Many therapists assume they will one day build a private practice, but have they made all the considerations?
We'll Cover:
Private practice. The promised land for therapists and inevitable resting place for a career in therapy. Many say that they will “end up” in private practice. We all know the positives: you are your own boss, you can make more money, set your own schedule, etc.
Yet there are plenty of tradeoffs to consider in such a life. Let's take a look at the other side of the coin...
What is Private Practice?
First of all, what does “going into private practice” mean?
By "private practice" we mean a therapist who owns their own practice. Many say private practice in reference to their contractual position alongside other therapists at a group practice. This is not considered private practice. Although you practice therapy with greater independence at a group practice, you have none of the headache of running a business.
Private Practice is a Business
Do not forget, private practice means you are running a business! And if you aren't interested in handling business tasks such as marketing, accounting, networking, extra tax filing, liability and legal policies, then you may want to reconsider. It's common for those without an entrepreneurial bone in their body to plan on private practice.
We will explore these considerations in greater detail, but for now let's reframe the question as - do you want to go into the business of private practice?
Let’s take a look at some things to consider to help you decide if this is right for you.
It’s A Lot Of Work
At least let's say, it's a lot of work to do it right. Like any industry, private practice has its share of poor business owners. As a solo owner, you have direct control on how you build and manage your business. You can be lazy and take shortcuts, this is common. Yet if you're determine to have a healthy business, there are many decisions to explore.
Will you have a business bank account? If yes, how will you determine which bank to work with? What is your marketing plan? If you're doing online work, will you have cyber insurance? Will you incorporate your business, and how will you file your taxes?
These questions often don't have right or wrong answers, there's no cookie cutter formula. The hard work exists not in the tasks themselves, but how you weave them all together into the framework of your business. This takes time and requires patience and focus.
So as business owner you also become a student of business. There are specialized coaches that can help you build your business, this may be a consideration for those overwhelmed by these decisions. There are also educational courses for sale, but remember the best business for your life is the one built around your personal design.
The Hidden Extra Costs No One Talks About
As a business owner, you get none of the perks of being an employee. You have to pay for your own health insurance, and you are responsible for all your business taxes. Yes you can deduct expenses, but it takes more work to create a system for tracking your business expenses.
Another common cost, rarely talked about, comes from working with a poor accountant and paying too much in taxes. On the other hand a good accountant will typically cost more, but save you in the long run.
And then the little costs... Will you use a credentialing and billing company? How about an attorney for your legal and liability? Your EHR system? Office rent? You'll also probably want a CPA to help with retirement planning, and perhaps a financial managers to more efficiently manage your personal and business wealth and assets.
And remember as there are no benefits, there’s also no paid time off. So every time you take a day off or vacation, you're giving up money. Once you stop working, the business stops making money. It can be psychologically challenging for therapists to see their money suddenly shut off like this.
Self-Accountability and Getting Stuck
You are your own boss. So who will hold you accountable for getting those notes in within 24 hours of sessions? What will your measure be for whether or not you are doing a good job?
As business owner, there is no one telling you what to do, or how to do it. You make all the decisions yourself. For many, this is overwhelming. For others, they get lazy. When you are working alone, it becomes much easier to fall into bad habits.
Keep in mind too that this can impact your clients. If you're having a hard time building your caseload, your financial concerns might impact how you meet with clients. It's not uncommon for therapists to drag out therapy, or take clients outside their expertise, because they need the money.
Those in private practice should join a therapist consultation group to ensure that you are continuing to grow as both a clinician. A business consultation group can also be helpful for making sure your business pressures aren't impacting your clinical work.
Dealing With Competition In an Uncertain Future
There is now serious concern about venture capital funded companies such as BetterHelp and TalkSpace dominating the therapy market. We've never seen so much corporate money being pumped into psychotherapy before. This is concerning for both small group practices and private practices.
How are you going to compete with these giant companies who dominate advertising and offer services at much cheaper costs? Of course, it can be done. But to be a thriving private practice owner today is more and more starting to look like an entrepreneurial endeavor. Is this something you are willing to sign up for?
It’s a Lonely Life
Keep in mind, you are sole owner and employee, a team consisting of one. Socially, this is isolating. Yes you’re with your clients, but that doesn't count. There’s no “water-cooler” conversation, no teamwork or shared sense of mission and purpose. The changing seasons of life's difficult times and celebrations come and go, in isolation.
If you don't enjoy the people you currently work with, this may not seem a big deal. And it may not be, but remember you're considering an entire career of working alone. And if you do online therapy at home, you may feel this sting even more and find yourself craving more human connection. In my personal opinion, this is the biggest drawback.
There's a special fulfillment of being on a team that working alone just cannot replace. After all, we are social beings wired for connection and working in groups.
Should You Go Into Private Practice?
Ok, this article isn't intended to deter future business owners, but only to present the reality on the other side. Private practice gets championed often, and for many it makes a good business. But like everything in life, if it sounds too good to be true, it is. There are always tradeoffs.
Successful business owners become familiar with having to analyze the pros and cons of all decisions. So, if after reading this you are having some ideas and thinking "bring it on," then private practice is probably a good move for you. If this article raised more questions, then I encourage you to seek out more answers.
If being a business owner is starting to feel overwhelming, consider finding alternative ways to have a thriving career as a therapist. There are many innovative group practices that offer unique benefits while providing rewarding and engaging experiences for their therapists. I know many personally that promote growth and autonomy in your career while also being part of a fulfilling team experience. After all, we truly are much stronger when working together.
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