How to Start a Therapy Private Practice: 13 Things to Do Before Leaving Your Agency Job

Starting a private practice can be an exciting and challenging venture for any professional. It can also be daunting to leave the security of an established agency job where the policies, clients, and structures are already in place. If you’re ready to take the leap into a new career path, there are several important steps you need to take prior to leaving your current job. This article will provide some useful advice on what to do before transitioning from agency work to running a private practice.

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Know your why

For many budding therapist, starting your own private practice sounds like a dream come true– no bosses, make your own hours, pick your own clients. It can also be A LOT of work. Knowing you “why” behind starting your practice is going to be helpful to build and maintain motivation during the peaks and valleys of entrepreneurship.

Knowing your “why” also help you determine how you want your business to look. More specifically, what clients will you work with? What will your hours be? How much do you want to work? What do you want your work day to look like? This might seem like basic information, but knowing your business structure AND STICKING TO IT (the much harder part) will ultimately what helps maintain your mental health and reduce the risk of burnout. Knowing your limits and needs will allow you to present the best version of yourself to your clients. For more information on preventing burnout in private practice, read my post entitled: “I Thought I Could Handle It”: How Therapists Manage Their Own Mental Health.

Additionally, your “why” is particularly important when it comes to marketing because you will be able to position yourself in a way that attracts your ideal client. If you “why” for example is to help empower new moms during their post partum journey, then tapping into that mission will help you develop an authentic voice when marketing to your ideal client. This authenticity will build trust as it will hopefully display your competence and passion for working with this population. For ideas on how to use your authentic voice in marketing, reference my earlier post on relationship marketing.

Book Recommendations:

• The Dip (great on how to maintain motivation)
• Start with Why: How Great Leaders Inspire Everyone to Take Action 
• Find Your Why: A Practical Guide for Discovering Purpose for You and Your Team

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Identify the hours you wish to work and set firm boundaries

When setting up your private therapy practice, it is important to identify the hours during which you wish to work and set firm boundaries around those parameters. Establishing a certain amount of time for yourself will help you create an appropriate balance between your career, family life, and time for yourself. This way, you are able to focus on clients without having to feel overwhelmed or overworked.

First off, consider the times of day that would be most convenient for both yourself and potential clients. If possible, try to arrange your schedule so that it fits the needs of those who may be looking for services from you [Example: If you plan on working with teachers, then you will need to offer hours after 4pm]. Then determine how many hours per week you are available to see clients or take on additional tasks related to running a business such as marketing or bookkeeping.

I mention the firm boundaries because it is tempting to try to accommodate as many people as possible, especially with the new flexibility that telehealth has to offer. This kindness however, can quickly turn to resentment if done to excess. The last thing you want is to be stuck in “work mode” all day because you scheduled yourself a split schedule, and are now seeing clients at 9am, 10am, 1pm, 4pm, 5pm, and 8pm. It can be tempting to take any client that calls your office, especially when starting out, but trust me, if the schedule does not match up and you over extend yourself, long-term this will not end well for you or the client.

Do your market research

Before opening your doors, it is important to understand the local market before making any big decisions. The success of such a business depends heavily on the surrounding area, which means that conducting research is essential in order to craft an effective business plan.

Market research should be considered from two perspectives: understanding the needs of potential clients and also researching what services other therapists offer. Knowing what type of people are looking for therapy services in the area can help determine how best to target them through networking and marketing.

Additionally, familiarizing oneself with competitors’ offerings will ensure that the services provided by your practice remain competitively priced while still delivering quality results. Gathering data through surveys, live events and social media are other great ways to gain insights into clients needs so you can tailor your business accordingly.

Personal Anecdote: When I first opened my doors, I expected to work exclusively with concussion and mild TBI clients adjusting to life post injury. Though some did come across my path, I learned that the these populations tended to stay within the outpatient hospital system and did not often reach out for private practice outpatient therapy. I was not getting enough referrals to fill a caseload, and therefor knew I needed to expand my market. At that point I began transitioning populations, which ultimately was a blessing because I became reacquainted with other populations that I enjoyed working with.

