How to Start a Medical Practice Checklist [+ Free PDF]
Launching a medical practice takes thorough planning and goes beyond simply setting up a physical location.
Effective planning is essential in establishing a medical practice, as it lays the groundwork for compliance, staffing, and other critical infrastructure.
Developing growth strategies from the onset will ensure the practice thrives and adapts in the competitive healthcare landscape.
Starting a medical practice from scratch is one of the most rewarding, and demanding, undertakings in healthcare. I’ve managed medical practices for years, and I can tell you that launching one involves a lot more than hanging a shingle. It requires planning, compliance, infrastructure, staffing, and growth strategies.
According to Doctorly.org, the estimated cost of starting a medical practice in 2020 was between $100,000 - $700,000. It's not a venture you want to take lightly. A lot of planning goes into starting your own practice, and if you do things right, you can become profitable in 6 months or less. That's a rapid turnaround for most business types.
My step-by-step guide outlines the essential steps to help new physicians or experienced providers transition into ownership with confidence.
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Step 1: Business Planning for a New Medical Practice
Let's break this step down further.
Define Your Medical Practice Goals and Services
Every successful private practice roadmap starts with a clear vision. Ask yourself: What kind of patients do I want to serve? Will I offer primary care or specialize in dermatology, psychiatry, or cardiology? Will I provide telehealth services or focus strictly on in-person care?
The answers to these questions will shape your staffing, equipment, and space needs. Defining your goals upfront also gives you a blueprint for operational decisions later.
Create a Medical Practice Business Plan
Your business plan doesn’t need to be fancy, but it should be detailed. I always include:
- Practice name
- Executive summary
- Market analysis and target demographics
- Service offerings
- Choose a practice model (eg. solo, partnership)
- Organizational structure
- Financial projections (startup costs, operating expenses, revenue estimates)
- Marketing plan
This practice start-up plan is essential when applying for financing or negotiating leases. It also keeps your team aligned.
Conduct a Medical Practice Risk Assessment
Before you invest a dime, evaluate your risks. That means looking at:
- Malpractice exposure
- HIPAA violations
- Cybersecurity threats
- Market saturation
- Revenue cycle challenges
A good practice operations risk assessment helps you plan for contingencies and choose the right insurance and legal protections.
Secure Medical Practice Financing
Unless you’re self-funding from your personal bank account, you’ll need capital. I've seen physicians use:
- SBA loans
- Bank lines of credit
- Equipment financing
- Private investors or partnerships
Prepare financial projections and a solid business plan to boost your odds of approval. Don’t forget to factor in working capital for at least 6–12 months.
Choose a Medical Office Location
The right location can make or break your practice. I look for:
- Proximity to your patient base
- Accessibility (parking, transit)
- Competition in the area
- Zoning and signage rules
I also recommend doing a site analysis to estimate foot traffic and visibility.
Step 2: Legal Requirements and Licensing
Let's break this step down further.
Obtain All Necessary Medical Licenses and Permits
This part isn’t optional. You’ll need:
- State medical license
- DEA registration
- CLIA waiver (if performing lab tests)
- Local business permits and possibly a Certificate of Occupancy
- Register for tax accounts
- Understand employment standards and regulations
These vary by state, so double-check your state medical board’s requirements.
Establish Credentialing with Insurance Providers
The credentialing process takes time; sometimes 90+ days. Start early and have all your documents ready:
- CV
- Malpractice history
- Licenses
- Board certifications
- NPI and Tax ID
I recommend outsourcing this to a credentialing specialist or using credentialing software to stay organized.
Review and Sign Health Insurance Contracts
Before signing payer contracts, read the fine print. Look at:
- Reimbursement rates
- Payment timelines
- Denial processes
- Fee schedules
It’s worth having a healthcare attorney review these agreements. Don’t just sign what’s handed to you, negotiate where you can.
Purchase Medical Malpractice Insurance
This is a must. Look for:
- Occurrence vs. claims-made policies
- Coverage limits (typically $1M/$3M)
- Tail coverage, especially if you change insurers or retire
Talk to a broker who specializes in insurance companies within your specialty to get tailored advice.
Step 3: Setting Up Your Medical Practice Infrastructure
Let's break this step down further.
Set Up Medical Office IT Systems and EMR
Your electronic health record (EHR) is your practice’s brain. Choose one that:
- Is ONC-certified
- Supports e-prescribing
- Integrates with labs and billing systems
- Offers patient portals
- Set up secure communication systems (email, phones, fax, patient messaging)
- Choose your practice management software and scheduling software
You’ll also need cloud backup and a firewall. I always budget for IT support from day one.
Best EHR Software Tools
Here are my recommendations for the best EHR software on the market right now.
Purchase Medical Equipment and Supplies
Make a medical supplies checklist based on your specialty. A primary care practice needs:
- Exam rooms and exam tables
- EKG machines
- Autoclaves
- Blood pressure monitors
- PPE and vaccines
Always compare vendors and ask about service contracts and warranty coverage.
