From Idea to Reality: Quick Steps for Launching Your Allied Health Practice

Are you a skilled allied health professional contemplating the leap to launch your own practice?

Most practitioners in an allied health field such as physiotherapy, chiropractic, optometry, dietetics, speech therapy, podiatry, occupational therapy, or veterinary medicine eventually want to strike out on their own.

Even if you're an expert in your field, navigating the complexities of starting your own business can be daunting. You may not know if you should be trading as a company, or what a family trust is, let alone organising insurances and GST. 

This guide aims to simplify the startup process, providing essential insights for allied health practitioners.

1.     Business structure

When launching your allied health practice, one of your earliest and most crucial decisions is selecting the right business structure. 

Related: 
Why is your business structure an essential aspect of your medical practice?

There are four primary options to consider, each with its advantages and disadvantages:

 Sole Trader: You and you alone

Advantages: Low cost to set up, direct control over all business decisions and operations.
Considerations: 

• Limited Personal Protection: As a sole trader, your personal assets are not shielded from business liabilities. In the event of financial difficulties, you are personally responsible for business debts.
• Tax Implications: Profits are taxed at your individual tax rate, which can vary depending on your total income.

Partnership: You and a like-minded practitioner

Advantages: Collaborative approach, sharing responsibilities and decision-making. Generally no or low cost to establish, making it accessible for small practices.
Considerations:

• Shared Risk: Like sole traders, partners have unlimited personal liability for the business's debts and obligations.
• Tax Implications: Profits are shared and taxed at individual tax rates, which may vary depending on each partner's income. 

Trust

 Advantages: Offers a level of personal asset protection by separating business and personal assets. Provides opportunities for strategic tax planning, allowing for more tax-efficient profit distributions among beneficiaries.
Considerations:

• Setup Costs: Setting up a trust can involve low-medium initial expenses.
• Complexity: Trusts may require careful planning and management

Company

Advantages: Provides the highest level of personal legal protection as the company is a separate legal entity. Taxed at a flat rate of 25%, which can be advantageous for some practices.
Considerations:

• Higher Setup Costs: Establishing a company typically involves higher initial costs.
• Compliance: Companies must comply with additional regulatory and reporting requirements.

The choice of business structure should align with your practice's size, goals and risk tolerance. It's advisable to seek professional advice from an accountant or legal expert when making this critical decision. Your selection will significantly impact your financial and legal responsibilities as you embark on your journey to build a successful allied health practice.

2.     Market research, location, facilities

Identify target customers and clientele: Begin by conducting thorough market research to identify your target customer base. Consider whether you want to serve a broad range of patients or if your expertise aligns better with a specific niche within your field.

Choosing the right location: 

• Does your practice need to be in a specific area to effectively reach your target clientele?
• Is your location easily accessible to patients, considering parking, public transport and disabled access?
• Proximity to hospitals, clinics or other healthcare providers can be advantageous for referrals.

Specialised facilities and equipment:

Depending on your allied health specialty, you may require specialised facilities or equipment. Consider:
Medical waste management: If your practice involves medical procedures that generate waste, ensure you have proper protocols and facilities in place for disposal.
Diagnostic equipment: Assess if your practice requires specialised diagnostic equipment and whether leasing or purchasing is more cost-effective.
Patient comfort: Consider the design and layout of your facilities to ensure the comfort and well-being of your patients.

Effective planning in these areas will not only help you meet the needs of your patients but also position your practice for success in a competitive healthcare landscape. By conducting comprehensive market research and selecting the right location and facilities, you'll be better equipped to deliver high-quality care and attract a loyal patient base.

3.      Financial management

Establishing sound financial practices is a cornerstone of building a successful allied health practice. Here are key steps to ensure your practice's fiscal health:

 Reliable bookkeeping system: Set up a reliable and easy to use bookkeeping system that will track your income and expenditure and allow you to easily prepare your Business Activity Statements.

Compensation: Determine how much the business will need to pay you, and if this will be a wage, profit distribution, or a combination of both.

Cashflow budget: Create a basic cashflow budget. Your cashflow budget should be a dynamic document that evolves as your practice grows. Regularly review and reflect on your budget, making adjustments as necessary to accommodate changes in patient volume, expenses or unforeseen circumstances.

Related:
Payroll tax risks to medical practices and allied health providers

 By implementing these practices, you'll be better prepared to navigate the financial complexities of running your business and adapt to its evolving needs.

4.      Patient records and data security

Maintaining the privacy and security of patient records is not only a legal obligation but also a fundamental trust-building aspect of your allied health practice. Here's how to ensure the confidentiality and safety of sensitive data:

• Ensure  that all sensitive patient records are securely stored and protected from unauthorised access..
• Educate your team on privacy and data security protocols - all staff members should understand the importance of confidentiality and their role in maintaining it. 
• Prioritise cybersecurity for digital records.  Restrict access levels for staff, contractors, and patients to prevent data breaches. This includes the use of strong passwords, encryption, and regular system updates.
•  Regularly educate your staff on data security and privacy best practices. As technology and threats evolve, keeping your team informed is vital to maintaining a strong defense against potential breaches.

5.      Marketing, networking & strategic partnerships

Successful marketing, effective networking, and strategic partnerships are pivotal to the growth and success of your allied health practice. Here's how to proactively enhance your practice's presence and reach:

Relationships with other service providers. Establish and nurture relationships with other service providers whose offerings complement your own. Such partnerships can lead to cross-referrals and a more comprehensive approach to patient care.

Let the world know that you’re in business and how to contact you. This could include:

• An online presence: Develop a professional website that highlights your services, expertise, and contact information. Your website serves as a central hub for patients to find you and learn about your practice.
• Local advertising: Invest in local advertising to ensure your community knows about your practice. Consider online advertising, social media promotion, and traditional methods like flyers or posters in local establishments.
• Word of mouth: Encourage satisfied patients to spread the word about your practice. Positive recommendations from existing patients can be one of the most powerful marketing tools.

Engage with your local business community: Introduce yourself to the local business community through organisations such as the chamber of commerce or special interest groups. These connections can lead to valuable opportunities for collaboration and networking.

Effective marketing and networking not only help your practice attract and retain patients but also position you as a trusted healthcare provider in your community. By building relationships, fostering connections, and actively promoting your practice, you can create a strong presence in the allied health sector and continue to expand your patient base.

6.      Licensing and regulation

Compliance with relevant regulations and licensing is fundamental for the smooth operation of your allied health practice.  Some of the things you will need to look at are:

Australia Health Practitioner Regulation Agency (AHPRA). Familiarise yourself with the regulations set forth by the AHPRA. These regulations govern the practice of health professionals, ensuring the highest standards of care and ethics.

Australian Securities and Investment Commission (ASIC). If your practice is structured as a company, be aware of the extra regulatory obligations imposed by ASIC. Compliance with ASIC requirements is vital for corporate practices.

Compliance for directors. Directors of companies must adhere to personal duties and responsibilities, which include acting in the best interests of the company and avoiding conflicts of interest.

The best advice to any new business owner is to seek advice and seek it early. Build a team of expert advisors to ensure the best chance of success, and the least amount of trial and error. 
 

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