When doing your market research, here are some questions to keep in mind:

• What services are in demand for the area? (Tip: Psychology Today, Google Analytics and SEO are a huge help in figuring this out)
• What is the average price for therapy services in the area?
• What hours are other offices open?
• Will you do in person, virtual, or both?
• Are you interested in a self pay or insurance biased practice? What are other local therapist doing?
• If renting an office, where is it located? Is there parking? Privacy? A waiting room? Handicap accessible? Someplace where you feel comfortable seeing clients alone at night?

Begin marketing your practice as soon as possible and have a idea of where you are going to get clients

For many, the most difficult part of beginning a practice is marketing it successfully. This is because Marketing 101 is nowhere to be found in any psychology/social work graduate school program. The importance of starting to market your therapy practice as soon as possible cannot be overstated; early marketing helps ensure that your business will become successful.

The first step in effective marketing is understanding who your target clients are and how you can reach them. With this knowledge, you have the foundation for developing a plan that will help bring more clients into your practice. Establishing goals and setting timelines to measure progress will help refine this plan so that you can easily track its success or failure.

Additionally, knowing where you hope to get clients from – such as referrals from other health professionals or through advertising campaigns – allows you to focus on these areas specifically when creating promotions and campaigns for your business. Some ideas as to where you can get referrals are:

• Psychology Today
• Facebook group referrals (look for local therapy groups and check out my 11 most influential Facebook groups here)
• Professional networking– LinkedIn and in person
• Local hospitals/agencies
• Other private practice owners in different specialties
• Alma (their community discussion groups and member portal are great for this)
• Search Engine Optimization (SEO)
• Paid Ads (Google, Facebook, Instagram, etc..)
• Blogging*
• YouTube*
• Podcasts*

*For more ideas on how to use blogging, YouTube and Podcasting for marketing purposes read: 3 Ways Therapeutic Entrepreneurs Can Power Up Their Business Using Relational Marketing

Pro Tip: Keep track of where your referrals are coming from. I keep an Excel spreadsheet that tracks when I receive a potential client call and where it came from so I have an idea of what referral sources are working for me.

To take insurance or not to take insurance? That is the BIG question.

Probably the most frequently asked question (by both clients and therapists) is “do you take insurance?” When starting your private practice you have the option to choose what payments you will accept: private insurance, government insurance (Medicare/Medicaid), out of network only, workers compensation, automobile insurance, teachers union, TBI Fund, ect.

While accepting insurance can make it easier for clients to access your services and build a large client base, it also comes with its own set of unique challenges. Working with insurance companies often requires additional paperwork and may limit the treatments that can be used in therapy sessions. There are billing companies such as Headway and Alma, that streamline this process significantly– leaving you to focus on the clinical work while they take care of the rest.

I personally use Alma for this reason, on top of the fact that they have been able to negotiate higher reimbursement rates then if I had gotten paneled on my own. If you are interested in signing up with Alma, please consider using my referral code. If interested in learning more about my experience, read my complete review here.

On the other hand, choosing private pay means you have more freedom when setting fees and providing services. It also allows you to stay independent from third-party payment plans while still building a successful practice. Since you are not receiving referrals directly form insurance carriers, private pay practices often require more marketing efforts as well as clear messaging about why clients should choose private pay over using their insurance benefits.

If planning on going into a self pay practice, I recommend reading The Art of Closing the Sale: The Key to Making More Money Faster in the World of Professional Selling to develop your sales script.

Have your emergency resource in place

When you are working for an agency often times there are systems already in place for what to do when you go on vacation, call out sick, or if a client is in crisis. When you are in private practice this becomes YOUR responsibility. You are now exclusively in charge of determining what those systems look like as well as notifying the client of what is expected of them. Some recommendations that have been helpful for me:

1. Have a clear plan for how you will communication with your client outside of session in case of emergencies (ie. weather, sickness, family emergency) as well as a way for the client to reach you if they need to cancel. The last thing you want is to send an email that they will never see, or have them text you on a non HIPAA secure line.
2. Keep a list of crisis information handy. National suicide numbers, local crisis center, plan for emergencies. If you are telehealth, remember to collect resources for where your client is located and be sure to have the number of the local police station in case of emergencies
3. Have a network of referrals to provide in the case of extended absences or if a client need a a higher level of care. I am sure to have at least one referral for all specialties such as substance use, eating disorders, IOP, family therapy, etc..

