Starting A Mental Health Group Practice
Starting a mental health group practice is a rewarding endeavor because in addition to helping the clients you work with directly, you’ll have a positive impact on the lives of every client of each of your therapists.
Perhaps you’ve worked for other group practices and didn’t love the work environment – you were overworked, underpaid, and underappreciated. Working in private practice gives you more control when you’re looking to have a more significant impact. Starting a group practice offers you the opportunity to create a work culture that helps each clinician thrive.
Starting your group practice can feel overwhelming, especially when you’re just getting started. With a group practice, you have to manage a more extensive practice caseload and the needs of your staff. With the proper support and careful planning, you can focus on building one piece at a time until you have a successful practice.
How Does a Group Practice Work?
A mental health group practice is a team of therapists who operate under the same mission. Typically one therapist begins the practice and takes care of the administrative work until the practice is large enough to support a full-time or part-time office manager. A group practice requires
- Systems for intake and discharge processes, documentation, accounting, invoicing and payments, cancellations, fees.
- Marketing for not just yourself but several other people (don’t rely on referrals).
- Recruiting, interviewing, and hiring employees and contractors.
- Legal structures and financial processes, including accounting and bookkeeping.
- Managing your team and forming a culture where clinicians can thrive.
What is an Independent Group Practice?
Many business owners opt for one type of group practice is an independent group practice. Each therapist is a contractor in private practice. There are one or two owners of the brand in an independent group practice. Each additional therapist typically pays a fee.
This model allows greater independence for each practitioner while reducing the management needs of the owners. When you hire independent contractors, you won’t need to worry about salaries or health insurance costs. Each practitioner will set a fee for each appointment, with a small percentage going to the practice.
How Are a Solo Practice and a Group Practice Different?
While both a solo and group practice give you the flexibility of running your own business, there are things to consider when deciding on a solo or group practice. When you start a solo practice, your goal is to fill your calendar with enough regular clients to support your own income needs. You manage your financials, schedule, and policies in a solo practice. There is minimal conflict because you are both the boss and employee. You also bear all of the risks associated with being a business owner.
Transitioning to group practice requires switching from therapist mode to business mode. You will likely spend much of your time involved in the management and administrative tasks you otherwise would spend doing clinical work.
To be successful in a group practice, you’ll want systems for handling every aspect of the practice, including the new client intake process, appointment scheduling, insurance, conflicts among coworkers, and bookkeeping. Your business will not rise to your level of effort – it will fall to your level of systems.
In addition to management needs, a group psychotherapy practice will require office space for every provider, rather than just a space for you in a solo practice. These needs affect the amount of time you’ll spend building your practice and your income and expenses.
What Are the Advantages of Opening a Group Practice
If you’re ready to open a private therapy practice but struggling to decide between a solo or group practice, you may wonder what the advantages of a group practice are. The advantages of opening a group practice are:
- You can serve more clients.
- You have the support and camaraderie of coworkers.
- You have a more significant potential for growth.
What Are the Disadvantages of a Group Practice?
Starting a group practice is not for everyone. Some therapists prefer to stick to clinical work and don’t want to switch to being business owners. Some disadvantages of opening a group practice include:
- Needing sufficient start-up funding.
- Learning how to be business-minded instead of clinician-minded when required.
- Managing employee conflicts.
How Do I Transition from Solo to Group Practice?
Once you’ve considered the benefits and risks of a group practice Vs. solo practice and decided to transition to a group practice, you’ll need to complete numerous tasks. Use this checklist to help you get started.
- Write a group practice business plan.
- Ensure you have the right technology.
- Review laws and regulations to ensure compliance.
- Determine who you need to hire.
- Hire other providers and staff.
How Do I Write a Business Plan for a Mental Health Group Practice?
One of the most critical steps in building your business is creating a mental health group practice business plan. A business plan serves as your guide for every decision you make. A business plan is never set in stone – you can change it as you deem necessary – but having a plan in place will allow you to move full-steam ahead toward your goal.
When creating your business plan, include the following:
- A mission and vision that considers why you practice therapy, how your private practice assists others, who you want to work with, what personal values contribute to your mission to help others.
- A description of your business structure: niches you work in, therapy practices you employ, age groups and populations you work with, special skills (language, credentialing, etc.), number of clients you see each week, and how many staff members you’ll employ.
- A financial plan which includes software or technology fees, staff salaries, office rent and utilities, office products. You’ll also need to plan how much you’ll pay yourself and each provider. This part of the plan is where you’ll address things like accepting insurance or using a sliding fee scale. Be sure to note your plan for funds to get started.
- A marketing plan covers the types of marketing you’ll do (radio, print, social media, etc.). You should also include how much time you’ll spend each week on marketing and any parts of marketing you plan to outsource (content creation, website building, etc.)
- Goals for the future. Your group practice should be growth-focused to attract the best therapists to work with you. You’ll want to make goals for your business that are specific, measurable, achievable, realistic, and timely.
What Technology do I Need?
Technology needs will vary based on the business model you choose. The popularity of web-based or phone-based therapy services since the COVID-19 pandemic means you have more options than ever. Whatever business model you choose, make sure each provider has the necessary technology available to support their clients. Consider internet speed, software needs, mobile or wired phone service, computers, etc., that will ensure you reach the number of clients you need to support your income needs.
What Laws and Regulations Apply to Group Practice?
The laws and regulations you’ll need to consider for your group practice vary based on where your practice is located. You’ll need to ensure any providers you hire are licensed in the area you choose to serve. You’ll also be required to adhere to HIPPA regulations and small business rules from the IRS. You may find it helpful to find a mentor or business coach who has started their group practice to get more information on adhering to local regulations.
Who Should I Hire?
The number of clinicians you hire should reflect the number of clients you want to serve each week and leave space for growth. At first, you may have gaps in schedules that therapists can fill by taking on some of the administrative tasks. Just be sure to communicate about those needs and expectations upfront. The people you’ll need to hire include:
- enough providers to cover your current and desired caseload without stretching your income too thin (you’ll have to pay yourself, too!).
- Office or administrative staff (consider remote roles to reduce overall costs).
- Content creators, web designers, graphic designers, and other people to help with branding and marketing.
- A business coach to offer both support and accountability as you reach your goals.
What Should I Consider When Hiring?
When hiring practitioners, consider how many part-time or full-time clinicians you’ll need to hire or whether you want to work with independent contractors. You’ll want to consider health insurance needs and salaries. Be sure to update the financial section of your business plan accordingly.
It’s also important to consider the various services you want your practice to offer and the clients you wish to serve. Hiring practitioners with appropriate credentialing will ensure you meet the goals set in your business plan. Consider hiring bilingual or multilingual practitioners to provide services to a broader group of people.
Starting Your Group Practice Requires Support
Starting a new business is exciting, rewarding work that will fuel your forward motion, but the stress of managing every aspect of a company can risk burnout. You’ll need support and accountability as you set up your group therapy practice.
Soribel Martinez, LCSW, is a psychotherapist with over twenty- years of clinical experience who started her group practice, SMPsychotherapy, in 2018. She scaled the business to include over thirteen practitioners and covers clients in Connecticut and New York.
Now, Soribel is offering her coaching services to people wishing to build or scale their therapy practice into a successful group practice that provides therapy services to those who need it most while protecting the needs of clinicians. She also knows how to ensure you make the money you want and get the flexibility to live the life you desire. That’s why you’re starting your practice, after all.
Schedule a FREE Business Consultation Call today to find out more about Soribel’s business coaching services. She’ll learn more about your current business, your goals for scaling your practice and provide her recommendations for your next steps.