How to Start Your Psychology Private Practice: A Checklist

Start Psychology Practice

Starting a private practice is like embarking on a new adventure; you aren’t sure exactly where this adventure will take you, but you know you’ll encounter new challenges, find new resources, and have brand new experiences.

Whether you are a travel junkie, a homebody, or something in between, you probably know that there is a key aspect to smooth adventuring: preparation and planning. It’s true for establishing a new business, and for branching out into private practice. You don’t need plan all the details out for a successful venture, but having a few of the big things figured out ahead of time will make the journey a lot smoother.

Before you get started, we recommend trialing our professional private practice software for 30 days at just $1.

Quenza’s user-friendly digital therapy tools will help you share unique, effective e-mental health solutions with those you help, and enhance the positive impacts of your therapy for even better client results.

What Qualifications & Licenses Do You Need?

This is a very basic first step, but it’s vital! You can’t start a private practice without the necessary qualifications to provide psychological services to your clients.

It may vary depending on where you live, but in general, you will need at least a master’s degree in psychology or a related field in order to work with clients or patients. There are several majors or areas of concentration to choose from, including social work, school psychology, clinical psychology, and many more.

If you are interested in starting a psychology practice, in particular, you’ll probably want to go the psychology major route. Once you have your bachelor’s in psychology, you can move on to getting a master’s or a Ph.D. in psychology. Once you have the necessary degrees under your belt, you’ll need to complete an internship and, finally, apply for licensure in your state, territory, or country.[1]

Moving from the world of employment to independent practice can be scary and confusing, but also very rewarding. You’ll need to do a lot of research, tons of planning, and prepare yourself for even more paperwork.

Starting Your Psychology Private Practice

If you’re already familiar with the licensure and qualifications necessary to practice as a psychologist, but you’re wondering how to go about starting your own private practice, you can jump in here.

Moving from the world of employment to independent practice can be scary and confusing, but also very rewarding. You’ll need to do a lot of research, tons of planning, and prepare yourself for even more paperwork.

Let’s start with a simple checklist.

How To Start Your Mental Health Practice: A Checklist

Once you have the very basics figured out (e.g., education, license, any other necessary qualifications), you’re ready to begin planning out your practice.

Here’s a handy checklist to help you get started:

  • Have a business plan in place
  • Designate your workspace
  • Outline your practice’s policies
  • Check out insurance provider panels
  • Choose your private practice software/platform tool(s)
  • Build your paperwork library
  • Market your practice

Making A Business Plan: 2 Examples

You might not think you need a business plan as a helping professional, but it’s highly recommended that you create one. It can’t hurt to have one in place, and it will act as a helpful guide as you establish your business and get it up and running.

When drafting your business plan, make it as detailed as possible. It needs to cover the basics: what your business does, how it does it, and why it does it.

Recommended: Business Coaching: What It Is, Who Needs It, & How It Works

Nothing in your business plan is set in stone—after all, you can always update your plan to suit the reality of your practice—but it should be a detailed, in-depth resource on how you intend to run your practice.

Private Practice Business Plan Template

Your plan should include:

  • How much money you need to make each year to keep practicing.
  • How much you need to bring in each year to live the life you want.
  • Financial goals (e.g., earning enough to rent a better office space or hire a second therapist).
  • Your marketing plan.
  • Goals for the first months, first year, and first 5 years. This enables you to track your progress and assess whether your plans are realistic as you hit various benchmarks.
  • Funding options (e.g., your own personal savings, potential investors, loans).
  • A loan repayment plan (if you need a loan).[2]

Example Business Plan: Psychology Private Practice

The Business Plan Shop offers a great example of a practical outline for a straightforward but comprehensive business plan.

Not all sections may apply to you, but it offers a good template:

  1. Executive Summary (e.g., business overview, market overview, financial highlights)
  2. Company (e.g., structure, history, location)
  3. Products and Services
  4. Market Analysis (e.g., demographics, market need, regulation)
  5. Strategy (e.g., pricing, marketing plan, milestones)
  6. Operations (e.g., personnel plan, key assets, and IP)
  7. Financial Plan (e.g., start-up funding, assumptions, forecast)
  8. Appendix[3]

If the idea of a one-page business plan sounds good to you, Power Diary also offers some examples to help you craft your short and sweet, actionable business plan.[4]

9 Best Practice Management Software Systems to Use

When you have a business plan in place, a designated space for your practice, and some policies and procedures lined up, you have one important step to go before you can start marketing and taking on clients: you need to choose a practice management software.

