Notes from a Newbie: Nuts ‘n’ Bolts of Getting Your Practice Going
— Debbie Klingender
When last we left our heroine (aka, yours truly, neophyte clinical psychologist), she was fretting daily over finances, having achieved the coup of finding super office space and negotiating a (gulp) three-year lease. The great fear was: What if I open my practice and no one comes?
I’m very pleased to report that after being in independent practice for a little more than a month, cash is flowing in a positive direction. And that’s without being on insurance panels. Yep, I took a very deep breath and decided to go the direct-pay route.
I can hear you wondering, How can you do that, especially when you’re just starting out? Are you nuts? Glad you asked! Although my inclination has always been to avoid managed care, I did think long and carefully about whether I could build a sufficient referral network and, ultimately, a good enough reputation in the community to develop a financially sound business. In my rural area, the challenges of refusing to accept insurance are perhaps even greater than in an urban setting, where there’s a larger pool of people who are able to pay out of pocket.
In my first article, which appeared in the Summer 2006 issue of the IP, I listed some books and a DVD workshop that were very helpful with regard to building a fee-for-service practice. Do read them if you’re considering being managed care-free. I also queried friends, acquaintances, physicians, and others in the community and received solid support (at least in theory) for my venture. Therefore, with the caveat that it would take time to establish myself and develop my business – first to break even, then to pay off start-up debt, and finally to enjoy a profit – I jumped in with both feet.
So how did you decide how much to charge, and what do you do if people can’t afford your fee? Wow, more good questions. I did what everyone recommends: survey the competition. I spoke with other mental health care professionals and (after establishing rapport, of course) simply asked directly about their fees. Then I thought about what I figured was fair and settled on a fee at the high end of the range I’d discovered. As our esteemed Division 42 president might observe (were she as crass as I, which I’m sure she’s not), that took some cojones! It’s a gamble, of course, but so far no one has blanched.
Although I certainly want and need to make money, and while having a higher-end fee allows me to do so with a smaller caseload, I also want to be accessible to people who truly cannot afford my usual fee. So the logical solution was to offer a sliding scale – but how to implement it? I serendipitously stumbled across what I thought was a rather wonderful approach by Dr. Rich Shulman, who presides over a very cool organization in West Hartford, CT, called Volunteers in Psychotherapy (www.ctvip.org). (Eds. Note – The IP printed a summary article on VIP in our Spring ’05 Issue, which is still available on the Div 42 Website). VIP is a group of practitioners who have agreed to accept a lower-than-usual fee from self-pay clients, some of whom pay even less than the regular amount because they do volunteer work in the community in exchange for therapy.
After talking by phone with Rich, I developed a variation of his approach to set up my own sliding scale. I do not offer free therapy, by the way. Having worked in settings in which many patients paid nothing, I’ve come to believe that it’s important to charge something, in order to convey that my services have value. You can check out the particulars on my website (www.wellspringpsych.com), where I list my regular fee, payment policies, and information about reduced fees in exchange for community service.
“Having worked in settings where patients paid nothing, I’ve come to believe it is important to charge something”
Okay, so the big issues were settled for me. The next step was to get ready to actually begin seeing patients. Given my experience simply following the procedures and expectations of employers in the past, I’d not really had to think much about how to run a practice on a day to day basis. (Hint: it’s not as easy as you might expect.) Lo and behold, just when I needed him, along came Ed Zuckerman and his must-have book, The Paper Office, Third Edition. Honestly, I think I’d fall to my knees and kiss Ed’s feet if I ever were to meet him in person!
I’d seen many references to this volume for its wealth of forms and documents, but until I got a copy and started reading, I hadn’t realized it is a virtual bible for anyone who is either launching an independent practice or updating and revamping an existing practice to align it with the legal and ethics-related status quo. Really, it’s that full of information.
Let me give you just one critical example. Not sure about how to choose a professional liability policy? Read Ed’s detailed, savvy advice. For me, one of the best pieces of information was that you can (and probably should) select a “claims made” policy, which covers you for – surprise – all claims made against you while the policy is in effect. In order to extend your coverage when you change insurers or leave practice, you can purchase a “tail.” One of the big advantages of this is that the premiums are very low in your early years and gradually increase – a tremendous help when you’re just starting out. I’ll leave it to you to read what Ed has to say about looking for discounts, specific features to seek, and questions to ask when you interview representatives from the various insurers.