Know your finances

Knowing your financial goals and budgets can help you make informed decisions as you progress through your venture.

Your business budget should be realistic, yet ambitious enough to reflect the success you wish to achieve. Setting short-term goals will help break down your long-term objectives into achievable steps that can be achieved gradually over time. Additionally, having a clear understanding of the costs associated with running a therapy practice will allow you to plan for unforeseen expenses along the way.

Private Practice Expenses to Consider:

• Office location and parking
• Electronic Medical Record and/or systems for documentation
• Technology: computer, desk, mouse, ect.
• Marketing expenses
• Furniture (if in person)

For a complete list of my go to products and services, click here.

A thorough budget should focus on all areas from operational costs such as rent fees, equipment purchases, insurance premiums etc., to marketing expenses which may include website development or advertisement campaigns for example.

• What are your overhead expenses? (AKA: How much money you need to make each year to keep practicing running?)
• How much you need to earn each year (post expenses) to pay for the lifestyle you want?
• How many client’s do you need to see weekly to maintain your financial goals?
• Do you have a savings plan for slow weeks, vacation, sick days, ect?
• What is your loan repayment plan, if you need a loan.

Understand the legal requirements

Opening and running a private therapy practice requires more than just clinical training; it also requires an understanding of the legal requirements. In order for a practice to be successful, therapists must familiarize themselves with the relevant laws and regulations that pertain to their specific area. This includes obtaining necessary licenses and permits, abiding by healthcare regulations, having contracts and policies in place, staying up-to-date on tax information, and understanding HIPAA guidelines.

Failing to adhere to the applicable laws may lead to serious repercussions including hefty fines or even legal action against your business. This can be detrimental not only financially but also professionally as negative publicity can damage your reputation and ultimately harm your ability to attract clients. Additionally, it is important for therapists to understand their rights as employers so that they are able protect themselves when entering into employment agreements or engaging independent contractors.

Every state and municipality has its own regulations governing businesses. Plan to consult with a business lawyer so you can follow the laws in your area. Some important considerations include:

• How to obtain a business license (if needed)
• How best to incorporate your business as a separate entity.
• Malpractice and professional liability insurance.
• Tax requirements and collections (ie. do you charge sales tax? do you pay taxes quarterly? annually? both?)

Develop clear policies

When starting any business, it is important to have well-defined policies in place. For private therapy practices, this is especially true given the intensely personal nature of the work. Clear and concise policies ensure that clients feel safe and secure when entering into a therapeutic relationship with their therapist.

Creating effective policies for a private therapy practice not only protects both the client and practitioner, but also ensures that all parties are aware of each other’s expectations. Policies should cover topics such as confidentiality and privacy procedures, appointment scheduling protocols, agreements related to billing or insurance coverage, as well as any cancellation or rescheduling requirements. Additionally, having an easy-to-understand policy document readily available helps clients make an informed decision about whether or not to enter into a therapeutic arrangement with the practitioner.

Clear policies help you better manage your practice while ensuring clients know what to expect. Some considerations include:

• Will you accept cash, checks, credit cards, FSA, Venmo/Zelle/PayPal, Bitcoin, FSA, workers compensation insurance, motor vehicle insurance?
• What will you charge per session? Will you offer sliding scale or pro-bono work? If so what are the requirements?
• What is your appointment cancellation policy? Do you charge for no shows or late cancelations?
• What specific steps will you take to protect client privacy and comply with laws such as HIPAA?
• What will you do if a client is a danger to themselves or to others?
• Under what circumstances will you refer a client to another treatment provider?
• What is your client emergency plan when you are away or on vacation?

Need help with contract writing? Check out the Contract Club to help you come up with your wording for things like cancelation policies and website terms & agreements.

Set up peer supervision and/or consultation

Even once you have become a fully licensed therapist, it is important to continue supervision or at minimal peer supervision, just to be sure that your quality of care retains it standards. This is especially true if you are moving to solo practice after being used to working as a part of an agency team where peer consultation may have been built in to you daily system.

