Floodgates: a big rate limiting step in opening your solo medical practice

As we’ve mentioned several times in this blog, one of the biggest rate limiting steps to opening your medical practice is signing your office lease. You need a official address to incorporate your business, get your TIN (taxpayer ID number) from the IRS, open a business banking account, obtain hospital privileges, credential with Medicare, fill out your CAQH application, commercial insurances, IPA and ACOs.

Should I use a temporary address to get the ball rolling?

Many doctors going solo wonder if they can use a PO box, their home address, or their attorney’s address or a friend’s medical office as their temporary business address to get the ball rolling on their credentialing. Then when you have your permanent business office address, you can simply switch addresses, right?

Most folks don’t do this, because insurance companies can sometimes be worried about fraud and check up on things. Indeed, noridian Medicare actually phoned me to verify my address and requested I send them a copy of my lease! I certainly wouldn’t have been off on the right foot with them had I given them my home address.

In terms of all of my credentialing such as the Medicare application, CAQH, and commercials (to be discussed in future posts), I had carefully researched Ho Sun’s original blog, and filled out the paperwork as far as I could. The week before I signed by lease, I had filled out the paperwork for the AZ corporation commission to incorporate, had figured out to quickly fill out the PECOS application for Medicare, as well as fill out as much of the CAQH and other applications as I could.

Addendum: a reader wisely pointed out that you want to incorporate before signing your lease. When I finalized reading and negotiating my lease agreement, before it was signed I went ahead and incorporated. It would’ve been a pain if somehow the lease fell enough, but you want to use your company rather than your personal name on the lease for liability reasons- such if there is a slip and fall on your premises.

Should I hire a company to do my Medicare and commercial credentialing for me?

Ho Sun and I agree that the answer is absolutely no. There’s no one that cares more that your information is entered accurately, and that credentialing is done promptly, as you. Many companies will take your money, and then make things worse than if you had done it yourself, by inadvertently entering inaccurate information, or failing to follow up.

Many credentialing companies will talk about the “complexity” of the system and how their “experts” know their way around things- but often they don’t know which commercials need a change of address vs credentialing from scratch, or which specific insurances are affiliated with certain IPAs or ACOs.

Did you pay someone to fill out your medical school applications or residency program applications? If you didn’t, then you don’t need to pay someone to fill out your credentialing applications.

Here’s Ho Sun’s take on tasks to do after you get your business address, originally published October 23, 2010:

My landlord mailed me the keys to the office, and I now had access to my new business address.  Now, I had to get moving on so many tasks that were pending my acquisition of a business address.

Here is the list of things that I now needed to do:

1. Change address: medical license, DEA number, NPI number, malpractice insurance

2. Establish business entity

3. Obtain federal tax (employer ) ID number

4. Obtain state employment development deparatment (EDD) number

5. Apply for hospital privileges

6. Apply for Medicare, MediCal (California Medicaid), private insurance carriers

7. File for fictitious business name with county and state medical board

8. Apply for local business license

9. Apply for business owner’s policy insurance

10. Set up business entity NPI number

11. Set up business checking account

Most of these items, I will go over in separate posts, but I’ll just briefly touch on the changing addresses on certain items, which were easy.

NPI Number

This was by far the easiest.  This was for my personal NPI number by the way.  I just went on to the NPI website: NPI Website, logged in, and changed my address, which was effective immediately. I didn’t have to do anything else.

California Medical License

I had to fill out a change of address form, which can be found at: California Medical License Address Change, and I printed it and faxed it over.  I checked my California medical license information online about 10 days later, and saw my new address posted.

DEA Number

I also had to fill out an online address change form, which is found at: DEA Address Change Request.  I submitted the request online, but I had to fax a copy of my California medical license to the DEA office.  My updated DEA certificate arrived in the mail within one week.  I have to say that the DEA office has the quickest processing times of all government organizations I have dealt with so far.

Malpractice Insurance

This one was also easy.  I just had to e-mail my state’s contact person at OMIC, and it was done!

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