You're ready to venture out and start your clinic in Texas, but medical practice funding still seems a mystery. What medical practice startup costs do you need funding for? How much does it cost to start a medical practice? You need answers to these questions before you can start figuring out how to get a loan to start your medical practice.
Here's what you need to know:
First, Evaluate Medical Practice Startup Costs
Any funding source wants to see that you're well aware of how much it actually costs to start your practice, but the good news is that medical practices are prime candidates for loans. They're low risk and generally profitable within 1-2 years.
Here are some practice startup costs you need to add up before pursuing a loan:
Acquiring/remodeling an office space
Licensing, fees and insurance
Furnishing, equipment, medical supplies & software
Website & marketing
Payroll and benefits
MGMA.org offers a more detailed checklist for medical practice startup for MGMA members.
Price these out, but know that how much it costs may surprise you. A new medical practice can expect to spend over $70,000 on startup in Texas. In urban areas, that cost will be higher. Write all of this out in your formal business plan.
Loans for Medical Practice Startups
When getting medical practice funding in Texas, you won't just head to the bank for a normal loan. You have many options. For a more comprehensive list, check out this article on how to get a loan to start your medical practice.
SBA 7(A) loans are insured by the Small Business Association. This helps you get better terms and increases likelihood of approval if your credit is less than stellar.
Non-bank term loans and short-term loans provide straightforward financing depending on your expected repayment schedule.
Equipment loans and business lines of credit have stricter requirements, but stronger benefits if you meet those requirements.
You can also go to the bank directly to get a medical practice business loan if you're a long-time customer of your bank.
Getting Medical Practice Funding
To obtain medical practice funding, you'll need to talk to each loan provider (bank or otherwise) to learn about options and requirements for different loan types. Because every practice is different, the best option for you may be different from what you find online.
If you’re still not sure where to start or where to go, contact an agency that’s experienced with medical practice startup & financing.
99MGMT helps physicians with practice startup (planning, funding, and more) as well as practice management once you get going. However, there are other agencies that only assist with the startup process if you want short-term assistance.
Want to know more about medical practice startup? Check out these articles:
How to Start a Medical Practice in Texas [CHECKLIST]
9 Tips on How to Select a Name for Your Medical Practice
7 Tips for Choosing the Perfect Medical Practice Location
How to Get a Loan to Start Your Medical Practice