The average cost of medical school in the U.S. is around $218,792, or $54,000 per year. Add the cost of books and school supplies, and you could be paying a quarter-million dollars for a medical degree. However, finishing medical school doesn’t mean you can heave a sigh of relief, at least not yet.
If you plan to start your own practice after med school, you better brace yourself for the expenses. Starting a new medical practice isn’t as affordable as most people think. You’ll need to dig deep into your pockets to become a new doctor.
There are many things to put money aside for, including staffing, marketing, and many other expenses. Understanding the hidden costs will go a long way toward helping your medical practice take off.
In today’s post, we’ll be discussing some of the most common hidden costs associated with becoming a new practicing doctor. You can make proper financial arrangements and run a successful practice.
Paying a Business Consultant
If you only have a background in medicine, your business acumen will be a tad shaky. You’ll probably have to hire a business consultant to help you draft a business plan. The consultant will also help you understand the business aspects of running a practice, such as taxes and bookkeeping.
While most new doctors are eager to get started with their new practices, taking your time to hire a business consultant is crucial. A good consultant will save you a lot of money and heartache in the long run. However, these consultants charge a stiff fee, but it will all be worth it in the end.
There’s no shortage of legal consultants, but ensure you’re hiring the best person for the job. You’ll want a consultant that caters specifically to medical-related businesses. Find physician financial advisors, and they’ll help you chart the best way forward.
Finding and Hiring Staff
Running a new medical practice by yourself is impossible; you’ll need to hire staff. Depending on the size of your facility, you might need to hire a receptionist, a nurse, and even an assistant.
If you’re planning to open a small practice, you could get away with hiring one or two employees. However, if you’re planning to open a larger facility, you might need to hire a team of employees.
The cost of hiring new staff can be quite high, especially if you’re looking for experienced and qualified candidates. The average cost of hiring a single employee is about $4,000. Fortunately, there are many ways to save on staffing costs, like offering sign-on bonuses or competitive salaries.
Complimentary Services and Solutions
Apart from hiring employees, there are a few complimentary services you’ll require to run your practice. Some of these services include legal, IT, and accounting services.
You might need to hire an attorney to help you with the legal aspects of starting a new business. An accountant will also be crucial in keeping track of your finances and ensuring proper budgeting. Additionally, you’ll need IT solutions and services to keep everything in check.
Don’t make the mistake of skimping on these services; they are crucial for the success of any new business, including clinics.
Equipment and Supplies
Another significant cost you’ll need to account for is the cost of medical equipment and supplies. The type of equipment you’ll need will depend on the size and scope of your new practice.
For example, a small family clinic won’t require as much equipment as a large hospital. However, both facilities will still need to invest in essential equipment, like examination tables and medical supplies.
The cost of medical equipment can be quite high, but you can get around this by leasing or renting the equipment. In most cases, new practices will lease their equipment for the first few years before buying them outright. They can also explore financing options to afford the said equipment.
Of course, you’ll need a physical space to run your new medical practice. The cost of renting or buying office space will depend on the location and size of the facility. For example, a small clinic in a rural area will cost much less than a large hospital in an urban center.
The good news is that there are many ways to save on office space costs. For example, you could share an office with another business or rent a smaller space during the first few years of operation. Although it might hurt your “professional” reputation, it’s good for a start.
Operating and Maintenance Costs
Last but not least, you’ll need to account for the cost of operating and maintaining your new medical practice. These costs include utilities, insurance premiums, and repairs. You might also have to pay marketing fees depending on your marketing strategy.
Try negotiating with your landlord for a lower rent or asking your suppliers for discounts. There’s no guarantee they’ll say yes, but it doesn’t hurt to try.
Last but not least, you’ll need to purchase insurance for your new medical practice. This is essential to protect yourself and your employees from potential liability.
The insurance cost will vary depending on the type of coverage you need and the size of your practice. However, you can get around this by shopping for the best rates and comparing them. You can also purchase a policy covering both your employees and your practice.
All in all, the cost of starting a new medical practice can be quite high. However, there are many ways to save on costs, like leasing equipment or renting office space.
Start Your New Doctor Practice the Right Way
Starting your own medical practice as a new doctor isn’t cheap. However, by taking the time to understand the costs of being a doctor, you can make proper financial arrangements and run a successful practice without breaking the bank.
Check out the other posts on the site for more informative content.