jmj11 Posted April 18, 2011 Share Posted April 18, 2011 I'm within 4 weeks of opening the doors to my clinic. I thought this would be a good time for me to give some advice on what I've learned thus far and how I would have done things differently. Realize that I spent about 4 years researching this before I started, still there were some big surprises. I spoke to three PAs who had gone before me. I heard a theme (without specifics) that is is harder than they expected and cost more. So, here is what I would suggest. I will be back in a few months, once we are solvent I hope, and add a few more. Costs. I won't go into details but I suggest that if you are opening a two person family practice clinic, that you plan on using $100K before you are self-sufficient. If you are a specialty clinic, as I am, you can get by with less. I'm still shooting for a total of 85K up front costs. Time Off. I, like most PAs, have to work to pay my bills. So, I did not have the luxury of quiting my old job and focus on starting the new clinic, with no income for 6-9 months. I strongly suggest that you make contact with all your vendors (cable, telephone, etc) and then take at least one week vacation to give these nursing pups your total attention while they install and set up the office. Otherwise they will bug the hell out of you while you are trying to see patients. Loan. The biggest lesson I've learned is, if I had this to do over, I would not borrow one red cent from any bank. I had met with the banks before I even started this venture. They explained in detail the steps of getting a SBA financed loan. They painted a very rosy picture. They estimated that they would have an answer in 10 days and the money would start to flow in three weeks. BS!!!! Because you are a PA, and for no other reason, you are automatically placed on the highest risk category. I had an impeccable credit rating and history. But this loan process has been a nightmare. I submitted my glowing business plan and paper work on December 10th. It is now April 18th and I've yet to see a penny. Yet, I have jumped through about a thousand hoops, or so it seems. Because I'm a PA I got the worse rate on the loan. The SBA said that the maxim down was 30% however, they are making me pay 35%. I have been through 5 cycles where the bank said that I would have money in a week, only to receive the horrible news that they found a new level of hoops they want me to jump through. In the first time around I got SBA approval but the bank (Wells Fargo) underwriters kept me in eternal limbo. The underwriters could not understand why any patient would want to see a PA when they could see a doctor (80 miles away) for the same condition. Then I got a new bank. The new bank approved the loan but then we had to apply all over to the SBA. Now it is the SBA that has me in eternal limbo because they see a PA-owned clinic as bizarre.. So, I suggest that if you have a rich relative (as a NP friend of mine did) go to them for money. If you have a family member who is the business loan officer at a bank, you might consider them. But, if I had it to do over, I would have done it this way. I would have put my personal cash (in my case 30K) in the company account. Then I would get a credit card with 100K limit. I would pay every possibly bill with a credit card, saving the cash only for things that can not be paid by credit (lease, salaries). I know that this sounds crazy, especially with an 18% interest rate on the card, but it would save a huge amount of time and energy that you could devote to the business. I estimate that I've spent over 400 hours doing paper work in the last 5 months for the banks and SBA, many of it over and over (because they kept loosing it). As soon as the doors open, I would make paying off the credit cards the number one priority. So that's the scoop from the trenches. Link to comment Share on other sites More sharing options...
FSUnoles Posted April 19, 2011 Share Posted April 19, 2011 If you take away the horrible loan process (what a joke) how do you think you would feel about the process so far? For instance if you didnt need the loan or by some magic inherited a large sum of money (haha wouldnt that be nice) Link to comment Share on other sites More sharing options...
jmj11 Posted April 19, 2011 Author Share Posted April 19, 2011 If you take away the horrible loan process (what a joke) how do you think you would feel about the process so far? For instance if you didnt need the loan or by some magic inherited a large sum of money (haha wouldnt that be nice) The stress 80% loan, 15% malpractice (taking 3 months to write a policy) the rest 5%. Link to comment Share on other sites More sharing options...
cobramarty Posted April 19, 2011 Share Posted April 19, 2011 Sounds like marriage, 'stress 80% over money'. Link to comment Share on other sites More sharing options...
