If you already run a solo practice, you might think that evolving into a group practice would be a relatively easy transition. After all, you have already incorporated your business, set up an EHR & practice management solution, and established your website and social media. However there are some additional costs to consider as you prepare to expand into a group telehealth practice. Below, we break down the key expenses associated with expanding your practice. 

Initial cost of starting a new medical practice 

The initial cost of starting a new medical practice can be substantial, whether you’re offering in-person services or operating a telehealth practice. While transitioning from a solo to group practice can give you a head start on some initial steps and costs, there are probably going to be necessary updates as well as additional steps required. 

For practices offering in-person services, the upfront investment can be substantial. Some of the larger expenses to consider include: 

• Real Estate: Leasing or purchasing a larger space is one of the most significant expenses. The location and size of the practice will heavily influence these costs.
• Renovations: Customizing the space to meet the needs of a group practice, including constructing additional exam rooms, installing specialized medical equipment, and ensuring compliance with healthcare regulations.
• Medical Equipment: Investing in more extensive medical equipment, such as exam tables, diagnostic machines, and treatment tools to accommodate multiple practitioners.

For practices focusing on virtual delivery of care, your business can forgo some of the eye-watering expenses above, but also won’t be able to rely on the organic traffic that can come from maintaining a physical presence. Therefore, investing in the best available technology, top-notch security, and marketing are important for successful expansion. 

• Technology: Investing in robust telehealth platforms, electronic health records (EHR) systems, and practice management software is crucial, and serve as the lifeline for your business. These systems should be designed to support multiple providers, offer seamless patient communication, and ensure data security.

• Licensing and Compliance: Ensuring compliance with telehealth regulations across different states can incur significant costs. This includes obtaining multiple state licenses for practitioners and adhering to telehealth-specific legal requirements. While telehealth offers limitless opportunity, it is important to be strategic in your expansion so that your business remains compliant and profitable. 
• Marketing and Branding: Developing a strong online presence and marketing strategy to attract patients to your telehealth practice. This involves website development, online advertising, social media engagement, and search engine optimization (SEO). As telehealth is increasingly popular, the competition for a strong online presence is getting higher, and requires attention and maintenance. 

Operational costs of a private practice

The operational costs of a private practice increase when transitioning to a group practice, with a lot of these costs being frontloaded. While these operational changes can be costly, both financially and in time spent, these expenses are important for establishing a solid foundation for a group practice. 

Planning and Structural Changes: Establishing a group practice involves considerable time and effort in structuring the practice entity. This includes drafting partnership agreements, setting up governance and decision-making processes, and addressing liability and malpractice insurance coverage. These foundational steps are crucial for a cohesive and legally sound practice.

Upgrading Technology: Investing in an advanced telehealth, electronic health records (EHR), and practice management platform is essential. These systems must support multiple providers and ensure seamless patient communication, internal communication, data security, and efficient management of practice operations.

Establishing Workflows and Processes: Significant time is required to develop and implement well-structured workflows and processes. These need to be integrated into the practice management platform and EHR to ensure a smooth operation. For providers accustomed to working solo, early setup of these systems is critical. A unified approach with well-thought-out processes and workflows can significantly reduce administrative burden, confusion, and overall costs.

While the initial setup and operational costs of a group telehealth practice can be substantial, careful planning and investment in technology and processes can create a more efficient, effective, and scalable practice.‍

Hidden costs

When considering the cost of starting a private medical practice in telehealth, there are expenses that may not be immediately apparent but are important all the same. 

• Insurance: Telehealth practices must carry malpractice insurance, which can be higher due to the nature of remote care. Additionally, cybersecurity insurance is essential to protect against data breaches.
• Legal Fees: Consulting with healthcare attorneys to navigate telehealth regulations, draft employment contracts, and ensure compliance with privacy laws such as HIPAA.
• Patient Acquisition Costs: Beyond initial marketing, ongoing efforts to attract and retain patients can be costly. This includes digital marketing campaigns, referral programs, and partnerships with other healthcare providers.

The overall average cost of starting a medical practice

The overall average cost of growing to a group practice varies widely based on location, size, specialty, and delivery of care (virtual versus in-person). To create a budget for your expansion, it is helpful to assign cost ranges for the following expenses:

• Real Estate: The cost to lease or purchase a building, renovations to be completed, and ongoing maintenance. 
• Equipment: Medical equipment, office furniture/supplies, and technology can be essential parts of your group practice. 
• Advanced Technology: Upgrading to more robust telehealth platforms and EHR systems capable of supporting multiple providers and ensuring efficient, secure, and compliant operations.
• Staffing: Hiring additional medical professionals and administrative staff to manage the increased patient load and maintain smooth operations.
• Planning and Structural Changes: Structuring the practice entity, drafting partnership agreements, establishing governance and decision-making processes, and ensuring comprehensive liability and malpractice insurance coverage.
• Extensive Marketing: Developing a comprehensive marketing strategy to attract a larger patient base, including digital marketing campaigns, social media engagement, and search engine optimization (SEO).
• Workflows and Processes: Significant time and resources are spent establishing well-structured workflows and processes. Integrating these into the practice management platform and EHR is crucial for reducing administrative burdens and operational confusion.

Lower costs with Healthie's services 

Whether you’re new to Healthie or currently using the platform as a solo provider, it’s easy to upgrade to Healthie’s EHR and practice management solution for group practices. The group plan provides functionality for internal communication between providers, the ability to collaborate on charts and programs, and the setup of controls and access permissions for all members of the practice. Healthie provides an organized and customizable foundation for you to build your practice. 

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