Once you’ve achieved your goal of becoming a plastic surgeon, you may find yourself itching for more control over your career.
Plastic surgeons can work in large practices, partner in small groups, or take the bold step of launching their own private practice.
Partners have more autonomy than large-practice physicians and practice owners have the most autonomy of all. Which level is right for you depends on several factors.
|
A solo practice might work for you if … |
A group practice might work for you if … |
An employed model might work for you if … |
|
|
|
The solo route can be a lot of work, particularly if you start your plastic surgery practice from scratch rather than buying one from an established surgeon.
That said, owning your own practice puts you in the driver’s seat. You can build a business – and a legacy – aligned with your unique values and goals.
Even if you’re a few years away from acting on your dream, it’s never too soon to start planning. Here’s what you need to know about starting a successful practice in a competitive field.
To start your own plastic surgery practice, you need to set up:
The Business of Starting a Practice
- Write a Business Plan
- Choose the Services You Will Offer
- Name Your Practice
- Choose a Location
- Equip Your Practice
Typically, doctors go into medicine to treat patients. If you’re going to start your own practice, however, you need to look at work through a different lens.
You can’t afford to view your practice just as a doctor. You need to view it from the perspective of a business owner. And that will mean getting comfortable with a lot of things you probably didn’t learn in med school.
Write Your Business Plan
A strong business plan is the foundation for a successful business. It helps you visualize and plan for the myriad details and challenges involved in starting a plastic surgery practice.
With a strong plan in place, you will be better prepared to shine among competitors. It can be the difference between spotting an opportunity first and being caught unawares.
Business planning helps you think systematically through everything your business will need, from legal requirements to daily operations. It’s also required by lenders, who will decide if your business is a good investment based on how well your plan is thought through.
As you develop the business plan for your plastic surgery practice, don’t hesitate to seek expert advice. You can get free counsel from experienced mentors in The Small Business Administration’s SCORE Program.
Parts of a Business Plan
- Executive Summary: This is an overview of the entire plan, including your mission, target market, competitive advantage, and financial projections.
- Business Description: This describes the specific services you plan to offer, the market you will serve, and unique features that stand out among your competitors.
- Market Analysis: Describe the demographics of your market and the clientele you hope to attract. Honestly assess any opportunities or challenges the market may pose, such as population stagnation and upward mobility.
- Competitive Analysis: Identify other plastic surgery practices in the same area. How does your business compare in terms of location, services, and clientele? What will set you apart? Consider offerings, technology, and intangibles such as experience and approach.
- Business Management: This is the nuts and bolts of your planned practice. Outline the organizational structure, including roles and responsibilities. Note your credentials and the credentials you will require of the people you plan to hire. Also list any strategic partnerships or affiliations with other healthcare providers, such as hospital systems.
- Services and Facilities: What services will you offer in the beginning? What kind of facility will you require to do that work? Plan out the square footage, layout, equipment, and technology you will need.
- Business Operations: Imagine a real-world vision of your business’s day-to-day. Include office hours, patient flow, appointment scheduling, billing processes, and records management. You don’t need to choose vendors at this point, but start researching your options. If you can combine multiple operations under a single software license, it can smooth daily workflows and yield cost savings by reducing third-party contracts.
- Regulatory Compliance: Note the licensing and regulatory requirements your practice must follow. These will vary from state to state and may vary based on the types of procedures you plan to offer. It’s important you know which requirements apply to you and how you will make sure the practice stays in compliance.
- Risk Management: No business is without risk. What would happen if legislators passed regulatory changes? Or if the area’s major employer collapsed and took your clientele’s high-paying jobs with it? Identify any threats or challenges your business may face so you can develop strategies to protect yourself.
- Financial Projection: Your business plan should include realistic estimates of expenses and revenues for each of the first three years. Lenders may require you to explain the logic you used to arrive at these numbers.
Choose the Services Your Practice Will Offer
When you’re starting your own practice, focus first on the services with the highest return on investment.
