Whether you're a physician leaving employment, a nurse practitioner in a full practice state, a therapist or a physical therapist, the path to opening a practice follows the same sequence. Here it is, with the details that cause delays when they're missed.
1. Define your practice model
- Setting: clinic, telehealth-only or hybrid.
- Payment: insurance, cash-pay, membership (direct primary care) or a mix.
- Size: solo, or planned growth to more providers.
- Services: what you'll offer at launch and what comes later.
Each choice changes your startup costs, equipment, licensing and timeline.
2. Check the rules for your license type and state
Corporate practice of medicine rules, NP and PA practice authority, collaborative agreement requirements and facility licensing vary by state. Confirm what applies before forming your business.
3. Write a business plan and budget
Estimate visits per day, your payer mix and realistic reimbursement, then build a month-by-month cash flow that accounts for credentialing delays and claim payment time. Most practices need several months of operating expenses in reserve.
4. Set up the business
- Form your entity (often a professional corporation or PLLC).
- Get an EIN, open a business bank account and set up bookkeeping.
- Obtain a group NPI (Type 2) if you'll bill as a practice.
- Buy malpractice and general liability insurance.
- Register for state taxes and local business licenses.
5. Secure your location
For in-person practices, choose a location near your target patients with adequate parking and accessibility, and confirm zoning and occupancy permits. Your address is needed for credentialing, so this step can't wait too long.
6. Start credentialing
As soon as you have an NPI, address and malpractice coverage, begin CAQH and payer applications. See our credentialing guide for the details.
7. Licenses and registrations
Professional licenses in each state you'll serve, DEA and state controlled substance registrations if you prescribe (here's how they fit together), and a CLIA certificate for any in-office lab testing.
8. Choose and set up your systems
- EHR with templates for your specialty, e-prescribing and a patient portal
- Billing system and clearinghouse, with ERA and EFT enrollment
- Phones, scheduling and online booking
- HIPAA policies, a security risk analysis and business associate agreements
9. Staff the practice
Decide which roles you need in-house and which can be virtual, such as reception, billing and prior authorizations. Train everyone on your systems before opening.
10. Prepare to be found
Launch your website, Google Business Profile and directory profiles a few weeks before opening, and tell referral sources you're coming.
Specialty notes
- Behavioral health: credential with behavioral health networks, which are often separate from medical plans.
- Urgent care: plan for walk-in volume, X-ray and lab, and real-time eligibility checks.
- Physical therapy: check your state's direct access rules and payers' plan-of-care requirements.
- Pediatrics: consider Vaccines for Children program enrollment and Medicaid plans early.
- Surgical specialties: hospital or surgery center privileges take months.
How long does it take?
Three to six months is common. Telehealth and cash-pay practices can move faster; clinics with build-outs and heavy insurance mixes take longer.
Our Practice Startup Assistance package runs this whole sequence for providers of every specialty.
Frequently asked questions
How long does it take to start a medical practice?
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Commonly three to six months. Insurance credentialing and location build-out are usually the longest steps.
How much does it cost to start a medical practice?
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It varies widely by specialty and model. A telehealth practice can start with modest costs, while a clinic with equipment and a lease needs far more. Include a cash reserve for the months before insurance payments become steady.
What should I do first when starting a practice?
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Define your practice model and check your state's rules, then build a budget. Start credentialing as soon as you have an NPI, address and malpractice coverage.
How we can help
This article is general information for healthcare providers, not legal, billing or medical advice. Rules change; confirm current requirements with the relevant agency or payer. Last reviewed October 18, 2026.