If you’re thinking about venturing out onto your own therapy practice, first of all, congratulations! That’s a huge career milestone. It takes an immense amount of courage to bet on yourself and take on the risk of starting a business. It can feel overwhelming and scary, as we didn’t learn how to run a successful private practice in graduate school.

This article will be a comprehensive guide, walking you through the most important steps in launching your practice. When going through each step, think of colleagues or friends who have specialized knowledge or resources in each of these areas so that you can ask them for support.

Connect to Your “Why”

Having a strong intention and mission statement sets the tone for everything else that you do in your business. Spend some time to journal about what made you want to start a private practice and what your larger goal is in starting a business.

Get Your Ducks in a Row Legally

Make sure you can legally practice in the region you’re providing services. This includes registration or licensure with the board that regulates your profession, applying for a professional identifier (e.g. an NPI in the US) and complying with privacy laws.

If you’re in the US, determine if you are a “covered entity” and therefore subject to HIPAA compliance. Secure professional liability insurance. Learn what the requirements of your professional licensing board are for continuing education and put a plan in place for staying up to date on continuing education units. Join a highly regarded professional association.

Prepare Your Financial Plan

Open a business bank account and consider a business credit card. Develop a system for tracking business revenue and expenses. Determine a startup budget for one-time purchases (i.e., office furniture and computer hardware), an annual budget for yearly expenses (i.e., license renewal fees and professional association membership fees) and a monthly budget for recurring expenses (i.e., office rent and practice management software.)

Assemble Your Team of Professionals

The most important person to hire is a tax preparer who can help you with filing business taxes, choosing your business structure, and providing basic bookkeeping recommendations. You may also need an attorney to help you incorporate. If you decide you need additional guidance, a business coach can help tremendously with basic business operations and marketing. When hiring a business coach, be sure to select someone who has specialized understanding of the therapy industry, as we operate under more strict advertising guidelines than most other professions.

Select a Business Entity

If you decide to incorporate, you’ll want to work with a professional or a service to assist you in that process. You can speak with your tax preparer to help you determine what business structure makes the most sense for you.

Decide How Clients Will Pay

Research options such as public systems, private health insurance or self-pay. Each option comes with pros and cons.

Generally speaking, with public systems and private health insurance, you’ll receive a steady stream of client referrals, but the reimbursement rates are lower and there’s more administrative work.

With self-pay, you can set your own fees and maintain greater flexibility, but you’ll need to rely on your own marketing efforts to bring referrals into your practice.

Identify Your Ideal Client

Create your client avatar – a detailed description of who you’re best suited to help in your practice: this can include treatment unit (individuals, couples, families, groups,) demographics of populations you’re passionate about, or presenting issues.

Your client avatar informs key aspects of your practice such as what clinical trainings you invest in, branding, web copy, office location and marketing strategy (such as SEO keywords to target).

Name Your Business

Many solo practitioners name their therapy practice after their own name. If you’re certain you won’t want to expand, this can be the simplest option. However, if you might want to grow into a group practice at some point, it’s wise to use a business name other than your given name. Be sure to check your business name is not already trademarked or registered with a business in your geographical area.

Choose In-Person, Virtual or Hybrid

For an in-person practice you’ll need to acquire office space. For a virtual practice you’ll need to sign up for a secure telehealth platform. For a hybrid practice, you’ll need both.

If you decide to rent office space, start small by renting by the hour to keep your overhead costs low until you have a greater demand for your services. When looking at office spaces, remember to consider factors such as accessibility, parking, waiting rooms, noise/sound-proofing and other factors that may be important to your clientele.

Here’s our comprehensive guide to therapy office décor.

When factoring in your monthly office rental costs, be sure to include expenses such as internet, utilities, supplies and janitorial services.

Determine Policies, Procedures and Boundaries

This includes payment methods, cancellation policy, onboarding/termination practices, communication preferences, professionals to refer out to and professional boundaries.

Talk to practitioners who are already in private practice to find out what the industry standards are in your area. This serves as a great starting point, and you can refine from there based on how you want to run your business.

Get Your Paperwork in Order

Most professional associations will provide boilerplate paperwork that you can adapt to your practice. Never take paperwork samples from a colleague, as they may not have legal permission to use it and therefore cannot legally give you permission to use it.

Choose an EHR, Payment Processing System and Communication Systems

You’ll need an electronic health records system (EHR) that has features that meet the needs of your practice.

Talk to colleagues to find out what most folks are using in your area and what features they like and dislike about the platforms.

You’ll also need to decide how you’ll take payments, business calls and business emails. Some EHR platforms have payment processing integrated into their systems. You can use that, if it’s offered, or use a different service if you can find one that has lower fees.

You’ll need a business phone, answering machine system and phone number. Some therapists use Google voice as a free option, but it’s not as professional as having a voicemail system with an outgoing message. You’ll also need a professional email service and email address for clients to contact you through.

When researching your preferred EHR, phone and email services, make sure they meet the privacy standards that you need to comply with by law in the region you practice.

Gather the Needed Supplies

If you need business supplies such as computer hardware or office furniture and decor, be sure to get all of that in place before you see your first client. If you can sublet an office that’s already furnished and decorated while you build your practice, that’s a great way of saving money and time until you’re ready to invest in your own dedicated space.

Develop a Marketing Strategy

This could include a website, search engine optimization (SEO), directory listings, Google ads, business cards, social media pages, email marketing and targeted networking.

Determine your budget and ability to outsource versus needing a DIY plan of action. Note that developing an SEO strategy for your website can be particularly effective – potential clients heading to Google search to find a therapist can land on your website and reach out to you.

Summary

If you follow these steps, you’ll have a solid foundation upon which to build your private therapy practice. Remember that Rome wasn’t built in a day, and neither is a private practice! Some of these steps (like getting your paperwork set up) are “one and done”, and others take years (like building referral connections in your community.) Think of this as more of a marathon than a sprint. Be patient and kind with yourself in the process. You’ve got this!

Save Time, Energy and Money With The Professional's Mental Wellbeing Toolkit

Starting a private therapy practice is an exciting journey, but it also comes with its challenges – long hours, emotional labor, and the responsibility of managing a business. While you dedicate yourself to helping others, it’s essential to have the right tools to support both your clients and yourself.

That’s where The Professional’s Mental Wellbeing Toolkit comes in. This comprehensive resource is designed specifically for mental health professionals, equipping you with:

• Personal wellbeing tools. Prevent burnout, manage stress, and maintain a fulfilling career.
• Client-facing tools. Evidence-based exercises, worksheets, and techniques to enhance therapy sessions.

Set yourself up for long-term success in private practice.