For plastic surgeons, this requires careful thought. It’s wise to offer a variety of surgical and med spa procedures so you have diversity in your revenue streams.
But you don’t want to look at demand alone. Laser hair removal might require a minimal investment in equipment and attract a large number of patients, but the inexpensive treatments have low margins. And if a nearby med spa with no doctor on staff can offer the same treatment cheaper, it can devalue your brand.
While you want to compete with the services offered by other local surgeons, also keep an eye on rising trends they don’t offer yet. You may have an opportunity to secure market share that’s up for grabs.
Finally, before investing in expensive new equipment, Beverly Hills plastic surgeon Dr. Nima Naghshineh suggests considering these questions:
- What staff would be required for this procedure, and how much of their time would it take?
- How long will the procedure tie up facilities?
- How much inventory will it require?
- Is it a marked improvement over what I could do without it?
Over time, you can track demand and profitability and adjust services accordingly.
Name Your Practice
Maybe you already have a short list of names you like. Before you settle on one, make sure it won’t be something you’ll later regret.
- Avoid creative spellings. It might seem distinctive, but they make it very hard for potential patients to find your practice online. Stick with a name that is easy to spell and to remember.
- Many plastic surgeons name their practices after themselves. This is fine as long as your name isn’t difficult to spell. However, keep in mind that it may make hiring additional doctors difficult in the future. When patients visit Smith Plastic Surgery, they expect to be seen by Dr. Smith, not Dr. Jones or Dr. Fabrizio.
- Once you’ve settled on a name, buy the website domain. Even if your clinic is still just a dream and you’re years away from acting on it, secure that URL before someone else does.
Choose a Location
Lock in a location before applying for your practice’s licenses and credentials. That will save you from the tedium of updating your address with every agency down the line.
As a medical practice, your business will be a destination, so you don’t need to worry about finding a spot in a high-traffic area. However, location still matters.
Look for areas where the procedures you want to offer are in demand, where the median income is high enough to afford your services, and where competitors haven’t already cornered the market.
As a plastic surgeon, you’re catering to high-end clientele. Choose a neighborhood your well-to-do clients are likely to know and feel comfortable in.
Next, think about your facility requirements. How many exam rooms will you need? Do you need space for an on-site lab? Consider the costs of retrofitting a space to meet your needs.
While real estate is a good long-term investment, it can be risky to buy a location at the very start of your business. First, it saddles you with the responsibility of maintenance and property tax. Second, it locks you into a location before you’ve tested the market.
Instead, plan to lease space for the first couple of years. This gives you more working capital and greater flexibility.
Equip Your Plastic Surgery Practice
When you choose the location for your practice, you have two options: a refurbishment or a custom buildout.
If the site previously housed another surgical practice, you can refurbish it. There’s a cost savings to maintaining the layout and just updating some of the fixtures.
If you move into a new build, you’ll have to buy everything new, but you can set it up exactly as you like. Everything from the placement of the cabinets to the color of the countertop will be to your specifications.
In the competitive world of plastic surgery, first impressions are crucial. Your patients expect a space that is both modern and luxurious. Cosmetic improvements like updated light fixtures and flooring that might be “nice to haves” for other specialties are “must haves” for a plastic surgery practice to convey the right image.
Make sure patient-facing areas like reception, waiting rooms, and patient rooms are furnished to make your patients feel pampered and at ease.
To save on costs, you can start by furnishing fewer rooms. When you are just getting started, your patient volume is likely to be too low to require multiple patient rooms.
Furnish only the rooms you need, and grow into the rest of your location as business picks up and more revenue flows in.
Financing Your Practice
- The 4Cs of Owning a Business
- Secure Funding
- Hire an Accountant and a Lawyer
- Negotiate with Insurers
- Manage Risk
Understand the 4Cs
Every business owner needs to understand the 4Cs of finance: costs, cash, capital, and control.
