The Pros and Cons of Starting a Private Therapy Practice

Working at desk with computer and papers, side viewMany therapists have dreams of one day starting their own private practice. Following through on these aspirations, however, requires taking a number of things into consideration.

There are definite pros and cons. Having worked as a therapist for a number of community organizations prior to having my own private practice, I can attest to the validity of both. Some of the issues to consider include:

Business Concerns

Starting a private practice requires exploring the laws in your city that apply to owning your own business. You will typically need to obtain a business license from the city you live in and renew it on a yearly basis.

Work Schedule

Owning your own business means having the freedom to limit the number of days and hours worked. However, you also need to be able to accommodate people when they are available to come in, which may require having to work evenings and/or weekends.


Being in private practice requires taking the steps necessary to generate business, which many therapists feel uncomfortable doing. Establishing a web presence is important in order to attract individuals looking for the specific services you offer, the therapeutic approaches you use, and any areas of expertise you may have. Effective ways of advertising include creating a practice website, writing a blog, and maintaining one or more professional profiles on online therapist directories such as All of these efforts take time and some financial investment.

Insurance Panels

Working with insurance companies can provide an ongoing stream of referrals and new business. Many individuals will contact only therapists who accept their insurance. In addition, many insurance companies will transfer payments electronically into the therapist’s bank account upon request, which can be quicker and easier than receiving checks in the mail and having to make trips to the bank. On the other hand, it can be a lengthy and difficult process becoming a provider for many of the insurance panels out there. The applications are often long and time-consuming to fill out, and they can take anywhere from three to four months to be processed. In some parts of the country, a number of insurance panels may already be saturated, making it difficult to join and limiting the number of individuals you are able to see. Reimbursement rates are also often quite a bit lower than many therapists’ typical rates, and it can often take up to 30 days to get reimbursed. If claims are not submitted in a timely manner and/or there are problems with the claims, this can also slow down the reimbursement process or even prevent the therapist from getting paid. Calling insurance companies to check on claims can also be tedious, as their call lines tend to be busy.


Going into private practice requires taking into consideration the overhead and other expenses that apply when one owns a business. Some of the expenses to account for include the need to lease office space; the cost of utilities; furnishing the space; marketing efforts; obtaining office supplies and business cards; and the price of medical, dental, and liability insurance. You will also need to decide whether to do your billing yourself, which can be time-consuming, or hire someone to do it for you. If you are just starting out, you may want to consider subletting an office on a part-time basis (for example, on weekends and/or one or two evenings a week) to start building your practice before quitting your full-time job.

Fluctuating Income

Although a private practice can be profitable, it can also be unpredictable at times. Whereas you are typically guaranteed a certain monthly income when working for an agency or organization, a private practice does not provide the same level of security. The number of individuals seen, as well as the income generated, tends to vary from month to month. It can also take time to build up sufficient business for you to live off of, and you have to set aside money for taxes and/or make quarterly estimated tax payments, as this will not be done for you. You also need to keep in mind you will not get paid for any time off, so you will need to have a cushion set aside in order to account for any vacation or sick time.

Going into private practice can be profitable and rewarding, but it can take a lot of time and energy before you get to that point. The risks associated with any type of business are not for everyone, but the dream of starting your own private practice can become a reality if you are willing to take a leap of faith and put in the work needed in order to succeed.

© Copyright 2016 All rights reserved. Permission to publish granted by Wendy Salazar, MFT, Topic Expert Contributor

The preceding article was solely written by the author named above. Any views and opinions expressed are not necessarily shared by Questions or concerns about the preceding article can be directed to the author or posted as a comment below.

  • Leave a Comment
  • Josh

    July 18th, 2016 at 9:40 AM

    There is not much in this world that compares to being your own boss

  • mary

    July 19th, 2016 at 7:13 AM

    It can be a challenge to get any kind of small business venture up and running so I imagine that the same thing might be true of a private therapy practice. You need patients and you have to beat the bush for referrals. I can see how for someone just starting out that this could be a little intimidating and that this might be why they would want to be in an established practice at first, to sort of build a patient base and to get to know others who could then refer out to them. I think that it is all a matter of what you are looking for. Know your own needs and I think that this could help point you toward which practice option would be right for you.

  • Judd M

    July 19th, 2016 at 2:00 PM

    One of the hardest things I would think about managing your own business is that you have to be willing and able to go with the flow, maybe a little bit more than you might have to be if you work for someone else.
    When you are employed by someone, you know that there will always be a paycheck. But if you work for yourself then sometimes you might have to make a hard decision that means less pay for you for that week or that month. Are you willing to be in the business and look at it for the long term or can you only focus on week by week? Those are some things that you have to ask yourself when you are thinking about going it alone.

  • Nan

    July 20th, 2016 at 6:57 AM

    The start up costs can often times be a deterrent as it can be quite overwhelming in the beginning.

  • patsy

    July 20th, 2016 at 1:18 PM

    If you can deal with the uncertainty a little bit I would say to go for it

  • Chuck

    July 23rd, 2016 at 9:12 AM

    I have been in business before for myself and I have worked for other people. It is all a matter of weighing the things that are most important to you. There can be a lot more responsibility that comes with owning and operating your own business, and you always have to be there or feel like you do to keep the place up and running. So it can be a little overwhelming. But at the same time it can be pretty rewarding too when you make something of it and make some progress and really feel like you are doing something good.

  • Allyson

    July 25th, 2016 at 5:15 PM

    I would definitely think that it would be a little easier to go into practice with another person… but more fulfilling to go it alone.

  • Braden

    December 27th, 2016 at 9:59 AM

    It’s interesting that there are so many benefits to running a private practice. It makes sense that people would want to use one! That means more personalized care.

  • Corinne

    March 4th, 2017 at 10:44 AM

    Curious if anyone has moved their mental health practice into their home? Pros? Cons?

  • Amanda D.

    October 10th, 2017 at 2:01 PM

    That sounds like a really good thing to be able to decide exactly how many hours and days you’ll be working. Another good thing is that there won’t be policies that you may disagree with, and you’ll always be able to do whatever you think is the best for your patient. It sounds like starting a therapy private practice is a great idea.

  • Joe

    August 4th, 2018 at 6:40 AM

    I’ve worked for a few private physical therapy practices at various locations in California and the recurring theme is clinics that are overloaded with patients and PTs working like they’re glorified personal trainers. I’ve noticed that the communities, insurance companies, and medical doctors have lost the true purpose and value that a PT is capable of providing. I think insurances companies are reducing reimbursement rates because of this poor patient quality of care trend. The PT private practice business model needs to reduce dependence on reimbursements to avoiding overcrowding clinics and providing bad therapy.

  • Dr. Ann

    April 19th, 2019 at 11:18 AM

    Starting my private practice has been one of the most rewarding choices I’ve made. Hard work but worth it!

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