a world with no traditional health insurance. It can and should be done.
I am looking at opening my practice again. If I do, I absolutely won’t take insurance, though I would be happy to give a receipt. And rates would be HUGELY lower. So, for example, in my world (a decade ago) insurance “paid” $160 for the initial (diagnostic) visit and $120 for follow-ups (if you could afford to pay someone to stay on hold for hours just trying to wrangle payment from the insurance company and even then the check might take months to get to you).
My thought is that I would charge $90 for whatever (every hour is certainly NOT filled–maybe only 5 or less are). Insurance for routine things is just HORRIBLE! Catastrophic is the only way to go.
Now $90 an hour sounds like a lot. But let’s call it $100 for ease of calculation. You fill 4 hours and get $1,600.00 a month. But wait, HALF goes to taxes (both federal, State, and local–much of which is after initial income taxes). So that leaves you $800 per month. And then there are expenses (rent is not free, there is $600 left–if you are amazingly lucky and frugal). Actually, there are A LOT of expenses. Phone alone costs maybe $200 per month. $400 now. And you have advertising. $300. And after-hours service. $200 left. Taxes are horribly complicated and unbelievably abstruse. You need an accountant so you don’t go to jail. The IRS is just not very forgiving. That desk cost money. That chair cost money. Those decorations cost money. Then you had to pay a Secretary to sit for hours on hold and get Insurance Company payments–maybe. Eventually.
Your only hope is in volume. But there are only so many hours. 20 billable hours a month is HUGE. And things certainly don’t scale down.
So in reality you are at about $15 or even $20 an hour. After a few years a person makes $36 an hour at Social Security and they probably only have a high school education (and you yourself have a Ph.D. or MD). So YOU paid through the ying-yang just to get your degree, and there were 10 years of lost earnings. And now it costs you about a grand (at least) a year just to stay licensed. Plus all those student loans that are due each month. And don’t kid yourself, you can not only go broke, but you can go into the hole. Your rent is a multi-year contract. And you wanted to buy a house and get married and get braces for your kid’s teeth… Great gig, eh?
You need to do the math.