The challenges and opportunities of a multi-disciplinary mixed-model practice

Business models at work…

The SAM Centre has been in operation for seven years and has evolved into a multi-disciplinary mixed-model practice. This type of practice developed organically in response to the diversity of practitioner needs and through the willingness of the practice director, Samantha McLeod, to support the practitioners’ preferred business arrangements.

Examples of the diversity of practitioner needs include:

• Subcontractors: Some practitioners new to private practice prefer some independence and autonomy but don’t want the responsibility of administration, marketing and practice overheads or management, and thus pay for these services (based on a percentage of fees earned ) under the banner of a common practice name.
• Independents: Some practitioners prefer to run their own business completely independently and rent the rooms based on fixed monthly rental fees assuming responsibility for all administrative and practice costs. For some practitioners, a casual rental agreement is preferred, whereby they can run their practices completely independently and book rooms on an hourly basis each week.
• Independents with support: Some independent practitioners opt to pay an additional fixed monthly fee for some client and office administration services.

Successfully managing the business side of The SAM Centre has required an ongoing commitment to both administrative duties and business development. Ideally, Sam would like to have one full day each week to dedicate to ‘running the practice’ and creating new opportunities for the business. In addition to the time that she has been able to devote to the business, Sam has invested in employing a range of staff to support good business practice. This includes hiring an experienced office manager and event coordinator, outsourcing accountancy, bookkeeping and legal services, along with part-time web and graphic design support.

Opportunities

The mixed-model group practice has provided a number of opportunities:

• Putting experience to work: Samantha describes establishing The SAM Centre as an opportunity to put her more than 20 years of private practice experience, as sole trader and subcontractor, into a more flexible group practice with increased capacity to deliver services within a sound clinical governance framework.
• Referring with confidence: Rather than referring to practitioners outside of the practice, Samantha has been able to help referrers and clients feel more confident by recommending good quality and experienced in-house practitioners.
• Maintaining a core group of practitioners for the practice: Providing practitioners the opportunity to establish working arrangements that match their individual needs has supported maintaining a core group of practitioners for the practice.
• Networking benefits: The mixed-model practice continues to provide access to strong, trusted networks that supports clients being well serviced.
• Student placements: Opportunities to offer support to students for placements (which is relatively rare in private practice) has been an added benefit.

Challenges

Samantha notes a number of challenges that come with establishing and running a successful mixed-model group practice. For example, younger business-minded practitioners can eventually move on to run their own business. Sam notes that it has been crucial to develop strategies to manage practitioner turnover to ensure the practice is consistent and sustainable. In addition, some practitioners tend not to be interested or motivated in the business aspects of a subcontracting arrangement, preferring to focus purely on clinical areas. This can result in more time devoted to the business aspect of the practice for Samantha.

Another challenge is securing a sufficient number of fixed rental arrangements as this is often not a practitioner’s preferred choice of business model. Thus the practice can end up sacrificing fixed rental arrangements for percentage of fee rental arrangements which has the potential to have a negative impact on cashflow.

For Samantha, The SAM Centre has been a rewarding step into the business side of psychological practice. While it has presented challenges, the mixed-model group practice has provided valued connections amongst practitioners, increased capability to deliver services as well as diversify services, and opportunities to give back to the profession through providing student placement opportunities.

1. Although there has been some concerns raised about rental agreements based on percentage of fees, Samantha reported that market research conducted before commencing The SAM Centre indicated that this model was the most commonly used model and appeared to benefit both parties (as long as it remained ethical and with good intention), and was also the most desired model from the practitioners interested in commencing work at The SAM Centre.