Psychiatry offers immense flexibility, especially when it comes to work-life balance. Many are drawn to psychiatry for precisely this reason, particularly in the virtual and private practice space.
We previously covered How to Set Up a Virtual Private Practice. However, the transition to private practice can be challenging for those in training. Here are the common mistakes to avoid as you start thinking about your future in virtual psychiatry.
Disclaimer: Please note that this guide is not intended as a substitute for professional legal or financial advice. When considering your own private practice, work closely with supervisors and financial professionals since every situation presents unique challenges.
1 | Not Understanding What It’s Like
One of the biggest mistakes future psychiatrists make is assuming their training reflects what they’ll encounter in private practice. Most psychiatry residency programs focus on inpatient work, which is very different from outpatient settings. Additionally, outpatient clinical exposure in academic training programs is quite different from the settings in which most psychiatrists work.
To prepare for private practice, ask the attendings you work with early on what it’s like to run or work in an outpatient or private setting. All perspectives can be helpful, whether they work in a cash-only, solo-practice, or a multispecialty outpatient group that takes insurance.
Each has its own set of challenges and rewards. Elective time can be another avenue to explore these less-academic settings. Essential questions to ask include how they manage overhead costs, billing, and patient scheduling. Their experience will help bridge the gap between your intensive training and future practice.
2 | Not Securing a Business Address or Domain Name Early On
The business side of medicine is often not emphasized in traditional medical education. In the private practice space, how patients find you, your accessibility, and patient perceptions matter—a lot.
One of the first things you’ll need is a business address, even if you plan to work from home. Most licensing boards, insurance companies, and regulatory forms require a physical business address; a P.O. box usually won’t cut it. It’s also important to think about domain names (for both your website and business email address) early on.
This may seem like a minor detail, but in psychiatry, it’s important. Due to the nature of our work, providing a home address can pose safety and therapeutic risks. It’s also vital to protect your privacy and safety—using your home address isn’t a great idea when it comes to patient boundaries and public visibility.
Additionally, failing to provide a proper business address can delay setting up your practice. Options include renting a small office space or using a virtual business address service. In areas where private practices are common, there are usually a number of flexible arrangements, such as renting out office space either hourly or at a daily rate.
This is where connecting with private practice attendings (during electives or through mentorship) can be additionally helpful. Alternatively, there are online and local resources that can assist with obtaining a physical workspace. Connecting with a local psychoanalytic training institute can be another source for referrals and other office support.
3 | Not Understanding IRS Rules
When it comes to the financial perks of working virtually, many are tempted by the idea of a home office deduction. The tax savings here can be broad, even helping to write off rent, utilities, and office supplies, but be careful! The IRS has strict rules on what qualifies as a home office, the main deduction for solo practices.
To qualify for the home office deduction, your office space must be used exclusively for business. Even a small corner of your apartment that you can use exclusively for patient visits and charting can qualify, but shared spaces, like the dining room table or a room you occasionally use for personal activities, won’t.
Failing to meet these guidelines could cause you to lose the deduction or face an audit. It can be worthwhile to consult with a tax professional to make sure you’re following the rules correctly.
4 | Not Building Your Network
Many residents underestimate how important their professional network will be when they start practicing independently. Running a private practice can be isolating, and having mentors, peers, and colleagues you can turn to is critical.
It’s important to start building this network while in training. Take advantage of opportunities like additional training through local psychoanalytic institutes or other therapy training organizations. Joining professional organizations and attending conferences, like the American Psychiatric Association, can also help you connect with like-minded professionals and build up your brand.
Residency provides a unique opportunity to potentially apply for funding to pursue these extracurriculars while also building your network through your co-residents, supervising attendings, and other mentors through your training program.
5 | Ignoring State Licensure Requirements for Telemedicine
Telemedicine has made starting a private practice as accessible as ever. Many trainees will even start small private practices during their training.