Ensure Regulatory Compliance (HIPAA, OSHA, etc.)
This is where many new practices get burned. You need:
- HIPAA-compliant systems and privacy protocols
- Healthcare compliance software
- OSHA safety plans and MSDS sheets
- Infection control procedures
- Training logs and documentation
- Understanding of medical billing compliance
I do a mock audit before opening to catch gaps. A compliance consultant can save you serious fines down the line.
Step 4: Staffing and Internal Operations
Let's break this step down further.
Hire Medical and Administrative Staff
Start crafting your best healthcare job descriptions. At a minimum, you'll need:
- Medical assistants or nurses
- Front desk staff
- Biller or revenue cycle manager
- Office manager (or yourself, at first)
Check state rules for supervision ratios and scope of practice. Culture fit is as important as credentials.
Develop Medical Office Policies and Procedures
Clear policies = fewer problems. I always include:
- Scheduling and cancellation policies
- Patient intake and documentation standards
- Infection control
- Staff conduct and dress code
- Emergency procedures
These should go in an employee handbook and be reviewed annually.
Plan Staff Training and Continuing Education
Medical practice training shouldn’t stop at onboarding. Invest in:
- HIPAA and OSHA annual refreshers
- Customer service training
- Medical records handling
- Medicare and Medicaid compliance
- Clinical updates for your specialty
- EHR workflow training
It keeps your staff sharp and reduces turnover.
Step 5: Marketing and Practice Growth Strategies
Let's break this step down further.
Build Patient Referral Networks and Local Partnerships
Word of mouth still drives a ton of traffic when it comes to earning new patients. I reach out to:
- Nearby PCPs or specialists
- Community health organizations
- School nurses and coaches (for pediatrics)
- Local employers (for occupational health)
A simple flyer and lunch-and-learn can go a long way.
Launch a Medical Practice Marketing Strategy
Online presence is non-negotiable. Your medical practice marketing plan should include:
- Website with booking capabilities
- Google Business Profile
- SEO and local keywords
- Patient reviews and reputation management
- Social media (if relevant to your patient base)
Consider PPC ads in the beginning, then build organic traffic over time.
Implement Quality Improvement and Patient Satisfaction Measures
Growth comes from excellence. I track:
- No-show rates
- Wait times
- Patient satisfaction surveys
- Clinical outcomes (based on specialty)
Use this data to improve workflows, train staff, and differentiate your practice.
You can download a PDF copy of my how to start a medical practice checklist here.
5 Things I Wish Someone Had Told Me Before Starting My Own Medical Practice
Steal this advice; learn from my experience and mistakes!
1. Vision really matters
3 years into the running of the clinic and I'm still referring to the ideas and culture we dreamt up before the business began. It really does set us apart from other clinics and helps on every level; from recruitment to making those tricky quick decisions. Your vision will be your constant guide and reference point.
2. You'll wear more hats than you thought possible
In the beginning, you can expect to be part CEO, part HR, part accounts, part marketer, part IT support. I learnt pretty early on that it really pays to know your limits. Understand your own personal strengths and weaknesses so you know which of these to outsource.
3. Hiring the right staff is harder than you expect
Nothing changes a business more than the people within it, no matter how junior the position might be. There is nothing more draining than a bad hire, so it's important to slow down and invest to do this well.
4. Avoid shortcuts. They will always come back to haunt you
In those early days, with decisions needing to be made thick and fast, it was too easy to take shortcuts; skim reading important documentation, for example. But my experience is that these things have a habit of catching up with you in the end.
If you need to, slow things down, to understand the details of what you are doing. Read widely, take on board expert advice, and learn from others’ mistakes.
5. Cash flow! Cash flow! Cash flow!
Having a budget is one thing. Understanding the timings of your budget and when to make big purchases is another! We barely scraped through in our first year as cash flowed out of our account thick and fast and well before we had the time to recoup much of it.
FAQs About Starting a Medical Practice
Here are some questions people also ask me about how to start a medical practice, or medical practice management more generally:
How much money do I need to start a practice?
Startup costs range from $70K to $300K, depending on location, size, and specialty. Always budget extra for working capital.
How long does it take to start a medical practice?
Anywhere from 6 months to a year. Credentialing, licensing, and lease negotiations often take the longest.
Can I open a practice without hiring staff?
Technically yes, especially if you’re starting very small or using a virtual model. But most practices benefit from at least one admin and one clinical support person.
Is it better to rent or buy medical office space?
Renting offers flexibility, but buying can be a good investment if you’re sure of your long-term location. Startups usually rent first.
More Resources
Starting a new medical practice is hard. Here are some resources I recommend for all medical practice managers:
- Read books about starting a medical practice and learn from different experts, with different perspectives
- Listen to practice management podcasts on your commute to work each day to keep up with industry trends and new ideas
- Signing up for a few healthcare newsletters is another great way to ensure you get weekly tips and tricks served up to you reliably
- Take a healthcare marketing course so you understand how to promote your new business and get your name out there
- Consider attending a healthcare leadership conference to make connections and network globally
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