnings. Whether you create a formalized business plan or keep it as more of a work in progress, this business plan will provide the framework to guide your success and turn your vision into reality. In our NP business plan blog, we outline the eight critical components of a nurse practitioner business plan:
- Executive Summary – Demonstrates your passion and vision in one concise section.
- Company Overview – Describes the nurse-owned practice you intend to launch.
- Products and Services – Details of the services you intend to offer, how much they cost, and what you expect to earn for each service.
- Market Analysis – Identifies the key patient segments you wish to care for and explains how your offerings are expected to compete with similar providers.
- Strategy and Implementation – More granular, this section explains services and delivery strategy and explains why you believe this is the best route.
- Marketing Strategy – Consistent public outreach is instrumental in establishing and growing your patient panel, so a strong strategy is necessary to make your presence known.
- Organization and Management – In your prospectus, introduce yourself and any other colleagues or partners who will be involved in your practice.
- Financials – This section will outline your projections for incurred or expected cost and revenue, demonstrating that your practice can and will be profitable.
What’s Next After Starting Your Own Medical Practice?
With a greater understanding of how to start your own medical practice and draw up a roadmap of early steps, you are equipped for your journey towards independence. As you work through the 10 steps outlined above, you may begin to consider vendors and partners who can help you work through challenges that you don’t think you should do alone. For example, you may opt to outsource or gain assistance from outside parties to navigate things like credentialing, practice marketing, workers compensation insurance, billing and more.
NP Advantage Can Help
As you complete these initial 10 steps, the NP Advantage team is prepared 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.