However, there are regional differences in the demand for private practice psychiatrists and how this exciting area of psychiatry is regulated. For example, each state has different licensure requirements for practicing telemedicine, which can be one of the trickiest aspects of operating a virtual private practice. Failing to understand and comply with these requirements properly could result in heavy fines, legal trouble, or even the loss of licensure.
Reviewing the specific licensure requirements for the states where your patients are located is critical. Some states offer temporary or expedited telemedicine licenses, while others require a full state licensure.
Additionally, each state may have different rules governing controlled substances, especially when it comes to prescribing virtually. The Interstate Medical Licensure Compact (IMLC) can be a helpful resource for psychiatrists looking to practice across multiple states; however, not all states participate, so it’s important to review your options early.
Related to state licensure is malpractice insurance. It’s essential to contact your malpractice carrier to ensure that telemedicine services are covered, especially while in training when your malpractice may only cover residency-related activities.
6 | Understanding the Technology You’ll Need
The technology infrastructure for a virtual psychiatry practice is another essential area to get right. Reliable, HIPAA-compliant technology is necessary for conducting telemedicine visits, maintaining patient records, and managing billing and scheduling. Getting these aspects in place on the front end is critical since changing them later can introduce new challenges.
Start by ensuring a secure, stable internet connection and an appropriate video platform compliant with HIPAA regulations. While many general-use video chat platforms (like Zoom or Google Meet) offer HIPAA-compliant versions, understanding any additional business associate agreement policies will be essential to ensure patient data is adequately protected.
It’s generally good practice not to use personal email or phone numbers for various reasons, including privacy concerns. Additionally, looking into electronic health record (EHR) systems that integrate well with virtual visits will be important. Some offer portal systems for simple communication, scheduling, billing, and charting.
Alternatively, different health insurance carriers may have different contract obligations for electronic services rendered, while cash-only practices do not have to abide by these standards. For example, while many states require electronic prescribing (e-prescribing) for all providers, electronic medical records may only be required for certain insurance carriers.
Your local American Psychiatric Association District Branch & State Association and mentors/supervisors can help you stay up-to-date with these regulatory details.
7 | Not Setting Boundaries Early
One of the biggest challenges in private practice psychiatry, particularly in virtual spaces, is maintaining appropriate boundaries with patients. This can be challenging for early career psychiatrists because formal processes and structures are self-defined.
Determining when you do what kind of work (patient care, calling pharmacies, charting, billing, etc.) is entirely based on your preferences and abilities. Deciding how much to charge is another complicated dynamic, as is navigating patients who do not pay promptly.
Closely related to this is determining how you will manage your vacations (the standard of care generally involves identifying a covering provider), how to navigate unsolicited collateral, and appropriately addressing ethical situations. These are all factors that are typically prescribed in training but are up to the operator to define in private practice.
The first step is creating practice guidelines, making them transparent for patients, and sticking to them as much as possible. There are many online guides and practice templates on privacy statements, confidentiality, and late cancellation/no-show policies.
A wise approach is to review these, discuss them with a supervisor and trusted colleague, and adapt them to your own situation. Setting these boundaries early will protect your personal life and foster a more professional therapeutic relationship.
Crafting a Career With Flexibility and Autonomy
Establishing a virtual private practice in psychiatry can be incredibly rewarding, offering flexibility and autonomy. However, it’s important to be aware of the numerous pitfalls and establish a professional network to navigate them.
From understanding the differences between training and private practice to ensuring compliance with state licensure and setting boundaries with patients, the transition requires thoughtful planning. Preparing early and seeking mentorship will be key to navigating these challenges and making the most out of your career.
If you are considering a career in private practice psychiatry, our team of dedicated Insiders can prepare you with everything you need to begin and excel at your training. We’d love to meet with you to hear your story, clarify your goals, and create a plan that supports you at any stage of your medical journey.
If you’re not sure yet, keep in mind that it’s natural not to be totally certain of the specialty you want to pursue. If you’re having trouble deciding or second-guessing yourself, check out our So You Want to Be playlist, which takes a deep dive into the pros, cons, and training steps for every medical specialty.
