You’ve finished your classes, you’ve graduated, and all the congratulations and parties are over.
You’re a new doctor of chiropractic. Now what?
Go solo or partner?
New practitioners, once they’ve been licensed, mainly have two choices: they can open their own business or go to work for someone else. “In the past, a high percentage of students did come out of school to start their own practices,” says Jeremy Brubaker, DC. Recently, he says, as student loans have increased, there has been a trend for new grads to gain experience as associ- ates or independent contractors until they feel comfortable in the field and generate enough capital to establish their own practices.
“Doctors coming out of chiropractic school, if they are not confident in themselves or their chiropractic abilities just yet, should definitely associate,” says Pamela Johnson. “We see two types of associates—temporary and career. Some doctors really just want to treat and heal people and would rather not be business owners. That is great—the profession needs them. They would be career associates. Others want to gain some experience adjusting and diagnosing or need to be financially more stable before starting a practice, so they are more a temporary two-to-three-year associate.”
As with any career choice, there are advantages and disadvantages with either option. Kirk Parge, DC, PsyD, says that associates won’t make the same amount of money as they would if they had their own practices, they will have to answer to someone else, and they can be always be fired.
Nevertheless, for some this would be the better choice.
But suppose you want to establish your own business. Where do you start?
Launching your own practice can feel overwhelming, so it’s important that you’re prepared. “The first thing new practitioners need to do is get help from those who have done it success- fully in the past and are still very successful,” Brubaker says.
“Starting any business, especially a chiropractic practice, without a sound system for operating a business, managing staff, marketing, and proper patient procedures is a recipe for disaster, as most new practitioners have a limited skill set in these areas.”
“The chiropractor who has no business savvy will be swinging for the fences at night with no lights on,” Parge says. “New chiropractors really have one chance to get this right. It is like a high-hurdler running a 110-yard dash; if they trip and fall on the first hurdle, there is not a good chance of them winning the race.”
Setting up your own business can take anywhere from four months to a year. Parge says that his program is geared to get a practice up and running in 90 days. His firm’s practice start-up manual lists more than 50 steps to take before opening your practice doors.
If new practitioners want to do the work themselves, Brubaker says they can do much of the planning for their businesses in the last few quarters of school, shortening the time needed for opening after graduation.
Working with a mentor, hiring a company that can advise you on how to set up your practice, or following a proven system that walks you through establishing your business are key strategies. If you don’t know what you’re doing—and you don’t seek the proper help—you could be out of business in no time.
Location, location, location
Finding the right location for your practice is crucial for many reasons— you need patients and you need to make sure that you can live within commuting distance in an area that you like. Chandler George, DC, suggests new practitioners use the internet to research their ideal patients and where they’re located. “This is very important,” he says.
“They need to decide where they want to practice first,” Johnson says. “Doing in-depth demographics and having a coach or mentor assist in dissecting those demographics is essential. However, even poor demo- graphics can be overcome with hard work and a system.”
Brubaker advises new DCs to set emotions aside and find a location that makes good business sense, as opposed to just finding somewhere they want to live.
Once you’ve determined the area where you want to open your practice, check out specific building locations. How much room you can afford will initially depend on price and the location you choose.
“Some doctors will find that in their area, they can only afford 800 square feet, while in another area, a space of 2,400 square feet is the same price,” Johnson says. “The average recommendation for a one-doctor office with a three-year lease would be 1,200 to 1,500 square feet. This allows for plenty of growth when the floorplan is set up correctly.”
Brubaker agrees that 1,200 square feet can be adequate for a solo practitioner with staff.
But don’t rush to sign a lease until you’ve written out a business plan and secured financing. “Remember, a lease is a liability that you can’t get out of. Be careful,” George cautions. He recommends that you hire a lawyer who understands contract law regarding building leases. He also says not to overextend yourself regarding the size of your practice. You can always expand into more space down the road.
Get down to business … plans
Before you head to a bank or other lending institution to seek financing, you will need a business plan. If you’ve never written one before, get help. In addition to books that cover how to write business plans, there are tons of websites that can help as well. George recommends using Live Plan (liveplan.com) or something similar.
Coaches, mentors, and practice guidance companies can also help you write a thorough business plan.
Brubaker says that your business plan should include everything from the equipment you will buy or lease to projections about what your location and operating expenses will be.
Show me the money
Once you’ve gathered the required information, it’s time to approach a bank or other lending institution. Remember, you are meeting with a banking professional, not a college professor, Johnson says. Don’t offer a business plan that you wrote in school. “It needs to be specific and clear,” she says. “This means that ‘more’ isn’t always better.”
Brubaker says you’ll have to present solid projections. “One of the biggest mistakes in any business is to open underfinanced without adequate working capital to allow the business to hit black ink. I am all about keeping expenses and overhead at a minimum,” he says. “There is no magic number for opening an office as markets and market pricing can dictate that.”