2010PA Posted April 30, 2011 Share Posted April 30, 2011 Good write up and best of luck to you. I'm currently Active Duty military and plan on retiring here in 10 years Then I plan on opening a clinic. I'll take your advice and keep my wife (FNP student currently) as the primary for a SBA loan. But she's wanting to open a small dialysis clinic since that is her background. Link to comment Share on other sites More sharing options...
jmj11 Posted May 31, 2011 Author Share Posted May 31, 2011 Update: Tomorrow we see our very first patient. This is after about 10 months of hard (very hard) work. The good news is that schedule is completely full for the next three weeks and we have just started to market. It will feel sooooooooooo freakin good to start to see money flowing into the bank rather than out of it. I've spent 57K to date, and owe (haven't been billed yet) on about 8 grand more. It takes a village (of vendors) to start a practice . . . so it seems. Link to comment Share on other sites More sharing options...
Moderator ventana Posted May 31, 2011 Moderator Share Posted May 31, 2011 Update: Tomorrow we see our very first patient. This is after about 10 months of hard (very hard) work. The good news is that schedule is completely full for the next three weeks and we have just started to market. It will feel sooooooooooo freakin good to start to see money flowing into the bank rather than out of it. I've spent 57K to date, and owe (haven't been billed yet) on about 8 grand more. It takes a village (of vendors) to start a practice . . . so it seems. YYYYYAAAAAHHHHHOOOOOOOO and a full schedule to boot - now that is magic (and one heck of a testiment to your professional rep!!!) congrats on a job well done! Link to comment Share on other sites More sharing options...
xxbowiexx Posted June 1, 2011 Share Posted June 1, 2011 congrats for passing through a HUGE huddle. I wish you the best of luck and please keep us inform of your trials/tribulations...and victories Link to comment Share on other sites More sharing options...
Magicnubs Posted June 1, 2011 Share Posted June 1, 2011 Congratulations J! Thanks for keeping us caught up on this. I've been following your updates for a while and it's been illuminating. Link to comment Share on other sites More sharing options...
jmj11 Posted June 2, 2011 Author Share Posted June 2, 2011 Opening day . . . can you believe it! One hell of a twisty road getting here. Link to comment Share on other sites More sharing options...
Moderator EMEDPA Posted June 2, 2011 Moderator Share Posted June 2, 2011 very proud of all you have accomplished. your web page looks great. I wish you all the best. I will try to make it up there at some point for a tour. Link to comment Share on other sites More sharing options...
andersenpa Posted June 2, 2011 Share Posted June 2, 2011 very proud of all you have accomplished. your web page looks great. I wish you all the best. I will try to make it up there at some point for a tour. PA Forum northwest field trip! Link to comment Share on other sites More sharing options...
jmj11 Posted June 2, 2011 Author Share Posted June 2, 2011 You are welcome. Indeed, all day long I have tour buses unloading from my doorstep to jump on the whale watching boat next door, or getting on a water taxi to venture out to the more remote islands. Had plenty of champagne to share today, too bad you weren't here. Link to comment Share on other sites More sharing options...
brookspa Posted June 4, 2011 Share Posted June 4, 2011 congrats.. may all your successes be enjoyed, fulfillment attained, dreams realized, and may you get a little rest now and then.. all the best to you and yours. Link to comment Share on other sites More sharing options...
jmj11 Posted June 4, 2011 Author Share Posted June 4, 2011 congrats.. may all your successes be enjoyed, fulfillment attained, dreams realized, and may you get a little rest now and then.. all the best to you and yours. That's nice of you Yeah, I've been sleeping like a baby for a week now. Link to comment Share on other sites More sharing options...
middimar Posted June 5, 2011 Share Posted June 5, 2011 i am currently a PA student and this may seem to be a rookie question, but don't you need a doctor on your staff to run a private office? Link to comment Share on other sites More sharing options...
rcdavis Posted June 5, 2011 Share Posted June 5, 2011 Mike has a supervising MD, whom he pays a stipend to. He is really trailblazing here. He has argued successfully the questions of " just whose patients are they.. The MD or the PA's?" Link to comment Share on other sites More sharing options...
dm123 Posted June 6, 2011 Share Posted June 6, 2011 It is really a great thing you are doing for the whole PA profession by opening up an option to be both a private business person and obtain rewards beyond a salary. Way to go!! Link to comment Share on other sites More sharing options...
