Mind the details when opening a practice

Practice Pointers. By Karen S. Schechter, AMNews contributor. Oct. 15, 2007.

PRACTICE POINTERS

Answers to questions about the business side of your practice

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Question: In starting a new practice, what are the potential pitfalls to watch out for?

Answer: In last month's column we discussed the timeline and general things to think about in starting a new practice. This is a follow-up -- a look at some of the nitty-gritty work that needs to be done to avoid pitfalls.

Whether you use a consultant or do it on your own, here are some tips that may make the startup process less painful and more productive in the long run.

First, make sure your advisers (attorney, accountant, consultant, banker) have health care experience, and in particular experience with medical practices. Ask for references to substantiate their understanding of your business. Use these advisers to evaluate lease agreements and managed care contracts, along with your buy-out agreement from the practice you are leaving.

Next, be aware of credentialing stumbling blocks.

Many physicians think that because they are participating in insurance plans in one practice their status will automatically transfer to the new practice. Whenever there is a change in status, such as a new tax identification number, change of address, etc., the plans must be notified.

This notification may result in one of three actions. One, the plan will update its database with the information and attach the provider ID number to the new tax identification number. Or the plan will send you a new contract to sign before updating their database. Lastly, the plan could require you to go through the credentialing process as if you were requesting participation for the first time.