Good practice management software will make your life in private practice much easier.

It should be able to help you with some of the most important but cumbersome parts of running your practice: creating and administering treatment plans, bringing new clients on board, invoicing and billing, documentation, scheduling, and more.

Fortunately, you have tons of options to choose from. There are a wide variety of software solutions that can help you manage your practice, and they offer an even wider variety of features.

Nine of the best solutions currently available are outlined below, but there are many more options a quick web search away.

SolutionDetails
Power Diary Psychology Private PracticePower Diary includes features like:

  • Customizable appointment scheduling and management (individual, group, and personal)
  • SMS and email reminders
  • Secure, HIPAA compliant telehealth video calls
  • Online paperwork (intake forms, consent forms, etc.)
  • Client records management
  • Clinical notes
  • Online invoicing and payments
  • Integrated payments and invoices
NamePower Diary
Price$5 – $60/week
Good ForCoaching Management, Practice Management, Physical Therapists, Occupational Therapists, Speech Therapists, Mental Health Coaches, Wellness Coaches, Business Coaches, Counselors, Teletherapists, E-counselors, Online Coaches
Websitehttps://www.powerdiary.com/
SolutionDetails
Simple Practice Psychology Private PracticeSimple Practice includes features like:

  • HIPAA compliant video appointments, including screen-sharing
  • Secure client portal for communication
  • Scheduling (including free, customizable appointment reminders)
  • Intake and documentation functionality
  • Billing, credit card processing, and autopsy
  • Insurance claim filing features (for both primary and secondary claims)
  • Complementary mobile app (iPhone and Android)
NameSimple Practice
Price$39 – $59/month
Good ForCoaching Management, Practice Management, Digital Health, Telehealth, Telepsychology, E-Mental Health
Websitehttps://simplepractice.com/
SolutionDetails
Quenza Psychology Private PracticeQuenza includes features like:

  • Drag-and-drop menu of pre-made and customizable activities (including education, exercises, intake forms, reflection prompts, and more)
  • Real-time client progress monitoring and results
  • Assessments, surveys, scales, and other measurement tools
  • Post-session feedback and evaluation
  • Ability to share multimedia resources (e.g., quotes, videos, PDFs)
  • Cross-platform solution with a supplementary client app
NameQuenza
Price$1/month and up
Good ForTreatment Planning, Care Management Software, E-Psychology, E-Therapy, Online Coaching, Therapists, Psychiatrists, Counselors, Telepsychiatry, Teletherapy
Websitehttps://quenza.com/
SolutionDetails
TherapyNotes Psychology Private PracticeTherapyNotes includes features like:

  • Interactive calendars and integration with other calendars
  • Appointment scheduling and automated reminders
  • Billing, invoicing, and payment processing
  • Customizable client portal
  • Templates and customizable client notes
  • Can create and submit insurance claims
  • Secure videoconferencing
  • Secure messaging
NameTherapy Notes
Price$49 – $59/month
Good ForCoaching Management, Practice Management, Digital Health, Telehealth, Telepsychology, E-Mental Health, Mental Health Coaches, Wellness Coaches, Business Coaches, Counselors, Teletherapists, E-counselors, Online Coaches
Websitehttps://therapynotes.com/
SolutionDetails
Kareo Psychology Private PracticeKareo includes features like:

  • Online appointments and reminders
  • Invoicing and billing
  • Payment processing
  • Insurance collections tracking
  • Billing analytics
  • Online patient intake process
  • Collection of resources to improve your practice
NameKareo
Price$80/month and up
Good ForE-Therapy, Telehealth, Private Practice Software, Customer Relationship Management, Physical Therapists, Occupational Therapists, Speech Therapists, Mental Health Coaches, Wellness Coaches, Business Coaches, Counselors
Websitehttps://www.kareo.com/mental-health/
SolutionDetails
Coaching Loft Psychology Private PracticeSolution includes features like:

  • Central dashboard
  • Goals and objective setting and tracking
  • Synchronized appointment scheduling with other calendars
  • Automated and editable session logging
  • Library of over 500 coaching questions
  • Coachee notepad and session notepad
  • Secure internal messaging system
  • Coach, session, and program rating and feedback system
  • Invoicing and billing
NameCoaching Loft
PriceFree – $95/month
Good ForCoaching Management, Mental Health Coaches, Wellness Coaches, Business Coaches, Counselors, Practice Management, Teletherapists, E-counselors, Online Coaches
Websitehttps://www.coachingloft.com/
SolutionDetails
BestNotes Psychology Private PracticeSolution includes features like:

