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Starting a practice

How to start a group therapy practice

Pivoting to a group-based model can give you the opportunity to help more clients, gain a sense of community, and even earn more money.

For some therapists, the business side of private practice feels like a necessary evil. Others realize they’re good at, and even enjoy, the entrepreneurial component of owning a therapy practice. If that’s the case for you, you may want to consider expanding your business by opening your very own group practice. 

There are lots of good reasons to pivot from solo practice to a group-based model, including the opportunity to help more clients, gain a sense of community, and even earn more money. But as with any business venture, you’ll want to make sure you understand the responsibilities and steps required to start a group therapy practice. 

Below, learn more about what the pros and cons of a group therapy practice, and what it takes to open one, according to a group therapy practice consultant.

Benefits of running a group practice

Running a group practice can be beneficial to you (and the people you’re helping) for several reasons. 

“As a solo therapist, you may have to turn away clients,” says Matthew Evans, owner of the Texas-based group practice Starlight and a group practice consultant. “In a group practice, you can keep referrals in-house as you bring clinicians on.” 

Community is another major perk of working with other clinicians. Solo practice can be lonely, and you may miss opportunities to mentor other therapists, get advice on your cases, and build relationships with people who can empathize with the highs and lows of the mental health profession.

“Sharing expertise also helps you and your clinicians build new skills as providers,” says Evans. “Someone who is brand new in the industry can learn from someone with much more experience.” 

Lastly, a group practice can also be financially beneficial (but Evans notes this part can take time). Business models for group therapy practices vary, but your earning potential can eventually grow if you’re earning money from more therapy sessions than just your own.

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Responsibilities of a group practice owner

As the owner of a group therapy practice, you’ll inevitably have more responsibility than if you’re working in a practice by yourself. Rather than working on your own and managing only your caseload, you’ll be tasked with managing a team of people who ultimately represent your practice. 

Your exact responsibilities ultimately depend on the model of your practice, explains Evans. 

If you hire clinicians as W2 employees, then you’ll be responsible for all the components of hiring and managing employees, such as human resources, payroll, and benefits. These are important decisions that you should discuss with your legal and accounting advisors.

You’ll also need to decide whether you’ll be responsible for marketing and finding clients, or if that responsibility will fall on your therapists.

Evans adopted a model in which he handles marketing, filling and managing his therapists’ caseloads through Headway. “We take away the administrative burden so therapists can focus on being therapists,” he says. 

As an owner, you’ll also want to ensure that your providers are operating compliantly, and billing and documenting their care appropriately: If a group’s employees or contractors commit fraud, waste, and abuse violations, the owner could be held liable.

How much does a group therapy practice owner make?

As a group therapy practice owner, there is the potential for you to eventually make more money. Evans says the first year or two of a group practice is usually less financially stable, but as you hire clinicians, you may be able to draw in an extra $30,000 to $40,000 (for example) in additional income each year.


Exactly how much you earn will depend on factors such as the number of therapists in the practice and the structure of your business — and, of course, how well you manage said business. 


Earning potential is also dependent on whether you continue seeing your own clients, but Evans emphasizes there are pros and cons to this setup. You can possibly make more money if you continue therapeutic work, but you may also lose sight of important business practices essential for stable passive income. 

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Tips for starting a group practice

Specific steps for starting a group practice vary depending on your state, licensing body, and the type of therapists you’re bringing on. But in some ways, Evans says the process is similar to starting an individual practice.

1. Make a business plan

You’ll need to consider business steps like obtaining a business license, managing your finances, marketing and networking. 

2. Select the right business entity

As for your business entity, if you’re employing other people, you’ll need to structure your business as a corporation rather than a sole proprietorship. Every state is different, but Evans recommends choosing an entity that protects you from liability.

“As a group practice owner, your license, income, and reputation are attached to what your team does, so there’s more risk involved,” he says. (To that end, as in a private practice, you’ll definitely need liability insurance as a group practice owner.) 

3. Decide how to structure your business.

It’s also important to decide how you want to structure your business (for example, if you want to hire employees or contractors), and how you’ll handle marketing (whether you’ll manage it or if the therapists will be responsible for finding their own clients). 

4. Consider your ideal caseload

You’ll also need to carefully consider whether you’ll continue seeing the same number of clients, if you’ll see fewer clients, or if you’d like to focus on running the business and supporting your team of clinicians.

“It can be difficult to work with a full schedule while expanding into a group practice, so you’ll need to decide if you’ll cut back on that work,” says Evans. “Everyone has a different level they can tolerate as far as the mental load that goes into the work.”

At the end of the day, starting a group practice involves a lot of trial and error. Hiring exports like an attorney and tax accountant can help ensure you set up and run your business effectively.

For extra support, consider leaning on a therapist who’s done it before — or working with a group practice consultant who can guide you in the ins and outs of setting up your business and managing other therapists. 

Start a group practice with Headway for quicker credentialing, competitive rates, and easy client verification.

Talk to a practice consultant

Starting a practice