Mental Health Private Practice Business Plan
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Below is a template to help you create each section of your Mental Health Private Practice business plan.
Executive Summary
Business Overview
Harmony Mental Health Center is a new mental health private practice located in Portland, Oregon. The practice is focused on helping community members cope with their mental health concerns, such as dealing with life challenges or living with severe mental health disorders. The practice will have a full staff of counselors, psychologists, and psychiatrists in order to offer as many services as possible to help our clients cope and improve their mental well-being.
Harmony Mental Health Center is led by Sasha Pascal, who has been a trained and licensed psychiatrist for 20 years. She has seen many people stop care or not get care at all due to the expensive costs of the mental health industry. She has made it her mission to create a practice that offers a sliding scale so that more members of the Portland community can get the help they need.
Product Offering
Harmony Mental Health Center will provide several mental health services to its clientele to help them with their life challenges and mental health concerns. Some of these services include:
- Mental health disorder diagnosis and management
- Individual counseling
- Group therapy
- Couples counseling
- Medication prescription and management
- Complementary mental health services (such as yoga or meditation)
Customer Focus
Harmony Mental Health Center will serve the residents of the Portland, Oregon area who are struggling with difficult life challenges or serious mental health concerns. We will primarily target residents earning less than the local median income by offering a sliding scale fee system.
Management Team
Harmony Mental Health Center is led by Sasha Pascal, who has been a trained and licensed psychiatrist for 20 years. Throughout her career, Sasha has helped hundreds of clients improve their mental health by providing counseling and medication management services. However, she has seen many people stop care or not get care at all due to the expensive costs of the mental health industry. She has made it her mission to create a practice that offers a sliding scale so that more members of the Portland community can get the help they need.
Success Factors
Harmony Mental Health Center will be able to achieve success by offering the following competitive advantages:
- Friendly, knowledgeable, and highly qualified team of mental health professionals that will provide effective treatment plans depending on the clients mental health history and needs.
- Comprehensive list of mental health services that allows the counseling staff to find the best treatment options for each client.
- An affordable sliding scale that makes our mental health services far more affordable than the competition.
Download the Mental Health Private Practice business plan template (including a customizable financial model) to your computer here <–
Financial Highlights
Harmony Mental Health Center is currently seeking $650,000 to launch. The funding will be dedicated towards securing the office space and purchasing equipment and supplies. Funding will also be dedicated towards three months of overhead costs to include payroll of the staff, rent, and marketing costs. Specifically, these funds will be used as follows:
- Office interior build out and design: $100,000
- Office equipment, supplies, and materials: $100,000
- Three months of overhead expenses (payroll, rent, utilities): $300,000
- Marketing costs: $50,000
- Working capital: $100,000
The following graph below outlines the pro forma financial projections for Harmony Mental Health Center.
Company Overview
Who is Harmony Mental Health Center?
Harmony Mental Health Center is a new mental health private practice located in Portland, Oregon. The practice is focused on helping community members cope with their mental health concerns, particularly those who are living with severe conditions such as bipolar disorder, schizophrenia, or post traumatic stress disorder (PTSD). The practice will have a full staff of counselors, psychologists, and psychiatrists in order to offer as many services as possible to help our clients cope and improve their mental well-being.
In addition to providing these services, we offer sliding scale rates for members who earn below the local median salary. Mental health services are typically very expensive, which prevents many people with mental health disorders from getting the help they need. We hope that by providing this sliding scale, more people will be able to afford our care and get help.
Harmony Mental Health Center is led by Sasha Pascal, who has been a trained and licensed psychiatrist for 20 years. Throughout her career, Sasha has helped hundreds of clients improve their mental health by providing counseling and medication management services. However, she has seen many people stop care or not get care at all due to the expensive costs of the mental health industry. She has made it her mission to create a practice that offers a sliding scale so that more members of the Portland community can get the help they need.
Harmony Mental Health Center’s History
Once Sasha came up with her idea to offer affordable mental health services, she immediately began to do the groundwork to make it a reality. She conducted a market analysis to see who would benefit the most from these services and recruited other mental health professionals who were interested in joining the practice.
After finishing her analysis, she set out to find a potential office location. She has found an ideal location and is currently due diligence on the property. Once the lease is signed, all operations will move there.
Since incorporation, Harmony Mental Health Center has achieved the following milestones:
- Found a potential commercial space and signed a Letter of Intent to lease it
- Developed the company’s name, logo, social media accounts, and website
- Determined space design and required equipment
- Hired an administrative assistant to help with bookings and schedules
- Hired several mental health professionals to the team
Harmony Mental Health Center’s Services
Harmony Mental Health Center will provide a wide variety of services to help our clients cope with their challenges and mental health concerns. Each client’s path of treatment will vary depending on their condition or particular challenges and needs.
