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14 Essential Questions Therapists Need to Consider Before Opening a Group Practice

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At some point, most successful private practice therapists will either ask themselves, “Should I start a group practice?” or another associate or therapist will ask them if they’re hiring.

Group practices can be appealing for many reasons. You can scale your business, earn more income, help more clients, and mentor other clinicians. But there are equally-important downsides to consider, such as operating costs, managing others, and being responsible for more things going wrong.

If you’re debating expanding your current practice into a group practice, it’s important to ask yourself these essential questions.

Why Should I Start a Group Practice?

No therapist should just open a group practice arbitrarily or haphazardly. Expanding your business requires a significant investment in your time, energy, and financial resources. There can be a lot at stake, and you really need to reflect on your intentions before you make a move. 

Start by considering what’s compelling you right now to make this business choice. What are you hoping to achieve? And what will you tell yourself to stay motivated even when things become undoubtedly challenging? Even if you don’t have exact answers, it’s important to be aware of your main values at this time.

How Will I Hire Therapists for My Group Practice?

Not only do you need clients for your group therapy practice, but you also need strategies in place for hiring the right therapists. New owners are often surprised by how difficult it can be to source, onboard, and hold onto their clinical team.

You have to consider that your more successful therapists might move onto their own solo practice. This is one of the "costs" of doing business, but it can be challenging and, at times, disheartening.

At the same time, while therapists may be used to setting boundaries with their clients, they may feel uncomfortable doing so with their therapists. But you will likely encounter staff who fail to perform or complete certain expectations in a timely or appropriate manner. Knowing how to manage these problems requires skill, and it can take time to build that skill.

Moreover, you want to maintain a good reputation within the community. Therapists should want to work with you. A poor image, even if it's unfounded, can significantly impact your hiring process.

Do I Like Managing People?

It's important to remember that great therapists don't always make for great managers or business leaders. In fact, this is an area where many mental health professionals struggle.

A group practice owner, however, needs to prioritize strong communication, boundaries, and onboarding practices. This makes your work much different than a solo private practice. At any given moment, you might be training staff or outlining consequences if they don't follow through with certain tasks, such as completing paperwork on time.

If you enjoy this kind of leadership, scaling your solo practice into a group one can be highly rewarding. But if this is intimidating or uncomfortable to you, you might find it difficult to adjust to this business model.

What’s My Business Plan?

Even though they may seem like an old-fashioned concept, business plans are essential for organizing ideas and launching a new company. A successful group practice has a clear executive summary, company description, market analysis, and information and marketing and sales.

Your business plan will likely evolve, but you should really consider making a comprehensive one before taking the leap in expanding your own practice. Having a solid plan will help you with everything from staying on track to hiring new staff to advertising your practice.

Will My Group Practice Accept Insurance?

How you accept payment is a significant part of shaping your group practice. Many group practice owners opt to accept insurance, but that requires managing insurance and client billing. It may also mean less profit for both you and your therapists, which can lead to financial problems.

However, not taking insurance has its own considerations. Where insurance often acts as a steady source of referrals, a self-pay, cash-only group private practice needs to have solid and consistent marketing. People in the community need to know your presence,

How Will My Therapists Be Classified?

Each state has its own laws about classifying therapists. You need to be aware of what your state's requirements are in assigning independent contractors from employees.

A 1099 contractor (or independent contractor) has their own business. You are limited in how you schedule them or which tasks you require them to do. Contracted providers typically cost more per hour, although they generally cost the business less over the course of a month or year (because you don't provide them with benefits).

Employee providers typically adhere to a specific schedule and salary or hourly rate. You are also responsible for providing them with workplace benefits and health insurance. The employment system you use can also affect your EHR structure, as employees will typically work under your group practice, whereas contractors will often have their own accounts.

Am I Looking To Make Passive Income With a Group Practice?

One of the biggest misconceptions of a group practice is that the owner is simply receiving passive income. In most cases, this is far from the truth.

At first, you'll probably be working more hours than you ever did in your own private practice. You'll be recruiting new therapists, refining your onboarding process, and advertising to potential clients. You may also be the one fielding intake calls and other administrative duties.

