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Starting a practice
3 things you need to start your own practice (and 3 things you don’t)
Here’s your starter kit for private practice, according to providers who’ve been there before.
If you don’t know where to begin when it comes to starting a mental health practice, you’re not alone.
“We all get trained to treat mental health conditions from a clinical standpoint,” says Andy Cruz, a private practice psychiatrist and medical director at Headway. “But we don't learn about billing and coding, and we don't learn about how we go out and market ourselves and get patients — all the practicalities that make it really hard to be a private provider.
While it’s certainly not easy to strike out on your own, it can be uncomplicated. There are really only a few must-have requirements to set up a practice with Headway. Everything else, from an office to a website to a business bank account, can come later — if you even need them at all.
Here’s your starter kit for private practice, according to providers who’ve been there before.
The only 3 things you need: NPI, CAQH, and malpractice insurance
As a fully licensed provider, there are only three things you need to start seeing patients in private practice:
- An NPI number: A National Provider Identifier (NPI) is a unique 10-digit code used to identify a health care practitioner throughout their career — sort of like a social security number for clinicians. Therapists need an NPI to practice, bill for services, and fully comply with HIPAA requirements.
- A CAQH account: The Council for Affordable Quality Healthcare (CAQH) is a nonprofit organization that aims to make the healthcare industry work better. Most commercial insurance plans use the information included in a provider’s CAQH account — such as proof of education and training — to complete their credentialing processes. You’ll need an NPI number to get a CAQH account.
- Malpractice insurance: In the unlikely event you’re sued by a client, malpractice insurance could save you from disastrous financial consequences and protect your professional license. You’ll likely need an NPI number to secure a policy.
Patient care is likely — and understandably — the first thing on your mind when setting up a private practice. But it’s equally important to make sure everything is squared away behind the scenes.
A private practice is, at the end of the day, a business. An NPI number and CAQH account ensure your business can function to its fullest extent, allowing you to not only see patients but also bill insurance providers for your services and properly complete transactions that involve the transfer of client data. Malpractice insurance, meanwhile, keeps your new business financially secure in the event of unexpected problems.
Those three requirements can get you set up with Headway, where you can get in-network with insurance quickly, and begin seeing patients in a matter of weeks.
What to know if you plan to accept insurance in your new practice
If you're worried about what it will take to work with insurance after going in-network, you're not alone. Billing insurance for therapy can be complicated.
“When I started in my private practice, I would send a bill, and the insurance company would be like: ‘you didn’t code this right.’ Because I don’t know how!” Andy says. “ It was so hard.”
For a while, Andy hired someone to handle his billing and coding, but acknowledges what a financial hit that was to his bottom line in those early days of starting his business.
“Those things cost money,” he says. “Having a service that can do all that for you instead is really invaluable as a provider. Now, I don't really worry about that stuff. I just focus on patients, which is what I always wanted to do."
Headway's provider portal — called Sigmund — allows you to easily submit and manage claims (and receive payments in just 2 weeks), plus our EHR offers templates to simplify the end-to-end insurance documentation process — giving you time back to focus on your patients.
3 things you don’t need before you start a private practice
At least not right away. Each of these things can be valuable for your business, but don’t need to be a blocker to get started.
1. An office
Yu Wang, a nurse practitioner, started her own practice in 2022 with Headway. Because she built her solo caseload from zero patients, it was a part-time gig — just one day a week — that she could comfortably run from home. Only now, one year later with a full-time schedule, is Yu considering finding an office space so she can see patients in person.
“At the beginning, I really don't think it's necessary, because everything can be virtual,” she says.
It’s true: The Covid era ushered in a “remarkable transition” to virtual care, according to RAND researchers in a recent study published in the the JAMA Health Forum, and even today, nearly 60% of Headway providers today run their practice from home.
2. A business bank account
There’s no requirement that you keep your business income in a separate business bank account. Providers on Headway receive guaranteed, biweekly payments for care they’ve provided that can be deposited into a personal account.
A business bank account is a good idea, though, if you’re not great with money. Yu maintains a separate bank account and credit card: “Otherwise, it just seems to get a little messy,” she says.
Andy, on the other hand, doesn’t keep a separate bank account for his psychiatry business, but acknowledges that he’s disciplined about habits like setting aside money for self-employed tax payments. In fact, talking to a tax professional during your first year in practice can be a good first financial step to avoid any surprises, and make sure you're prepared.
3. A personal website
Yu doesn’t see any point to having a professional website. She says that she’s filled her ideal caseload by sourcing patients from marketing her practice on sites like Headway, Psychology Today, and other specialized healthcare directories.
“At the beginning of last year, I was thinking about having my own website,” says Yu. “And it just seems like, number one, it costs a lot of money. And number two, it doesn’t seem like it’s necessary.”
Andy agrees. He started his practice with a website, but took it down about 6 months later because he was getting more patient referrals from other sources.
"I built it myself. I liked it. It was nice,” he says. “But once I filled up, which was very quick, I was like: Why do I have this website? I keep getting referrals and I can't take them. So I took it down. I think things like Psychology Today or getting referrals through friends and family are sufficient.”
Start your private practice journey with Headway.
One more thing you’ll need to start a thriving private practice? The right partner.
Headway is there to support you as you get your business up and running. Our comprehensive platform assists providers with all of the administrative work that goes into starting and building a private practice. We make it easy to get credentialed in as little as two weeks. And once you’re ready to start seeing clients, you can connect with them through Headway’s online provider directory, design and update their treatment plans using Headway’s templates, and bill for your services with assistance from Headway. It’s that simple — and all available at no cost to you.
Starting a practice
How much does psychotherapy cost?
Therapist Reviews: Headway vs Talkspace
Wondering what differentiates Headway and Talkspace? Let’s discuss their pros and cons so you can decide which is right for your practice.
Your guide to becoming an EAP provider
Learn how to become an EAP provider as a therapist and expand your practice. Discover the requirements, benefits, and step-by-step process to get started.