Even when picking your own clients, you will have difficult cases, or maybe even cases that you are unfamiliar with (we all know rarely is anything is ever as straightforward as it appears on the intake). Being ale to consult with others is a great ways to grow as well as make sure you are not missing something.

Pro Tip Be sure to include a statement in your new client contract informing the client that you receive consultation and supervision. Also be sure that no PHI is shared during these consultation sessions and if you do plan to share PHI, gain consent from the client directly prior to doing so.

Not sure where to find a supervisor or peer supervision group?

• NJ NASW Clinical Supervision Directory: Click Here
• Alma also offers informal peer consultation through their clinical discussion groups. Read more about it in my compete review.
• Ask around in therapist Facebook groups– word of mouth is a great referral source.
• Liked a presenter from a workshop you attended? Reach out to them directly and ask if they provide supervision.

Prepare and review all paperwork

Running a successful therapy practice requires that all paperwork be properly prepared and reviewed. This includes onboarding paperwork such as new client contact, HIPAA, telehealth consent, privacy policy, good faith estimates, informed consent and investment descriptions; as well as clinical paperwork like progress notes, treatment plans and treatment plan reviews. It is important to make sure all of these documents are complete and up-to-date in order to ensure your clients receive the best care possible.

Select and test run your EMR and telehealth platforms

When starting a therapy practice, one of the most important decisions you need to make is selecting the right electronic medical records (EMR) and telehealth platforms for your business. But with so many options out there, how do you decide which ones are best for your practice? The answer is simple: test them out before making any commitments.

Testing EMR and telehealth platforms can give you an idea of their features, as well as whether they meet your needs in terms of data security, patient management capabilities, and other essential elements. To ensure accuracy and reliability in the selection process, it’s important that you run a test run before investing in any software or services. This will help you evaluate the compatibility between different products and find those that provide seamless integration with existing systems. Some examples of available products and services are:

• SimplePractice (read my complete review here)
• Zoom (Alma offers free professional Zoom with their membership, read my compete review here)
• G-suite
• Psychology Today sessions

Pro Tip #1: Have 2 versions of telehealth platforms incase technology fails

Pro Tip #2: Test all your technology (ie. sending documents, patient messaging) be be sure everything works BEFORE you book your first client. You can do this by creating a fake client or asking a friend to do a mock onboarding with you.

Not sure which platform is best for you? Therapy Facebook groups are a great place to ask around and see what others are using.

You can also see a comprehensive list of the products and services I use in my clinical practice, here.

Secure office basics such as location for sessions, address, phone, email, ect.

The selection of an appropriate location for sessions is critical. It should provide a secure environment that allows patients to feel comfortable enough to discuss their issues openly and honestly. Privacy for both you and your patients must also be taken into consideration when choosing a space for conducting therapy sessions. Additionally, finding an accessible location with adequate parking can help make the process easier for potential clients looking to schedule appointments.

If you plan on running a virtual practice from home be sure that your WIFI is strong and that privacy measures are taken. Things like a locked office, sound proofing, white noise machines, noise canceling headphones, make all the difference when working form home.

Are you working from home but seeing clients in person? Some things to consider are:

• Is there a separate entrance that is private?
• Is the room you’re thinking of using situated close to both the bathroom and the entrance door? 
• Is there space where clients can park without inconveniencing family or neighbors?
• If you are seeing clients one after the other, is there somewhere that they can wait, in the event that you run over time? If not, you may need to allow more time between appointments to ensure there’s no overlap.
• Consider how having clients in the house is going to impact on family, children and pets.

Summary

In conclusion, starting a private practice is a daunting task but an exciting adventure. It requires time and commitment, and the right mindset to ensure success. Taking the time to carefully plan ahead can help make this transition smoother, and help you hit the ground running when it’s time to start your practice. Consider creating a timeline of all the things you need to do before leaving your current job, as well as setting up systems for managing appointments, bills, and finances. Some questions to consider: Why do you want to go into private practice? What do you want your schedule and client list to look like? What resources are at your disposal? What technology will you use?

Regardless of why, how or when you build your practice, remember it is YOUR practice. Take consult from others but do what feels best for you. If you feel good about your services, you are much more likely to provide good work to those you serve.

Attention: Live Masterclass & Group Coaching April 18,2024

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