Starting a Private Practice in the US: Licenses, Registration, and What Practitioners Often Miss

Step 1: Register with your state licensing board

The process varies significantly by discipline and state, but once you’ve graduated, the most important first step is registering with your state licensing board. You can’t practice without it, and everything else depends on it.

Most allied health practitioners will move through some version of the following steps, though the specifics can vary by discipline and state:

National certification or board exam

• Most disciplines require passing a national exam before you can apply for licensure, and some states have additional exams or their own licensing process.

Jurisprudence exam (if required)

• Some states require an exam on local laws and regulations before granting licensure.

State licensing board registration

• Once your education and required exams are complete, you’ll apply to your state licensing board.

For most disciplines, this typically includes submitting proof of your degree or certification, your exam scores, and completing a state-specific application.

For behavioral and mental health practitioners, there are usually two stages:

• Apply for a provisional or associate-level license, which allows you to begin supervised clinical hours required for full independent licensure (about 2,000-4,000 hours).

• Once your supervision hours are complete and approved, you can apply for full independent licensure.

Justin notes that for chiropractors, the process can take roughly two months depending on your state, board requirements, and exam timing. For others, like behavioral and mental health practitioners, it often takes much longer.

Reminder: Most practitioners need to renew their professional license annually or biennially. Renewal fees typically run anywhere from $100-$500 or more, and some disciplines require continuing education (CE) credits to maintain licensure, so make sure to budget for these ahead of time.

Step 2: Set up and register your business

Before you open your doors, you’ll need to set up your business legally. This includes choosing a structure, naming your business, and registering it with your state.

Choose your business structure

Most practitioners starting a private practice choose one of the following:

• LLC (Limited Liability Company): A simple and flexible structure that separates your personal and business finances.

• PLLC (Professional Limited Liability Company) or Professional Corporation (PC): Similar to an LLC, but some states require licensed professionals to use this structure instead.

• S-corp: Deciding whether it’s time to form an S-corp typically comes a few years into your practice, once your income reaches a point where tax savings make it worthwhile.

Justin recommends speaking with an accountant before making a decision. But if you’re unsure, he suggests starting with an LLC or PLLC, as it “creates a separate business outside of your name.”

Choose your business name

• Check if the business name you want is available using your state’s business registry.

• Review any professional board requirements. Some disciplines have naming rules requiring first name, last name, and professional designation.

• Your registered name and brand name don’t have to be the same, but it does simplify things. If they’re going to be different, it’s best practice to register a DBA (Doing Business As).

Tip: If the business name you want is already taken, choose a variation. “A person I worked with got a cease and desist from a local business who felt their name was too similar and there might be confusion,” says Justin. When in doubt, alter your name early to save hassle down the line.

Register your business

Once you have your business structure and name, you can register with your state by filing one of the following:

• Articles of Organization: The paperwork that officially sets up your LLC or PLLC with your state.

• Articles of Incorporation: The paperwork used to form a Professional Corporation, if your state requires one.

Once this is filed and approved, your business is legally formed.

Step 3: Get your insurance

Start with Malpractice Insurance

Malpractice or professional liability insurance is non-negotiable. You need it before you see your first patient. “You can treat patients without having a formal business or an LLC, but if you don’t have malpractice insurance, you can’t do anything,” says Justin.

Every discipline has its go-to providers. For example, NCMIC is common for chiropractors, HPSO is widely used by physical therapists, and American Professional Agency is often used in behavioral and mental health.

If you’re unsure where to start:

• Check your professional association (many offer discounts).

• Ask colleagues in your field.

• Look at the providers most commonly used in your discipline.

Additional insurance to consider

• Disability insurance: Some specialties are physically demanding, so this will protect you if you’re ever unable to work. This is especially relevant for hands-on practitioners, where your ability to earn depends on your physical ability to treat patients.

• General liability insurance or a Business Owner’s Policy (BOP): Covers non-clinical risks in your space, like slip-and-fall accidents, property damage, or issues with your physical setup. A BOP often bundles general liability with coverage for your equipment, furniture, and leasehold improvements, which can be helpful once you have a physical clinic.

The cost of coverage

As your practice grows, your coverage needs and costs will likely grow with it, so you don’t need to find the perfect policy right away. Getting appropriate coverage in place is what matters most.

Insurance costs vary significantly by discipline, location, and patient volume, but generally, solo practitioners tend to pay lower fees since they’re only covering themselves, while group practices pay more to cover multiple practitioners and higher patient volume.

• Solo practitioners: ~$200-$700+ per year

• Group practices: ~$700-$1500+ per year

Tip: Check if your professional association has a relationship with an insurance provider. Many do, and they can often offer discounted rates or group pricing.

