Where do I set up shop? This is possibly one of the most substantial hurdles to setting up any private practice. The space you choose to start your practice will resonate a very important first impression to both patients and referring physicians. From an aesthetics perspective, the space should be welcoming and comfortable for patients. Does it effectively represent your brand and allow you to provide expeditious and patient-centered care? Despite every clinician wanting to realize this mission, there is the competing issue of the costs to build out a space to achieve this. Depending on the size of your chosen space, building out a doctor’s office and purchasing equipment can run between $300,0000-$500,000+, a relatively lofty ask for physicians who are starting new or making the transition from an employed model of practice.
The costs of building out a medical office, and operating it effectively, create overhead. Simply put, overhead is a recurring and persistent financial burden that guarantees one thing, it will always eat into what you eventually take home to support your family and lifestyle. Along with the expenses pertaining to your lease, staff, supplies and other costs (utilities, insurance, benefits, marketing etc.), a new practice will quickly face the challenge of burning through cash on hand during the most critical start-up phase, when revenue from billable clinical activities is lowest. New practices experience this effect all too often and it is the most common reason why only 2/3 of practices survive beyond two years. Remember that your practice is carrying that overhead when your office is open or closed. Whether you’re seeing 20 patients in the clinic or relaxing at the beach on vacation. It’s an important reality check that commonly straddles many physicians to their offices for endless hours, a major contributing factor to physician burnout.
One of the biggest mistakes new providers make is the typical ‘Goldilocks phenomenon’ of choosing a space which is either too large, or conversely too small for their needs. It’s a difficult issue to straddle, you want a space your practice can grow into, but taking on the additional overhead creates unnecessary personal and financial burdens. On the flip side, a space that’s too small will create a perpetuity of inefficiencies which can stranglehold a practice’s growth.
Novel physician practice solutions like Cowork Medical allow physicians to adeptly overcome challenges in managing these space and overhead challenges: