Here’s a to-do list for starting a CM business
Plan ahead to avoid failure
Executive Summary
There's a lot more to being an independent case manager than just announcing that you're open for business. Being successful takes a lot of planning. Experts recommend:
- Develop a business plan and have Plan B and maybe Plan C in mind.
- Make sure you have enough in savings to pay your bills while you grow your business or plan on working a part-time job.
- Choose an area of specialization and research the market you want to be in to make sure there's a need for your services.
When you go out on your own as an independent case manager, you can’t just announce that you’re available and expect to have a successful business.
It takes a lot of preparation to go out on your own, says Catherine M. Mullahy, RN, BSN, CCRN, CCM, president and founder of Mullahy and Associates, a Huntington, NY, case management consulting firm.
"Starting a case management company provides an opportunity to create a business from the ground up, but it requires learning about business and finance — things that were of little use before but are very important now," she adds.
The most important part of being a solo practitioner is to develop a strategic business plan, says BK Kizziar, RN-BC, CCM, owner of BK & Associates, a Southlake, TX, case management consulting firm. It’s also critical to have a financial plan for the period of time in which you are building your business, she adds.
If you don’t have a clue how to do that, consult with the U.S. Small Business Administration in your area. They’re a great resource when you start a business, says Cheryl Acres, RN, CCM, owner of Comprehensive Care Management, LLC, based in suburban Dallas.
Mullahy recommends that you not only have a primary detailed business plan but that you also develop Plan B and maybe Plan C.
Prepare your finances
Financial preparation should be one of your first steps, says Teresa M. Treiger, RN-BC, MA, CHCQM-CM, CCM, owner of Ascent Care Management, LLC, in Holbrook, MA.
When you start your business, you need at least nine months to a year of reserve income so you can support yourself and your family when you get your business up and running, Treiger says.
"It’s great if a case manager is fortunate enough to have a life partner who is gainfully employed and the household can get by on one income. Otherwise you’ll need to decide how you’re going to pay your bills in the beginning," she says.
Most independent case managers have to work for someone else at least part time until they make enough working solo to pay the bills, adds Kizziar.
Choose an area in which to specialize, Kizziar says. "You can’t be all things to all people. You have to choose your niche," she says. Assess where your expertise and interests lie and decide what niche they want to fill, Kizziar says.
Do research to make sure you fully understand the market you choose and that you have the expertise and knowledge to work in that niche, Kizziar says.
Analyze the health status and demographics of the town and county to make sure there is a need for the kind of case management services you can provide. For instance, if you are interested in being a case manager for the elderly, you’re wasting your time if you focus on an area with a young population.
Check out the competition to learn what services are already out there and what niche you can fill, Mullahy says. "Competition is a good thing. It shows that there is an awareness of the value of case management. Breaking into the market may be easier if others have gone before you," she adds.
Seek legal advice to find out what you have to do to start a business in your state, what forms you have to file with the state, what kind of business license you need, and whether you need to incorporate, Treiger says. An attorney can also help you develop a contract to use with clients, she adds.
Meet with an accountant to get sound financial advice, Kizziar says. Accountants can advise you on tax issues and what records you need to keep, as well as what kind of corporation will be most beneficial from a tax standpoint, Kizziar says.
Sign up for malpractice insurance to protect yourself from legal action if you manage the care of someone who has an adverse outcome, suggests Elizabeth Hogue, Esq., a Washington, DC, attorney specializing in healthcare issues.
"Attorneys are trained to include everyone who sees a patient in any malpractice lawsuits they file. If you are included in a lawsuit, your insurer will assign legal counsel," she says.
Savvy clients will ask you if you have insurance before they contract with you, Treiger says.
"Not having insurance is not only irresponsible for the business owner, but it’s also a disservice to the people they serve," she adds. (For more advice on going solo, see related article CM finds satisfaction in being a solo practitioner.)