- Costs: Know how much it costs to run your business. This includes static costs like rent and licensing fees, dynamic costs like supplies and utilities, and personnel costs like retirement plans and payroll.
- Cash: Even if you budget down to the dime, it’s important to keep cash on hand to cover any urgent, unexpected costs.
- Capital: Capital expenses reflect investments in the business. Construction, office expansion, and new equipment are all capital expenses.
- Control: Your controller tracks where and how money is spent, making sure the practice operates within legal and regulatory guidelines.
Secure Funding
If you can afford to self-fund your new plastic surgery practice, you’ll be ahead of the game. Without a debt load, you can break even earlier and get better lending rates for future purchases.
Realistically, though, with startup costs as high as $3 million, most plastic surgeons will need financing to get their clinic started.
Here are some options you might consider:
- Traditional Bank Loan: Meet with several banks to explore financing options. Smaller locally owned banks often have more benefits for small businesses than large national banks.
- SBA Loan: Look into loans from the U.S. Small Business Administration. SBA loans are competitive, but they generally offer more favorable terms and longer payback periods than banks.
- Grants: If you’re planning to locate in an underserved area, there may be grants available from government agencies and local, state, or national nonprofits. This is an unusual avenue for a cosmetic practice, but it is worth investigating, particularly if your practice will also perform reconstructive procedures.
Hire an Accountant and a Lawyer
As soon as you put the wheels of your plastic surgery business in motion, find a qualified accountant experienced in working with medical practices. Your accountant will help you identify, prioritize, and budget for all the things you need to bring your vision to life.
Don’t start filing legal forms and registrations before hiring a healthcare management attorney. Law is complex and experience is key; the cost of hiring a specialist is far less than the cost of making a critical mistake.
Negotiate with Insurers
When deciding which insurers you want to work with, consider your market. If your area has a few major employers, their employees are likely to be in your patient pool, so it would be wise to accept the plans they offer.
To bill insurers, you need to be credentialed. At minimum, you will need a practice address and a medical malpractice policy. Individual insurers each have a number of additional requirements, and each one may require you to go through their own credentialing process.
Insurance credentialing is an important but highly technical process. If you feel out of your depth, many third-party billing companies offer it as an add-on service.
Manage Risk
Before you start your plastic surgery practice, understand two types of risk: personal and business.
First, consider your own personal risk. Be ready to lose money for the first year or two as you ramp up operations.
Business owners get paid last, after all the other business expenses are covered, so make sure you can afford to skip an occasional paycheck if needed.
Once you’re in business, risk management will be an ongoing concern.
- Manage your credit risk by making prompt payments and not falling behind.
- Reduce safety risks to patients and staff by following regulatory requirements, maintaining a safe physical environment, and adhering to medical best practices.
- Reduce fraud risk by establishing transparent purchasing practices, keeping strict controls on who can access the practice finances, and conducting regular professional audits.
Legal Compliance
Choose a Legal Structure
Business structure dictates how your practice is treated by the government in regard to taxes, licensing, and other legal matters.
Common business structures include corporation, sole proprietorship, LLC, and partnership. There is no one “right” or “best” structure for a plastic surgery practice. Each one has pros and cons, and what is right for your competitor may not be right for you.
Talk to a tax attorney, CPA, or business compliance specialist before deciding on the type of legal structure that makes the most sense for your practice.
Get Licensed
Licensing requirements for plastic surgeons vary by state. Contact your state medical board or a lawyer with healthcare experience to ensure you’re compliant with the rules in your location.
Your practice may also need to comply with local licensing requirements. Some municipalities and counties require clinics to obtain documents such as a business license, pharmacy license, or certificate of occupancy.
Buy Insurance
If you’ve been a part of a larger healthcare organization, you may not have been paying for your own malpractice insurance. That bill can come as a nasty shock to providers striking out on their own.
That will keep your insurance rates relatively modest when compared to high-risk specialties like neurosurgery.
