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The Economics of Owning a Medical Practice

Owning your own medical practice is quite the big undertaking. While the freedom to make decisions about the care, treatment, and the way things are run in your own practice is liberating, it also comes with a handful of responsibility and exasperating expenses. There are many options to consider when starting up your own practice. For example, it is difficult to decide whether owning your own building for your medical practice or renting a medical office space in Los Angeles is more beneficial, as there are definitely advantages to both. There is also the looming statistic that most new businesses don’t have what it takes to stick it out after 5 years and end up folding altogether. Here are some expenses to keep in mind when making the decision of starting your own medical practice.

Start-up Fees

Initial fees to register a small business vary by state but can easily climb up to $800. Physicians are also required to pay government fees in order to practice in each state, another added expense.

Insurance

Another fee for starting your own medical practice is malpractice insurance, or professional liability insurance. This protects doctors from claims made against them by patients or damages from a civil lawsuit. All physicians are required to have this insurance before starting their own practice. Expenses for this insurance vary by state and focus or specialty. For example, a surgeon in California can expect to pay anywhere from $22,000 – $34,000 a year.

Other types of insurance also build the list of expenses. A physician’s own health insurance is one that is highly important, as well as any insurance being offered to their employees. In addition, property insurance for a medical office space in Los Angeles can range depending on location and size.

Equipment

Owners of their own medical practice are also responsible for purchasing all their own office furniture and equipment. This can range from basic stationary like paper, printers, fax machine, filing cabinets, phones, etc, to very expensive computers, patient scheduling programs, and medical tools, which are probably one of the biggest expenses.

Staff

In addition, physicians must keep in mind salaries for their employees. Medical assistants make a median salary of $34,785 and a nurse anesthetist’s median salary in 2019 is $180,100.

Hiring a consultant to help you start your practice is also very costly but may help you save money in the long run. They estimate that starting a private practice can add up to more than $100,000. This does not include continuing costs of owning a private practice to maintain and keep it running.

Owning Vs. Renting

Owning your own office building is another huge expense. Leasing can be a financial nightmare as well. There are, however, ways to maneuver around this, like renting from a medical office space in Los Angeles. Renting with a medical office space takes some of the stress out of starting your own medical practice and is possibly the best option. For example, Boulevard Medical Properties helps negotiate your lease step by step. They will walk you through each step of the way and put together a lease that fits your unique needs.

In addition, Boulevard Medical Properties’ consultants will help you negotiate the design and construction of building your own medical practice. Their specialists will meet with you to discuss your design ideas and take the construction off your hands from there with a hired team of professionals, leaving you with one less task to worry about. Boulevard is also highly conscientious of its energy use and takes the time to practice eco-friendly habits.

Medical Office Space in Los Angeles

If you’ve been considering starting your own medical practice, you may want to consider renting a medical office space in Los Angeles. Working with Boulevard Medical Properties will take some of the more troublesome aspects out of your hands so you can focus on the practice itself and all the other expenses you have to keep in order. Contact us today to learn more about your renting/leasing options.

How to Start a Medical Practice

After years of studying and training to become a practicing physician, the first thing on new doctors’ minds is putting those years of hard work into action. They enter the workforce and begin the work they were called to do. Somewhere along their career, however, they might begin to wonder if there is a realistic way to start their own medical practice and be their own boss. We at Boulevard Medical Properties are here to tell you that starting your own medical practice is an achievable goal if you follow these steps.

Funding

Starting a medical practice is like running a start-up business. You will need to apply for business loans to cover the vast number of building expenses. Things such as purchasing an office building, construction work and remodeling will run up a large tab. Comparatively, you can find a medical office space for lease in Los Angeles to cut down your construction costs and ensure that your office is maintained by a third party. Both scenarios will require some sort of funding and are your first step towards become a small business owner.

Receiving a loan is a terrific way for you and your business to establish credit and have a cushion for the first few years while your business is growing. Doctors who can afford all the expenses themselves should still consider the advantages of a secured small business loan. If you are more partial to renting office space instead of purchasing a whole building, check out the available medical office spaces for lease in Los Angeles to explore this option further.

Insurance Credentials

To accept your new patients’ insurance, you will need to go through the process of applying for your credentials. This process is somewhat lengthy, taking up to several months to complete. Do research to discover exactly what types of insurance you want to accept and check with your state requirements to understand the qualifications your practice may need.

Once you’ve decided which programs you’d like to partner with, you will either accept their general reimbursement strategies, or negotiate new ones based on what procedures you do and what area of medicine you specialize in. While Medicare and Medicaid offer the same reimbursement benefits to the doctors they contract with, other smaller insurances will be able to negotiate smaller, more personalized contracts if you choose to associate with them. This will also widen the number of patients you are able to care for under insurance benefits.

Legal & Licensing

It’s a good idea to enlist an attorney who can help you draft your articles of incorporation, receive your employer identification number and learn about your state requirements for completing a tax registration. You’ll also need to decide what kind of corporation structure you want to follow based on the benefits each type offers. Your attorney will be able to help you research the business structure options and make a calculated decision unique to your practice.

You’ll also want to research the licensing procedures you’ll have to adhere to depending on your state and chosen specialty. Your licensing will depend on four things: state requirements, a national provider identification number, DEA registration and any additional regulations that will be determined by your specialty. Researching the requirements before you begin will help speed up the process in the future.

Challenges

Every start-up business is full of obstacles and starting a medical practice is no different. Some of these challenges include the state you practice in and the special registrations you might have to go through to create a medical business. Next, consider the healthcare facilities that are available in your state, and their proximity to your practice as this competition can either help or hinder your goals. If you want to be certain that there are limited competitors for your specialty, research available medical office spaces for lease and determine if leasing your office is the right choice based on the kind of medical facilities they lease to already.

Finally, there may be a lapse between seeing your patients, administering care and getting paid by their insurances. This gap could become a financial burden on your practice, but you can avoid it by taking down your patient’s insurance before bringing them in for their appointment.

Medical Office Space for Lease

Starting your own practice can be a daunting goal, but if you are able to efficiently navigate the terrain and formulate your business structure effectively, it can also prove to be an incredible success. To find the ideal medical office space for lease in Los Angeles, get in touch with Boulevard Medical Properties today.