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The Business

The Business

Author: Rob Eubanks
Description:

This lesson discusses the business aspect of a successful private practice.

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[MUSIC PLAYING] So in this lesson, we're going to cover the following topics. Private practice as a business, startup and ongoing costs, financing, and controlling costs.

Costs are a significant concern in business, and it's important to make a profit, as well as to help others, in order to stay in business. Good business owners utilize a budget, track their cost, and critique and analyze how and why deviations occur. All right. Let's get rolling.

Private practice is a business. And one goal of being in business is to make a profit. How valuable profit is to any one person is linked to his or her values. Now, I really enjoy getting paid well for the hard work that I do. I find that many counselors, however, feel guilty about making a living off other people's struggles.

Now, remember that this is a career, and you offer valuable service and have worked very hard to attain your professional credentials that allow you to help people in this very special way. So it's OK to be fully passionate and to give maximum effort to your work as a counselor and to make a good living from doing it. So don't forget that building in pro bono and reduced-fee clients is a common practice in our field as well. So this can help balance the sense of unease that may still tug at you.

So it can be difficult for some counselors to ask for payments and be fiscally responsible because of the difficulty in balancing client need for service and client ability to pay for services. So even if profit is not one's ultimate value, it is important to consider the following. In order to provide services and to help meet people's needs, you must pay your bills.

Running a business will include startup costs, as well as ongoing costs. Startup costs will include everything needed to get the business up and running. Ongoing costs are costs that will continue beyond the startup phase. Note that some costs, such as paying rent, will be startup costs as well as ongoing costs.

So let's focus on startup costs. Starting a business includes consideration of financial startup cost. Startup fixed cost are the costs necessary to get the counselor up and running to do business and do not need to be extensive.

Financial startup costs can be quite small or large depending on one's values, goals, and objectives. So for private practice startup costs, they usually include buying several things for the office, such as the following. Office furnishing, chairs, couch, desk, waiting room furnishings, electronics, computer, printer, phone, fax, technology-related media such as a website or blog, paper advertising materials such as business cards or brochures or client handouts, assessment and testing materials such as the Beck Depression Inventory, MAST, or MMPI, and other items such as a locked file cabinet, waiting room materials, or toys if seeing kids.

You can spend a little or a lot depending on your desire for new or used materials and the level of quality that you want. One of the most important and significant financial startup cost and ongoing cost will be a location to do actual counseling, whether it be via rent or purchase.

Now for ongoing costs. Rotating costs are the monthly costs necessary to keep the business running and tend to be more extensive. These include rent, billing, accounting, health insurance, advertising, phone bill, cable bill, and bills for periodicals possibly, such as Psychology Today.

Financing is however the counselor plans to pay for their startup and ongoing costs. Private practitioners will want to open a business banking account. A business banking account is important because it separates personal expenses from business expenses. And although it may seem insignificant at the time, expenses, even small ones, add up, and having an account to track these expenses is very helpful.

Financing will most often be cash that has been saved by the counselor. In some cases, small business loans are sometimes available, especially when purchasing real estate for the business. Now, loans require a business plan with identified equity and a structured payment plan.

Owners may need to do more than counsel clients in order to control costs, including learning how to bill insurance, learning how to build clients, learning how to manage a website, learning how to network. On the other hand, time is money, and choices have to be made between practicing counseling to earn money and hiring professionals, such as a biller, accountant, or an office manager, to also earn money due to the amount of time needed to complete counseling.

Ultimately, the counselor will need to revert back to their values to determine which is most important. So do you save money by learning how to bill and then billing insurance, or do you save time by hiring a biller? The choice-- it's up to you.

So here's what we covered in this lesson. Private practice as a business, startup and ongoing costs, financing, controlling costs.

[MUSIC PLAYING]

Notes on The Business:

(00:00-00:42) Introduction

(00:43-02:02) Private Practice as a Business

(02:03-04:24) Startup and Ongoing Costs

(04:25- 05:14) Financing

(05:15-06:09) Controlling Costs

(06:10-06:28) Summary