Bring in the pros
The next steps in the process are to set up your business structure and apply for licenses and the necessary insurance plans—including malpractice. “Doctors will use an attorney or an accountant to set up their corporations—we generally recommend an LLC/PLLC—and then have an attorney review the lease agreement and an accountant to assist with quarterly and annual taxes,” Johnson says.
The health insurance billing process can be overwhelming for a new graduate just opening a practice.
“We have very clear and specific steps to getting in-network and then understanding how to bill and collect,” Johnson says. “A new grad won’t be able to start the process until they are licensed and have a location. So under- standing that you will likely open as an out-of-network provider for the first few months is important.”
Once you have a location, unless you are purchasing a previous chiropractic practice, you will need to have the space redesigned. Johnson suggests getting contractor bids and timeframes for a build-out. Remember, she says, that some cities can take four to eight weeks just to issue permits.
“In setting up offices, creativity comes into play. It is all about flow,” Parge explains. “Arrange the rooms such that maximum patient visits can be attained with minimal movement— all with the idea of providing the best services. The most effective treatments with the least movement and confusion are ideal. Then, temper the office with the five sensing techniques—sight, smell, sound, touch, and comfort.
What experiences will the patient come away with aesthetically?”
As for equipment, really think about what you need versus what you want. Then decide what you want to lease or buy. “Start with a clean and professional look, and expand as the business flourishes,” Brubaker advises.
Get the word out
You should start marketing your practice three or four months before you open. If you don’t have patients, you don’t have a practice.
Having a website and a presence on social media, and even taking ads out on Google, in local publications, or websites that target your marketing area can bring people to your business. Johnson says that while these are all important, they will not make your practice.
“It’s important for the doctor to be out in the community. By far, the best results for new patients comes from face-to-face marketing and ‘lunch and learns’ that are specific to chiropractic,” she says. “Doing a class on things outside of chiropractic will not increase your new patients.”
Be smart with your marketing money. Johnson says that most new practitioners don’t have a ton of money for marketing, public relations, etc. But some creative approaches to marketing are remarkably cost-effective.
George suggests that new DCs send out a press release about their new practice three months ahead of the planned opening, and then again with one month to go. After launch, send out another. In the first year, plan on sending out between six and 10 press releases about your practice.
Consider doing a video press release, too, which is less expensive and will help you be found online, George says. You can also set up a YouTube channel with videos that promote your business page.
Recruiting your team
This is one of the most critical steps in setting up your practice. “Remember, the first exposure the patient has with your office is the person answering your phone or sitting at the front desk,” Parge says. He suggests you look for people who are competent, people-oriented, team players, and willing to start part- time and grow with your business.
It’s crucial to open with some kind of staffing. Johnson says it looks more professional and it’s important to protect yourself; it is best to have another person around when you’re treating patients.
Having staff doesn’t let you off the hook, though. Parge says you need to know all aspects of your practice— including billing programs, scheduling, and collections—because if a staff member gets sick or leaves without notice, and you don’t know how to run that part of your business, it could have disastrous results.
Buying your first or opening another
If you’re thinking about buying an existing practice instead of opening a new one, keep in mind that there is a lot involved with purchasing a business. “I beg any doctor looking to buy a practice to contact someone who has experience and a proven track record in analyzing and dealing with purchases,” Johnson says. “This is not an accountant or a seller’s broker, if they have one.
There are specific things that need to be assessed when buying a chiropractic clinic—that accountants, attorneys, and mentors won’t know how to analyze.” You’ll want a specialized consultant who knows what to watch for.
If you’re an established chiropractor looking to open a second office, George suggests that you only do so if your first location is maxed out. “Most have not,” he says, and admits he learned this lesson the hard way himself. In most cases, one large busy clinic is better than a few smaller ones.
Be sure that your main location is financially secure before getting a second practice, Johnson says. “And realize the true cost if it isn’t. If you are not going to have an associate run the second practice, then what ends up happening is you’re diverting time and energy from one to the other, and you’ll have two struggling practices.”
Brubaker agrees: “No matter how experienced the DC, starting something from nothing takes loads of energy, focus, and determination.”
You don’t want to have double the overhead with a second location and then split your time in between them, only to generate the same revenue. “Staffing is key to multiple locations, as most practicing DCs know staff can make or break a practice—and that includes associates and partners,” he says.
You can do it
Although opening a new practice can seem overwhelming, it is doable. But you’ll need the best guidance and help that you can find.
“Despite what new DCs might hear from naysayers, the chiropractic profession is a great place to be right now. They can often pay student loans off, and do it in less than five years,” Johnson says. “But doctors need to know what to do, and when and how to do it. The profession is ever- changing, and it is imperative to keep up. Get a coach, get a mentor—but make sure it is someone who has proven success in what you’re looking to do.”
Take heart in that if you successfully establish one practice, you’ll have the keys in hand to repeat the process when you think the time is right.
Michele Wojciechowski is an award-winning journalist, humorist, and author of the book Next Time I Move, They’ll Carry Me Out in a Box. For more information and to contact her, visit wojosworld.com.