Running a practice
What psychiatrists do (and don’t) need to start a private practice
We’ll walk you through the non-negotiables, as well as the things you can go without.
October 3, 2025
3 min read
It’s easy to get overwhelmed by your to-do list when branching out into private psychiatric practice. But here’s the good news: That daunting to-do list doesn’t need to be so long.
Psychiatrists and psychiatric nurse practitioners looking to move into private practice often get bogged down in unnecessary details as they prepare to make the exciting jump. Focusing only on the tasks that really matter, while eliminating or putting off those that don’t, can make your dream of entering private practice feel much more attainable.
In this article, which draws from The Psychiatrist’s Guide to Starting a Private Practice ebook, we’ll walk through the non-negotiables that you absolutely need to start a psychiatric private practice — and the things you can go without.
What you *do* need
The truth is, many of the things providers think they need to go into private practice are really “nice-to-haves,” rather than true necessities. Block out the noise and focus on the four things below, which you truly can’t go without.
1. Compliance and credentialing basics
First and foremost, you need to make sure you’re ready to see patients and prescribe medication without violating any laws, regulations, or compliance standards. To ensure that’s the case, you’ll need:
- An active state license, which is required to administer clinical services
- Registration with the Drug Enforcement Administration, which is required to prescribe controlled substances. Depending on the state in which you practice, you may also need a state-specific controlled substance license
- Malpractice insurance with prescriber coverage to protect your finances and license in case of legal action
- A National Provider Identifier (NPI) number and Council for Affordable Quality Healthcare (CAQH) profile, which are needed to get credentialed with insurance
- A collaborating physician, if you're a psychiatric mental health nurse practitioner operating in a state that requires one.
2. Clinical infrastructure
Once you’ve got your paperwork and licenses squared away, your next step is getting logistically ready to see patients. To do so, make sure you have:
- A HIPAA-compliant electronic health record (EHR) and ePrescribe tool, so you can properly create and store documentation, send prescriptions, collaborate with pharmacists and other clinicians, and complete other critical tasks
- Compliant telehealth software, if you plan to offer virtual services (These days, most psychiatrists do)
- Secure and HIPAA-compliant patient communication channels
Some platforms helpfully bundle these tools so you don’t have to purchase, implement, and use each one separately. Headway, for example, offers an EHR, billing support, integrated telehealth, and client scheduling and communication tools in one convenient — and free — package.
3. A plan for payments
Before you get up and running in private practice, you’ll need to decide if you’ll accept insurance, work under a private pay model, or employ some combination of the two.
Each approach comes with trade-offs. Private pay may be more straightforward than taking insurance, but it can deter patients who can’t afford — or just don’t want to — pay out-of-pocket.
On the flip side, accepting insurance expands access and thus may attract more patients, but it can come with logistical headaches, like lengthy credentialing processes and the potential for rejected, delayed, or clawed-back claims.
Working with a partner like Headway can maximize the benefits and minimize the downsides of accepting insurance, making the process both simpler and more lucrative. Headway shortens the credentialing process to as little as 30 days. And once you’re onboarded with insurance panels, you can rely on Headway to help with claim submission, with the guarantee of competitive and consistent biweekly pay.
4. A way to attract patients
Last but not least, you need a marketing plan to introduce patients to your private practice. You can always supplement your marketing efforts as you grow — but to get started, make sure you have basics like:
- Profiles with top provider directories, including Psychology Today, Zocdoc, and Headway
- A website that patients can use to learn more about you and contact you
- A professional biography and headshot that you can use across your online presence to help build authority and client trust
For the full guide to getting started, check out our ebook: The Psychiatrist’s Guide to Starting a Private Practice.
Practice in-network with confidence
Simplify insurance and save time on your entire workflow — from compliance and billing to credentialing and admin.
What you don’t need
It’s easy to overcomplicate the process of launching a private practice — but you don’t need to fall into that trap. Regardless of what you may have heard, the four things below aren’t actually necessary for starting a private psychiatric practice.
1. A full office lease
As mental health care increasingly goes virtual, you may not need a traditional office lease. Rather than signing on to a costly long-term lease right away, explore possibilities like shared office spaces — perhaps you use the space a couple days a week, while other clinicians use it for the remaining time — or even a 100% remote practice.
2. A formal business entity
There are benefits to creating a formal business entity, such as an LLC, PLLC, or S-Corp. Doing so reduces your personal liability in case you’re subject to legal action, and may also come with tax benefits. But it’s not strictly necessary to incorporate your business. If you’re looking to reduce complexity and cost while launching your private practice, you may opt to practice as a sole proprietor instead.
3. Fancy marketing campaigns
You may feel pressured to use paid advertisements, ambitious social media campaigns, or other cost- and labor-intensive marketing strategies to get the word out as soon as you launch your private practice. While these approaches may make sense someday, you don’t need them right out of the gate. To start, just focus on honing the simple online presence described above.
4. A full caseload from day one
Particularly if you’re coming from an established group practice or a large health system, you may be used to being booked solid all day long — so it can feel uncomfortable if your private practice roster doesn’t fill up immediately. Don’t panic if that’s the case. Remember, building a sustainable business is a marathon, not a sprint. It can take time to build up a strong referral network and online presence, but that doesn’t mean you’re doing it wrong.
Let Headway be your partner in private practice
When you’re transitioning into private practice, you have a lot on your plate. Lighten your load by working with Headway, an all-in-one platform that bundles together must-have features — like credentialing assistance, billing support, an EHR, and integrated telehealth — without charging a cent. When administrative tasks are taken care of, you have more time and energy to do the work that matters most: helping patients achieve balanced, sustainable mental health.
This content is for general informational and educational purposes only and does not constitute clinical, legal, financial, or professional advice. All decisions should be made at the discretion of the individual or organization, in consultation with qualified clinical, legal, or other appropriate professionals.
© 2025 Therapymatch, Inc. dba Headway. All rights reserved. No part of this publication may be reproduced without permission.
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