Moreover, unless you hire an office manager, you're probably the one on the hook for managing both therapist and client issues as they arise after hours. That's not to say you still shouldn't pursue this path. But it's paramount to be realistic with the potential workload.

How Will I Cope if Things Get Messy?

Are you someone who goes with the flow and enjoys learning as you go? Or do you struggle with anxiety, micromanaging tendencies, and a heightened need for control? If a therapist quits your group practice without any advance notice, how will you cope? If you stop getting new client inquiries, how do you imagine you might respond?

There is, of course, no perfect way to imagine what could happen. But stress is an inevitable part of all successful group practices, and all businesses have a chance of failing. It's important that you know yourself and your limitations honestly.

How Do I Plan to Automate and Delegate?

In your own private therapy practice, you might manage most of your daily tasks. But when you operate a group practice, the stakes are much higher. You're only one person, and it's easy to get overwhelmed or fall into a trap of trying to do everything, even if you aren't doing those things well.

From the beginning, starting a group practice means perceiving yourself as a leader. You're going to be managing multiple therapists and coordinating numerous therapy sessions with both old and new clients. If you intend to continue scaling, this requires even more moving parts.

How Well Do I Understand My Current Competition?

In the beginning stages of starting a new group practice, it's important to be aware of the other competing therapy practices. That's not to say competition is a bad thing. There's a tremendous need for high-quality mental health services, and no one company or therapist can serve everyone.

But it's imperative that you consider that many mental health professionals will be vying for the same clients you want. What will make your group practice different? How will you market in a way that best attracts potential clients? In addition, how can you ensure that you provide an attractive work environment for therapists seeking to work for you?

Am I Willing to Reduce My Own Clinical Work?

In your own solo private practice, you probably spend the bulk of your day having therapy sessions with your clients. But owning a group counseling practice is different, and some owners are surprised to find that they spend most of their working time focused on business management instead of client interactions.

If you truly love your work as a therapist, you may want to reconsider what having your own group practice means. If you don't reduce your caseload, you'll be working more hours than you likely are right now. After all, owning a business means wearing many different hats, and you'll need to be as business-savvy as you are clinically-savvy.

Am I Willing to Take On More Administrative Costs?

It's easy to get caught up in all the financial benefits associated with operating your dream practice. It's true that you may make significantly more income in running a group practice than when it's just your own business.

But earnings only tell one part of the story. When it's your own private practice, you can generally measure profits by evaluating how many clients you see each week or month. You simply compare this to your individual operating costs or the insurance company reimbursements.

On the business side of a group practice, you will be absorbing all the expenses associated with this larger business. There are certainly ways to save money, but you may be spending more on everything from listings on online directories to paid ads on search engines to more office space to professional development courses to legal entity fees.

It's essential that you consider your own monetary comfort in this process. Solo practices have inherent financial risks, but these risks tend to grow exponentially once you have other clinicians working under you.

Do I Plan to Work Out of the Same Office?

On a logistical level, geography certainly plays a role within a therapy practice. If you already see established clients in one location, there is the risk of losing them with relocation. However, your current office setup may not be large enough for multiple therapists.

It's not uncommon for many group practices to now balance both in-person and hybrid therapy offerings. Likewise, since COVID-19, many therapists only offer remote services with no in-person sessions available.

Do I Have Mentorship?

Most successful leaders have one thing in common: they constantly seek mentorship. They recognize their needs and limitations, and they seek out information from people more experienced than them.

Many therapists, however, lack this clear mentorship. Instead, they strive to forge their own paths and sometimes become stubborn with their own tenacity.

Quality mentorship can help with everything from landing more opportunities for networking, identifying blindspots, building company culture, and troubleshooting ongoing issues.

How Navix Health Helps Group Practice Owners

The clinical work of running a group practice can be taxing. While you're busy managing your mental health professionals and clients, it's important to have an effective EMR system that you can rely on.

Navix Health offers all-in-one comprehensive solutions for everything you need to successfully operate your group practice, from scheduling to insurance and client billing to streamlining payments. We also offer extensive documentation, policies, and procedures. 

Sign up for your free trial or custom demo today.

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