How to Start a Private Practice: What to Set Up From Day One
If you're preparing to open your own private practice, you've probably already fielded a hundred opinions about what you need. The truth is, most of what's complicated about starting a practice comes down to having too many decisions about what to do and how to get started.
I've been running SoCal Child Psychology for years now, and I've helped a lot of therapists navigate the business side of building a practice. What I see most often is clinicians who are excellent at their clinical work but completely underwater when it comes to the operational setup. This blog post is for therapists just getting started, or for those who want to refine what they’ve already been doing for a while now.
1. Get Your Legal Basics in Order
Business structure
Most therapists in private practice set up as a sole proprietor or an LLC. Talk to a CPA or attorney who works with healthcare providers in your state. California, in particular, has specific rules about professional corporations for licensed clinicians that are important to consider.
NPI number
If you don't already have your Type 1 NPI number, get it now by applying for it online. Even if you don’t accept insurance, having a NPI number will be important for making sure that your clients can submit superbills if they would like to.
Malpractice insurance
Get coverage in place for yourself before seeing your first client. There are plenty of options online, although I’ve used CPH & Associates for mine.
2. Set Up a Business Bank Account
Keep your personal and business finances completely separate from day one. Open a business checking account, get a business credit card, and run all practice income and expenses through those accounts. This will make your taxes significantly easier and your finances much clearer as you grow.
I'd also recommend getting set up with accounting software early. You don't need anything complicated, but you do need a system and I find using Excel to be way too confusing for most therapists.
3. Choose Your Practice Management Software Before You See Anyone
This is the decision I see new therapists put off the longest, and it's the one that costs them the most time later. Your practice management platform is the operational hub of your entire practice. It handles scheduling, documentation, billing, client communication, and payments. I switched to Jane in 2024, and love using it to make my practice run easier.
Two features in particular stand out for therapists who are just getting started. Jane Payments means you can collect payment directly through the platform without needing a separate payment processor. It's integrated, it's simple, and it removes one more administrative task from your plate.
Jane's Online Booking is the other one. When someone finds you, they can see your real-time availability and book a consultation immediately, without waiting for you to respond to an email. For a new practice trying to build a caseload, that matters. People who are ready to start therapy tend to follow through when the barrier to booking is low. If they have to wait 48 hours to hear back from you, some of them won't.
Jane also has a genuinely helpful customer support team. As someone with ADHD running a growing practice, being able to reach a real person quickly when I have a question has made a real difference. That kind of support is especially valuable when you're learning a new system while also trying to see clients.
If you want to explore whether Jane is the right fit, you can book a demo here. And if you're ready to get started, use code CARRIE1MO for a one-month grace period on your new account.
4. Build Your Intake Process
Your intake process is the first clinical and operational impression you make on a new client. Have it set up before you start accepting referrals.
At a minimum, you need a consent for treatment, a client information form, a HIPAA notice of privacy practices, and a practice policies document that covers fees, cancellations, telehealth, and emergency procedures. If you're working with minors, you also need a consent from a parent or guardian and clarity on who can authorize treatment.
Use your practice management platform to send these intake forms automatically when a new client books an appointment with you. Getting paperwork out of the way before the first appointment means you can actually use that session for clinical work.
5. Get Clear on Your Fee Structure
Decide on your fee before you start seeing clients. When determining your fee for clients, I recommend starting with the number of hours you have capacity for each week, and the amount of income you need each month. Let’s say that you have the capacity to see 10 clients per week. If you charge $200 per session, that’s $2000 per week, and $8000 per month prior to expenses and taxes.
If you're accepting insurance, understand your reimbursement rates before you credential with each panel. Some panels simply don't reimburse at a rate that makes sense for the cost of running a practice in certain markets.
6. Track Referral Sources
Most new therapists build their referral base through a few key channels: Psychology Today and similar directories, a Google Business Profile, a website, and word of mouth from other providers in your community. From the very beginning, you should track where your clients are coming from and focus on nurturing those referral sources. Whenever a client starts working with you, make sure you get information on how they found you or who referred them.
Starting a private practice is genuinely exciting, and a dream for so many therapists who are looking to break out of working at an agency. It can also be overwhelming if you're trying to figure out every moving part at once, and when all the admin work has previously been done for you. The therapists I've seen build practices that actually sustain them are the ones who invest in the right systems early.
Ready to get your practice management sorted?
If you want to see how Jane works, book a demo here. Or if you're ready to jump in, use code CARRIE1MO for a one-month grace period on your new Jane account.