The Paper Office also walks you through all kinds of ethical and practical considerations as you design the policies and procedures for your business. A substantial portion of the book is devoted to ways of reducing your malpractice risk – an excellent foundation on which to build your professional approach to practice. I can attest that there are a zillion details that will threaten to overwhelm you as you begin to think about even the basic act of documenting contacts and treatment (unless you choose, unwisely, to just “wing it” and scribble occasional notes on whatever scraps of paper are handy). Ed will help you tackle the challenge with his thorough and logically organized sections on such topics as how to ensure truly informed consent, how to keep adequate records, what materials to provide to patients, keeping track of expenses and billing, intake and assessment, treatment planning, confidentiality, and releasing records, to name but a few. The book includes a CD with pdf versions of forms for almost every eventuality, plus a subset of forms that you can alter and customize for your own circumstances. (My only mild complaint about The Paper Office is that not all forms can be altered.)
In terms of documentation, I downloaded a free trial version of QuicDoc (www.quicdoc.com) software, based on recommendations from many Div42 members. I found it to be comprehensive, sophisticated, relatively user-friendly, and easy to learn. Its patient scheduling and charting capabilities are impressive. For example, symptoms and DSM diagnostic codes are built in, and the treatment planning feature provides suggested (and customizable) goals, objectives, and interventions according to a given diagnosis. For me, however, QuicDoc seems geared more toward an institutional or group setting than to the needs of a solo practitioner who does not deal with third-party payment. As you might guess, such a full-featured program comes with a fairly hefty price tag, which put it beyond my reach. Ultimately I decided to develop my own spiffy fillable forms for progress notes and treatment planning, based in part on samples contained in The Paper Office, and to do my scheduling on my Palm desktop calendar.
Well, now that we’ve settled a number of practical issues, we need to examine a few other nuts and bolts. To distort a famous line from that cinematic classic The Graduate, I’ve got one word of advice for you: backup! I’ve chosen to maintain three versions of all records: an electronic one on my office computer, a duplicate on my home computer, and a paper file under lock and key (times four: outside door lock, coded mechanical “punch” lock on the door from vestibule to waiting room, another punch lock on my therapy office door, and a lock on the filing cabinet itself). The cyber files are all password-protected and probably should be encrypted as well, but I haven’t gotten to it yet. Please don’t chastise me, Harry Corsover!
There are numerous mechanisms for backing up electronic records, which have been reviewed in detail on the Div42 e-list and are available in the archives. What I decided to use is a nifty program called Logmein (“log me in” – www.logmein.com). For about $120 a year, I can access my home computer from work and my work computer from home using Logmein’s interface. The fee is half that amount if you only want to have one-way access. I can control the remote computer (e.g., open and read files, check my Palm desktop calendar, etc.) as if I were sitting in front of it, can copy files from one to the other, and can synchronize folders so that all selected files on both machines are always up to date. Of course, this means that I’m responsible for actually doing the synchs. But Logmein also offers a program called Logmein Backup, which will manually or automatically create encrypted backups of any files you specify from your source PC to a storage PC. And should your source PC go kaput, Logmein claims that you can recover your data using its “restore” function.
Another consideration for independent practitioners is whether to accept credit and debit card payments. I decided I would do so and signed up through TherapyMatch.com for this service. Division 42’s own Josh Rosenthal, president of TherapyMatch, has arranged with ChargeEasy to provide merchant accounts. The rates and fees for this service beat just about any others out there that I have seen. I must point out that the application process was somewhat cumbersome, because these types of merchant accounts are used mainly by people who are doing business online, not providing direct services like psychotherapy or psychological assessment. Thus, many of the questions on the form simply don’t apply to most of us, but you can grit your teeth, write a little note in the space provided to explain the nature of your business, and then a nice representative will call you to verify the information and you’ll be in!
I signed up for a “card-present” account, which means that I have a small card swiper connected to my computer and pay a very low fee per transaction, since swiping a patient’s credit card provides better verification of the card’s authenticity than would just entering an account number. Do your own investigation on rates and fees (check the Div42 list archives), being sure to include the information at www.therapymatch.com.
One last aspect of getting your business running is a bookkeeping method to keep tabs on all the moolah you’ll be earning (ha!). I’ve chosen to use QuickBooks Online Simple Start for that task (http://quickbooks.intuit.com). This allows up to three sources (say, me at my office, me at home, and my terrific husband/tax preparer – or a professional accountant, if you prefer) to input and access financial data, which is stored in a top-secret galaxy far, far away. If you decide to purchase QuickBooks, here’s a tip: from the www.apapractice.org website, sign in and navigate to the Apapractice.org Store, where you will see a link for QuickBooks. As an APA Practice member, you’ll get a discount on either the traditional QuickBooks software (if you’d rather not have your financial records floating in some virtual ledger in the sky) or the online version. Nice!
See you in the next installment, in which your humble servant will discuss the dreaded M-word in ways that, she hopes, may allay your fear and loathing.
Debbie Klingender finds her fledgling small-town practice a source of daily challenges and great joy. She eagerly awaits your questions, comments, and suggestions for future articles at drdeb@wellspringpsych.com.