jmj11 Posted June 6, 2011 Author Share Posted June 6, 2011 i am currently a PA student and this may seem to be a rookie question, but don't you need a doctor on your staff to run a private office? Yes, I have an MD on staff. The big challenge is that we are pushing the envelop regarding the law. It took about three months of negotiations with the state to get permission. The reason is, not only is the MD an employee of mine, but he lives in another city about 28 miles away, and will only see patients in his city twice a month. This has created numerous challenges with not only the state but the mal practice insurer, and the list goes on. I'm thankful that I'm in Washington state as I don't think I could have pulled this off in many other states. Link to comment Share on other sites More sharing options...
Beorp Posted June 6, 2011 Share Posted June 6, 2011 Yes, I have an MD on staff. The big challenge is that we are pushing the envelop regarding the law. It took about three months of negotiations with the state to get permission. The reason is, not only is the MD an employee of mine, but he lives in another city about 28 miles away, and will only see patients in his city twice a month. This has created numerous challenges with not only the state but the mal practice insurer, and the list goes on. I'm thankful that I'm in Washington state as I don't think I could have pulled this off in many other states. It is amazing what you have managed to do. How does that work the MD seeing patients twice a month? Does he have his own patient roster or is this more just that he is available to see patients twice a month so that the SP is practicing for the clinic? Link to comment Share on other sites More sharing options...
jmj11 Posted June 6, 2011 Author Share Posted June 6, 2011 This SP had his own headache clinic in that city (about one day a week) until he semi retired. He and I have shared patients over the years so we tend to know them both. It was when his patients started showing up on my doorstep, and I asked them what happened to him, and they told me he had retired . . . that I went to him, took him out to dinner and asked him if he would be interested in working for me. Part of it was a business angle knowing that if I was able to capture him, I would capture his patient panel. We will continue to share patients. They can choose who they want to see. They choose to see one of us on one visit and the other on the next. Link to comment Share on other sites More sharing options...
Beorp Posted June 6, 2011 Share Posted June 6, 2011 Very interesting! I'm glad it worked out so well! Link to comment Share on other sites More sharing options...
jmj11 Posted June 14, 2011 Author Share Posted June 14, 2011 I just went over our books, billings and etc. In my business plan, I had predicted that we would be solvent by our 5th month in business. The bankers did not believe that was possible (the problem of why would any patient choose to see a PA, in a PA-owned practice). I do not want to count my chickens before they hatch, but I am very pleased to announce that we were solvent our first week. Meaning, that our billings exceeded the needed billings that are required to sustain this practice (with an estimated collections of 63%). The near future, the next 4 weeks, are booked. But, this does not mean that there couldn't be a downturn coming in the future and I don't want to gloat too soon. The secret to our success is no doubt the fact that I had delivered good care in my area for the past 8 years. The bankers couldn't get their square heads around that fact. Link to comment Share on other sites More sharing options...
winterallsummer Posted June 14, 2011 Share Posted June 14, 2011 Wow man congratulations. I have been following your progress on the forum for some time. Not only is opening the succesful clinic a great accomplishment in and of itself, but you are a true leader for all PAs. Congratulations you definitely deserve it. Link to comment Share on other sites More sharing options...
GeneValgene Posted June 15, 2011 Share Posted June 15, 2011 I just went over our books, billings and etc. In my business plan, I had predicted that we would be solvent by our 5th month in business. The bankers did not believe that was possible (the problem of why would any patient choose to see a PA, in a PA-owned practice). I do not want to count my chickens before they hatch, but I am very pleased to announce that we were solvent our first week. Meaning, that our billings exceeded the needed billings that are required to sustain this practice (with an estimated collections of 63%). The near future, the next 4 weeks, are booked. But, this does not mean that their couldn't be a downturn coming in the future and I don't want to gloat too soon. The secret to our success is no doubt the fact that I had delivered good care in my area for the past 8 years. The bankers couldn't get their square heads around that fact. wow...that is so amazing! congratulations! Link to comment Share on other sites More sharing options...
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