Many physicians don’t know where to begin when starting their own practice. Finding and getting referred to the right professional team often is the best first step. Working with an attorney, certified public accountant (CPA), wealth management team and practice manager allows physicians to focus on their practice and patients.
“I don’t always have time to stop and think about the business or financial side of things,” says Fadi Salibi, MD, an infectious disease physician in Henderson, Nevada. “The right team can ensure that the proper steps are taken to set the practice up properly.”
Establish a robust business plan
Thinking through some worst-case scenarios is often helpful when taking the first steps in overall practice planning. Often the largest financial concerns that threaten a physician’s financial well-being are the potential for lawsuits, excess taxation or compromised cash flow. Most physicians will start with selection of a corporation that carries some limited liability characteristics.
Your legal counsel will help you choose the most appropriate corporate structure that fits your practice model and state of residence. Ideally, your attorney will go a step further and help you protect your personal wealth through trust planning and other strategies with your wealth manager/financial adviser. An insurance professional can work with you to properly insure your cash flow against risks of death and disability. A CPA should work alongside your attorney and wealth manager to help you decide how your corporation should be taxed.
“Having a great plan and a great team, I feel like I can diversify into other areas of business with the right support and feedback,” Salibi says. “Physicians should think about diversifying their cash flow and building a well-rounded investment portfolio.”