Navigating Your Career

The Decision to Start a Practice – Part 2

In part 2 of this series, Dr. Zalla discusses the following aspects of starting a new dermatology practice:

    • Buying an existing practice or building your own space
    • How long construction should take
    • Working with general contractors and architects
    • Office equipment: buy or lease
    • Recruiting the right people

Buying an Existing Practice or Building Your Own Space

While the space you design and build should be closest to your ideal, your actual ideal may be out of your price range early in your career. Decisions will be based on local demographics and costs and must be individualized. In some locales, medical office space zoning and construction can be a prolonged process, so this must be factored in. If you know the area well and plan to be there long term, early purchase is an option; but you will need large sums of money to pay for property, construction, and possibly architectural fees, which, based on your current education debt load and other factors, banks may be hesitant to loan. An already fitted-out rental may be less costly, give you time to examine the area closely and determine the optimal place to be, and let you have a place to practice immediately after completing your training if desired.

An already fitted-out rental may be less costly, give you time to examine the area closely and determine the optimal place to be.


How Long Should Construction Take?

With the use of modular construction allowed in some locales, and an efficient builder, one can go from start to finished and fitted in as little as a few months. Alternatively, construction can take longer than a year. If you need permits and inspections, they can add as little as weeks or as long as years in some locales. The availability of subcontractor crews and the prioritization you get from the builder add great variability to the mix.


Working With General Contractors and Architects

You will most likely work with a general contractor (GC) who will hire carpenters, plumbers, electricians, insulation crews, and others as needs arise, as well as possibly some of their own direct employees. In any event you must carefully examine their contract so that a lien against them from a supplier or subcontractor does not automatically involve you. Money spent on a good contract attorney up front can save you a lot of headaches and expense downstream. It is likely that the architect’s and GC’s contracts will be boilerplate and biased to protect them and to offload costs to you in the event of delays, so this will need to be modified. Some architects and GCs will work together, while others will work separately; and there are pros and cons to both approaches.


You could be your own GC if you have a spouse or trusted family member or friend working with you, but this approach is usually far more complex for commercial property than for homebuilding and probably best avoided. On the other hand, having such a person on site at least daily taking photos of all construction and being present for major items (laying foundations, interim inspections) can avoid the pitfalls common in some geographic areas.


Office Equipment: to Buy or Lease

It is generally more economical to purchase office equipment such as computers, printers, fax machines, and copy machines. Exceptions might include equipment whose lease includes a maintenance agreement for regular servicing, such as a high capacity copier or lasers that may become obsolete in a few years.


Office furniture can be another significant expense, and even if outfitting your office requires bank financing, purchasing your own furniture is still likely to be less costly than leasing. You should approach every purchase decision with the thought in mind, “Everything is negotiable.” You can save thousands of dollars year after year simply by asking for a better price. Receiving bids from multiple vendors is also important in getting the most value for money. Office supplies can be obtained for less at warehouse clubs like Sam’s® or Costco®, or sources like Amazon® and Staples®.


Even if outfitting your office requires bank financing, purchasing your own furniture is still likely to be less costly than leasing.


We have a Comdial® digital communication system in our office consisting of a six-line wired phone with rollover capability and the usual features. It is easy to track the call volume per hour over the course of a day and allocate staff accordingly for telephone answering. A wireless hands-free headset for receptionist staff is recommended. A small office could get by with fewer lines, but keeping the capacity to expand without having to replace the phone hardware is an advantage. Lab coats and scrub suits are available from multiple sources and look more professional if they bear your office logo and your name. Magnetic badges with the names and office logo are a good choice for staff.
Signage at various locations throughout your office should look professional and blend in with the office décor. It will save you money to prepare a master list of each sign required, together with its location, and request proposals from several vendors.

Recruiting the Right People

We have never used an outside staffing firm, but normally place an ad in the local paper and online job boards with replies to a local P.O. Box. Along with the résumé, we request a handwritten cover letter, because being able to discard the applications of those who cannot draft a concise, legible, neat letter avoids wasting time on an interview.


It is recommended that you personally interview all applicants for clinical positions, as well as the finalists for front office staff who have been filtered by an office manager or business manager. If we do not receive sufficient response from an ad, we have found it better to run an ad again rather than settle for a marginal candidate from a limited candidate pool. We look for above average applicants, who also seem to be nice people based on our interview impressions and their references. We have found that we can train staff to learn computer software or to assist in surgery, etc, but we cannot train them to be “pleasant.” They have to bring that quality with them when they join our staff, and we feel we owe this to our existing staff.


If we do not receive sufficient response from an ad, we have found it better to run an ad again rather than settle for a marginal candidate from a limited candidate pool.


We use a job-sharing approach for most of our positions, and these staff work less than full-time at our front desk and in our medical assistant/nurse positions. To have an option beyond full-time staff expands the candidate pool and provides continuous coverage when staff are on vacation. We also find that most part-time staff do not need health insurance benefits because their spouse already has this through their own employment.


We do provide a Flexible Benefit Plan for all staff, with a uniform allowance, and have a 401K Pension Plan with match and profit-sharing contributions for participating staff. Fulltime staff can expect health insurance coverage.


We definitely recommend using an outside payroll service, which is less costly and simplifies all the record-keeping by tracking the hours, paid time off, withholdings, pension and flexible benefit contributions, and tax accounting for the office administrator. Comparative regional salary and benefit information is available from Medical Group Management Association (MGMA) and other sources.


Our dermatologists normally have two medical assistants or nurses used interchangeably whenever we see patients. However, we would normally have three staff assigned to us who share those duties on different days, e.g., one staff works four days, and two staff work two days/week each. It takes approximately one full-time equivalent claims person for one full-time dermatologist in our office, although use of an outside billing service should reduce the number of staff needed for billing and claims work.


Staff need job descriptions as well as periodic evaluations. It also helps to have training manuals that describe the standard procedures, and we have developed these ourselves with input from staff who are also responsible for updating them periodically.


We have monthly staff meetings, alternating with the front office staff (receptionist, billing, and claims staff) the first month and the clinical staff (medical assistants and nurses) the next month, with two joint meetings per year when all the staff come together. This provides a forum for staff input as a source for helpful suggestions and also facilitates healthy communication among staff so they understand each other’s challenges.


All staff must share our patient-centered practice philosophy, which is reflected in a quote by William J. Mayo on a large wall hanging in our waiting room: “The best interest of the patient is the only interest to be considered.”


Finally, for several years now we have been finding the Doctor Score patient satisfaction assessment system useful (, and there are others available as well. While most patient comments are expressions of appreciation for their experience in the office, it is affirming for excellent staff behavior to be acknowledged by patients. In the occasional instances that a staff member falls short of our expectations, we might hear of this first through a patient comment on a Doctor Score report. Early clues to staff shortcomings during their probationary period have prompted us to find a replacement for that staff member.


Always compliment exemplary staff performance in the presence of other staff or patients; however, addressing deficient performance, which we call “opportunities for improvement,” should always be done privately.


Over the years we have found a most useful indicator of whether to keep a staff member is to ask yourself, “If I had known then, before hiring her/him, what I know now about this staff member’s performance, would I have made that hire in the first place?” If the answer to that question is “No,” that staff member should go.



Opening a dermatology practice never resembles residency. There are important financial, logistical, and managerial issues to consider. Apart from selecting an optimal location for office space, there are also the questions of leasing space vs owning space and how to lay out the practice’s interior design. While working with contractors, selecting signage, setting up computers and technology, and staffing your office can be intimidating, smart decisions made in a practice’s early days pay dividends later on.


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