  • Built-in customer relationship management (including inquiries, referral sources, etc.)
  • EHR (customizable assessments, treatment plans, group notes, and note templates)
  • Outcome measure tracking
  • Patient portal with safe and secure information sharing
  • Patient calendar to track cancellations, no-shows, notes, and billing codes
  • HIPAA compliant telehealth
  • Medication management and e-prescribing
  • Human resources functionality (track employee files, emergency contacts, CEUs, employment applications, etc.)
  • No set-up fees
  • Unlimited data
NameBestNotes
Price$50/month and up
Good ForTherapy Notes, General Healthcare, Telepsychiatry, Physical Therapists, Occupational Therapists, Speech Therapists, Mental Health Coaches, Wellness Coaches, Business Coaches, Counselors
Websitehttps://bestnotes.com/
SolutionDetails
TheraNest Psychology Private PracticeTheraNest includes features like:

  • Appointment scheduling and reminders
  • Billing, payment processing, statements
  • Practice management reports and statistics
  • Client portal for scheduling, payments, cancellations, etc.
  • E-prescribing functionality
  • EMR/EHR
  • Custom forms and assessments
  • Secure provider-client messaging
NameTheraNest
Price$39/month and up
Good ForPractice Management, Physical Therapists, Mental Health Coaches, Wellness Coaches, Counselors, Teletherapists, E-counselors, Online Coaches
Websitehttps://theranest.com/
SolutionDetails
Therabill Psychology Private PracticeSolution includes features like:

  • Electronic claims submission
  • Appointment scheduling (syncs with other calendars) and reminders
  • Billing, invoicing, and payment processing
  • Customizable documentation templates
  • Secure messaging and faxing
  • Custom and automated reports
NameTherabill
Price$149/month and up
Good ForPractice Management, Physical Therapists, Mental Health Coaches, Wellness Coaches, Counselors, Teletherapists, E-counselors, Online Coaches
Websitehttps://www.therabill.com/

A Note on Opening A Group Practice

So you’re thinking about starting a group practice?

There are additional pros and cons to starting a group practice, aside from the pros and cons of starting an independent private practice. You get to share the burdens of running a business, but you also have increased risk and complexity as you add business partners.

Therapist Amanda Ruiz notes that you should be asking yourself six questions before opening a group practice:

  1. Should I start a group practice? (aka, why do I want to start a group practice, what do I hope to gain from it)
  2. Do I have a system in place?
  3. Should I write a business plan?
  4. Should the group specialize?
  5. Do I want to accept insurance?
  6. Should I hire IC vs. W-2?[5]

You should be able to provide firm answers to each of these questions before starting your group venture.

Make sure you give some thought as to why you want to add more providers to your practice, whether you have a solid system in place that can handle additional providers, and where you plan to go with your group practice.

6 Helpful Books About Starting a Private Practice

If you want a more in-depth guide to starting your psychology private practice, there are several books that may help.

Here are the top 6:

  1. Getting Started in Private Practice: The Complete Guide to Building Your Mental Health Practice by Chris E. Stout and Laurie Cope Grand
  2. How to Thrive in Counseling Private Practice: The Insider’s Guide to Starting and Growing a Therapy Business by Anthony Centore
  3. Book Yourself Solid by Michael Port
  4. Private Practice Essentials: Business Tools for Mental Health Professionals by Howard Baumgarten
  5. Be a Wealthy Therapist by Casey Truffo
  6. Starting Your Private Practice: A Step-by-Step Guide for Mental Health Counselors by Maryanne L. Duan

Final Thoughts

It can be nerve-wracking to start your own psychology private practice, but with a little forethought and some planning, you’ll be ready to open your (physical or virtual) doors and start changing lives, one client at a time.

Refer to the checklist in this piece to get started, and don’t forget to check out the many resources peppered throughout. There’s no such thing as being too prepared when it comes to establishing your own practice!

If your goal is to improve your clients’ mental health from your own private practice, our $1 Quenza trial will give you everything you need to get started.

Don’t forget to try our software for 30 days of unlimited access to all the tools that will help you share unique, effective treatments and streamline your patient experience, so that you can make a difference with professional blended care.

References

About the author

Courtney is currently working as a healthcare workforce researcher for the state of California and is a regular contributor to the Quenza blog. She has a passion for taking research findings and translating them into concise, actionable packages of information that anyone can understand and implement.

Leave a reply

Your email address will not be published.