Step 4: Get your finances in order

With your business registered and insurance in place, there are a few financial steps left before starting your private practice.

Apply for an EIN and NPI

Two federal identifiers you’ll need to set up your business and start seeing patients:

• EIN (Employer Identification Number): This is essentially a Social Security Number for your business, and you’ll need it to open a business bank account, file taxes, and run payroll (if or when you hire).
• • Apply directly through the IRS website. The process is free and only takes about 15 minutes to complete. In most cases, you’ll receive your EIN immediately after submitting.

Reminder: Before filling out your application, make sure you have your legal business name and structure ready.

• NPI (National Provider Identifier): This is a unique 10-digit number for healthcare practitioners. It’s required for billing insurance and for common practices like transmitting health information electronically.
• • Register with the NPPES here. Processing typically takes two to four weeks, so don’t wait on this.

Open a business bank account

Separating your personal and business finances keeps you organized, simplifies your taxes, protects your liability, and makes it easier to pay yourself.

Understand your finances (and get an accountant)

An accountant is helpful when you’re getting started, but you still need a basic understanding of your finances.

A great place to start is with a simple spreadsheet that tracks how much money is coming in, and how much is going out. It will give you a clear picture of your finances and help you avoid surprises later.

It’s also a good idea to hire an accountant who can help you set up, organize, and file your federal income tax, self-employment tax, estimated quarterly taxes, and payroll taxes (if you plan to hire). Justin’s advice: “They have to have the heart of a teacher. They need to be able to teach you as a business owner, and you can’t be embarrassed to ask questions.”

Tax deductions practitioners easily miss

Justin shares: "There are going to be deductions that you're not aware of. Now that you're a business owner, you can write some things off and there's more planning involved."

• Home office: If you use part of your home exclusively for your practice, you may be able to deduct a portion of your expenses, even if you also have a physical clinic.

• Startup deductions (year one only): Expenses from before your first patient, like equipment, software, or licensing, can often be included in your first filing year.

• Software: Any software or tool you use to run your practice, like Jane, is deductible.

• Other common deductions: Travel (conferences, patient visits), business meals or team events, and continuing education (courses, exams, materials).

Tip: Keep a record of receipts over $75 either by taking a photo or preserving the physical receipt.

​​Plan ahead for year two

Many new practitioners are surprised by how quickly their income, and their tax bill, grows between year one and year two, which is why planning ahead matters.

A simple way to stay on track is to treat quarterly payments like rent: predictable and recurring. Set aside 25–30% of your monthly net income in a dedicated savings account from day one.

Step 5: Choose your billing model (and get paid)

Your billing model shapes your cash flow, your admin load, and how patients access your services. Most practitioners use one of these three primary models.

There’s no right or wrong way. The key is understanding the tradeoffs and choosing the model that best fits your practice and your life.

• Cash only: Patients pay at the time of service and may submit their own insurance claims. Best for practices that want immediate cash flow and simpler admin, though some patients may hesitate if they're used to direct billing.

• Insurance-based: You get credentialed with insurance companies and bill on behalf of patients, making it easier for them to access care. Best for specialties where insurance coverage drives patient volume, but expect more admin and follow-up, and reimbursements can take 30-60 days (or longer).

• Hybrid model: You accept insurance for some services while offering cash-pay options for others. Best for balancing patient accessibility with pricing and cash flow flexibility, but requires clear communication and strong systems in place

Tip: Alternative models like memberships, packages, or sliding scale pricing can be layered on top of your primary billing model to add flexibility, improve cash flow, or make care more accessible.

Justin’s advice is to think about the business you want to build long term, not just what gets patients through the door faster. “Ask, are you building the business for today or are you building the business that you want?”

Getting paid

Once your clinic is open, you'll need a reliable way to collect payment from patients.

Think through not just how you'll take payments, but how those payments connect to your invoicing and records.

For clinics and practitioners who bill insurance, accept cash payments, or offer both, Jane keeps everything connected. Its integrated clearinghouse and billing features, including superbills, help keep your cash flow moving. For cash pay or hybrid businesses, Jane Payments provides a PCI-compliant solution for both online and terminal payments. No manual reconciliation and no gaps in your records.

A word of advice

“People get stuck in the details,” says Justin. “All this stuff has to be done, but you can’t forget the essence of why you’re getting into business.”

Licensing and registration are just one part of starting a private practice. If you're in the beginning stages of opening or running a business and looking for more guidance, Jane has additional resources to support you along the way.

▶️ 5 Year-End Finance Tips for Private Practice

▶️ Cash vs. Insurance Billing: How to Choose the Best Model for Your Practice

▶️ How to Build a Clinic Brand in 5 Easy Steps