When applying for malpractice insurance, be clear about every service your practice will or may provide and ensure it is covered. Ensure every clinician in the practice, from surgeons to aestheticians to CNAs, is covered.
Talk to your lawyer about the pros and cons of insuring the business and its staff separately, protecting the practice if you should be sued as an individual.
Starting Your Practice’s Operations
Acquire Equipment
Keep your head and stick to your budget when acquiring equipment. Your patients aren’t worried about whether you have a newer model of laser than your competitors. They’re more concerned with the outcomes you can provide for them.
Be selective about the equipment you need to start now and what you can defer buying until your cash flow evens out. Look into lease or lease-to-buy options for particularly expensive equipment.
Shop around for the best deals on medical supplies. It might make sense to get supplies from several vendors with different specialties. On the other hand, you may be able to negotiate a discount if you buy all your supplies from a single vendor. Explore your options and don’t hesitate to ask.
Once your practice launches, delegate inventory management to a medical assistant or office manager. Make it that person’s job to track the levels of supplies, order replenishments, and regularly renegotiate contracts with suppliers.
Hire a Team
Take it slowly with hiring as you ramp up operations. Start with only the most necessary staff, and invest in hiring excellent people who will help you build the business.
Your office manager or practice administrator will be one of your most important early hires. This person will become your right hand, managing the business of the clinic while you focus on serving patients.
Keep overhead low by outsourcing administrative tasks like bookkeeping, payroll, and reception. As the business grows, you can start to bring those roles in-house.
When hiring clinical staff, start with your network. Bring in people you already know and trust, or ask those people for recommendations.
For both clinical and administrative roles, look for applicants who are excited about the idea of working in a brand-new practice. While experience matters, so does willingness to learn, and a willingness to step up when unexpected situations arise.
Purchase Software
The software you use to run your practice can literally make everything you do either easier or harder. It is not the place to cut corners.
An integrated system that combines an easy-to-use EHR with robust practice management tools can save time and money. Your staff won’t have to train on multiple systems, and you won’t have to pay multiple providers.
Look for a system designed for plastic surgeons. It will already be equipped with specialty-specific tools, functions, and billing codes that a generic EHR is likely to miss. Plus, you won’t have to navigate through loads of tools and content that don’t apply to plastic surgery.
Most practices who are dissatisfied with their EHR complain they didn’t receive adequate training. Look for a company like Nextech, with an outstanding training and onboarding process and round-the-clock, U.S.-based customer service.
Market Your Practice
Most cosmetic procedures aren’t covered by insurance – meaning your patients can go to any plastic surgeon they like. It takes a smart marketing plan to get patients to notice your new practice and decide if it’s right for them.
To stand out from your competition, look at their messaging and brainstorm ways you can take a different tack. Don’t be the fourth practice in the area to emphasize years of experience; be the first to emphasize natural aesthetic.
Invest in high-quality photo technology to capture stunning before and after images you can use in your marketing. Nothing speaks to experience and expertise like documentation of work you’ve actually done.
Plan a mix of digital and offline marketing tactics to penetrate the market with your name. Start campaigns six to eight weeks before your practice opens so you have patients booked on day one.
The built-in marketing and lead management tools in Nextech’s practice management software have been shown to increase lead conversion rates by 30% or more, even if a practice cuts its marketing spending.
Starting Your Own Practice Is a Big Leap
Starting your own plastic surgery practice is an exciting – and at times overwhelming – step. Take the time to build it step by step for your best chances of success.
Get your new practice’s operations set up right from the start. Start with a robust, intuitive EHR and practice management system designed to keep your data clean, your business efficient, and your attention focused where it belongs — on your patients.
Book a free demo of our dermatology-specific EHR and practice management software.
See You in San Diego
Plastic Surgery The Meeting | San Diego | Sept. 26-29 | Booth 1236
Learn how Nextech’s EHR and practice management solution helps your practice accelerate revenue growth and focus on patient-centric care. LEARN MORE
