How to open a medical or dental practice
Seven stages from idea to opening day for a practice, with the federal steps linked and the state and local steps explained.
Concept and numbers
Test the idea and the budget before you commit.
Draft your startup budget and break-even
Use your own numbers to see how much you need and what sales cover your costs. Revisit it as quotes come in.
Check that your name is available
Search your state’s business name records and the free federal trademark search before you print signs. This is research, not legal clearance for your practice’s name.
Talk to a free small business adviser
Small Business Development Centers and SCORE mentors offer free or low-cost counseling near you, including help with plans, budgets and local requirements.
Business setup
Register the business and its taxes.
Choose your business structure
Sole proprietorships, LLCs, corporations and partnerships differ in liability and taxes. The SBA’s guide compares them; an accountant or lawyer can help you decide.
Register your business with your state
LLCs, corporations, partnerships and nonprofits register with the state where they do business, and need a registered agent in that state. Sole proprietors may not need to register.
If you’ll use a different name, register it
A “doing business as” name is registered with your state, county or city, depending on where you are.
Get a federal EIN if you need one
An EIN is needed if you hire employees or operate as a corporation or partnership. It is free from the IRS; be wary of sites that charge for one.
Register for state taxes
Your state’s revenue department tells you which tax accounts you need, such as any state taxes that apply to your practice. Some cities and counties have their own taxes too.
Ask about a city or county business license
Many cities and counties require a general business license or registration in addition to state licenses. Ask your city or county business licensing office.
Your site
Find a location where your business is allowed.
Confirm zoning allows a practice at the address
Zoning can restrict or ban some kinds of businesses in an area. Check with your city’s planning or zoning office before you sign a lease.
Review your lease or ownership papers
Make sure the lease allows your use, and check who pays for build-out and required upgrades. Consider having a professional review it; OpeningIQ can’t give legal advice.
Plan for accessibility
Businesses open to the public must follow the ADA. New construction and alterations must be accessible, and barriers in existing spaces must be removed where that’s readily achievable. Small businesses may qualify for a tax credit.
Plans, permits and build-out
Get the approvals to build out and prepare the space.
If you’re renovating, get building permits
Build-outs and renovations generally need permits from your city or county building department, and some need plan review first. Ask before work starts.
Ask whether you need a certificate of occupancy
Many places require a certificate of occupancy, or a similar approval, before a new tenant or a new use opens. Your building department can tell you.
Ask the fire department about inspections
Ask your local fire department or fire marshal whether your space needs an inspection or permit before you open, for example for occupancy limits and exits.
If you’ll put up an exterior sign
Ask your city or county whether your sign needs a permit before you order it.
Licenses
Get the licenses that let you open.
Confirm every clinician is licensed in your state
Physicians, dentists, nurses and other clinicians need licenses from the state where they practice. Check with your state’s medical, dental or nursing board.
Ask whether the practice needs a state facility license
Some practice types, such as ambulatory surgery centers, need a license from the state health department, and some states require approval before certain facilities open. Ask before you commit to a site.
Get NPIs for the practice and each clinician
Health care providers apply for a free National Provider Identifier through NPPES. The practice and each individual clinician have their own.
If you’ll handle controlled substances, register with DEA
Practitioners need state authority first, and a separate DEA registration for each principal place of practice where controlled substances are handled.
If you’ll run lab tests, get a CLIA certificate
Testing human specimens, including simple tests, needs a CLIA certificate. Apply with form CMS-116 through your state agency.
If you’ll bill Medicare, enroll in PECOS
Get your NPI first, then enroll through PECOS, Medicare’s online enrollment system. An application fee may apply.
Start insurance credentialing early
Credentialing with Medicaid and private insurers takes time. Start once you have your NPIs and licenses.
Get ready to open
Cover people, insurance and suppliers.
Set up HIPAA privacy and security
Providers that bill or share health information electronically, such as doctors, dentists and clinics, are HIPAA covered entities and must protect patient information.
If you’ll hire, register as an employer with your state
States run unemployment insurance tax, and states with an income tax also require withholding. Your state’s labor and revenue departments set up employer accounts.
If you’ll hire, set up federal payroll taxes
Withhold federal income tax using each employee’s Form W-4, pay Social Security and Medicare taxes, and pay federal unemployment (FUTA) tax, which isn’t withheld from pay.
Complete Form I-9 for every hire
Employers verify each new employee’s identity and authorization to work on Form I-9 and keep it on file.
Report new hires to your state
Report each new employee to your state’s new hire directory within 20 days of hiring; some states require it sooner.
Get workers’ compensation insurance
Most states require workers’ compensation insurance once you have employees, and the rules vary by state.
Put up required workplace posters
Which federal posters you need depends on the laws that cover you; the Labor Department’s free Poster Advisor tells you. States have their own posters too.
Set up an exposure control plan
If staff could be exposed to blood or other infectious material, OSHA requires an exposure control plan with protective equipment, training and hepatitis B vaccination.
Arrange business insurance
Ask an insurance broker what coverage your lease, lender and licenses call for, including professional liability (malpractice) coverage. This is an OpeningIQ suggestion, not an agency requirement.
Line up equipment, records software and suppliers
Choose practice-management and records software that supports privacy and billing needs. Get quotes early; your budget should guide the choices.
Check every approval is in hand
Gather your licenses, NPIs, registrations and certificate of occupancy in one place, and confirm each matches your address and business name.
Open and stay current
Keep licenses, permits and filings current.
Keep licenses and registrations current
Put every renewal on your calendar, including state licenses, DEA and CLIA if you have them, and keep your NPPES and enrollment records up to date when anything changes.
Track these steps in a free private plan
Save your progress, notes and target dates, and see your next step at a glance. Your plan stays private and is never shared with suppliers.