Below is a list of some of the services that Harmony Mental Health Center will offer to its clients:
- Mental health disorder diagnosis and management
- Individual counseling
- Group therapy
- Couples counseling
- Medication prescription and management
- Complementary mental health services (such as yoga or meditation)
Industry Analysis
The mental health services industry is expected to grow substantially over the next few years.
Now that the world understands the importance of mental health, many people are seeking out care for their mental health concerns. This is creating incredible demand for mental health private practices and the expertise and care of mental health professionals. This demand will ensure the industry continues to expand and remains profitable.
One challenge to private practices is the popularity of app-based therapy companies such as BetterHelp and Talkspace. These apps have thousands of customers due to their convenience and affordable rates. Private practices that offer remote sessions and inexpensive fees will be able to compete with these apps.
Another challenge is the skyrocketing costs of mental health care. Due to demand and inflation, counseling fees and medication costs are quickly rising. This makes it much harder for people in middle or lower economic brackets to receive the care they need. Practices that offer sliding scale fees or partner with numerous insurance plans are more likely to keep a steady clientbase.
Download the Mental Health Private Practice business plan template (including a customizable financial model) to your computer here <–
Customer Analysis
Demographic Profile of Target Market
Harmony Mental Health Center will serve the residents of the Portland, Oregon area who are struggling with difficult life challenges or serious mental health concerns. We will primarily target residents earning less than the local median income by offering a sliding scale fee system.
The demographic for the Portland, Oregon area are as follows:
| Total | Percent | |
|---|---|---|
| Total population | 1,680,988 | 100% |
| Male | 838,675 | 49.9% |
| Female | 842,313 | 50.1% |
| 20 to 24 years | 114,872 | 6.8% |
| 25 to 34 years | 273,588 | 16.3% |
| 35 to 44 years | 235,946 | 14.0% |
| 45 to 54 years | 210,256 | 12.5% |
| 55 to 59 years | 105,057 | 6.2% |
| 60 to 64 years | 87,484 | 5.2% |
| 65 to 74 years | 116,878 | 7.0% |
| 75 to 84 years | 52,524 | 3.1% |
Customer Segmentation
Harmony Mental Health Center will primarily target the following customer profiles:
- Residents with mental health conditions
- Residents earning less than the median income
- Young adults
Competitive Analysis
Direct and Indirect Competitors
Harmony Mental Health Center will face competition from other companies with similar business profiles. A description of each competitor company is below.
Mount Hood Therapy Center
Mount Hood Therapy Center is a large and popular therapy clinic that provides a wide range of counseling and mental health services. It staffs dozens of mental health professionals who all have various backgrounds, training, and education. This allows them to serve as many clients as possible and provide them with the exact mental health treatment they need. These services include traditional counseling, medication management, and complementary therapies, such as yoga.
While we expect Mount Hood Therapy Center to continue to thrive based on its popularity and variety of services offered, the clinic is very expensive and primarily caters to residents who earn a high income or have great insurance. Residents earning under the median income are not likely to afford these services and will come to Harmony Mental Health Center to receive care.
Stumptown Wellness
Stumptown Wellness is a counseling clinic that will be located in the same business center as Harmony Mental Health Center. It is a fairly affordable clinic that provides individual, group, and couples counseling services. It is one of the more popular counseling clinics in the area and has had a great reputation since its opening in 2005.
Though Stumptown Wellness is thriving, the practice does not offer psychiatry services or medication management options. Many people with mental health conditions utilize these services to manage their symptoms and need a practice that provides them. Therefore, people with these conditions will be more inclined to seek the help of Harmony Mental Health Center.
Mental Health Matters
Mental Health Matters is a community service of affordable therapy offered by a local university. It is run by students who are training to become licensed therapists but do not have a license yet. They are supervised by their professors, who are trained, experienced, and licensed therapists. Because licensed professionals do not conduct the services, they are offered at an affordable rate and only to clients who earn less than the median income in the area.
Though Mental Health Matters offers a great service to the community, many clients prefer working with a licensed professional. We will be able to provide a similar sliding scale but also provide mental health services that are administered by trained and licensed professionals. Mental Health Matters also does not provide psychiatric services which our practice will have.
Download the Mental Health Private Practice business plan template (including a customizable financial model) to your computer here <–
Competitive Advantage
Harmony Mental Health Center will be able to offer the following advantages over their competition:
- Friendly and qualified staff: Harmony Mental Health Center will hire a team of friendly, knowledgeable, and highly qualified mental health professionals that will provide effective treatment plans to our clients.
- Quality mental health services: Harmony Mental Health Center will have a comprehensive list of mental health services that allows the counseling staff to find the best treatment options for each client.
- Sliding scale: Harmony Mental Health Center will offer a sliding scale fee system that makes our mental health services far more affordable than the competition.
Marketing Plan
Brand & Value Proposition
Harmony Mental Health Center will offer the unique value proposition to its clientele:
- Convenient location
- Qualified and highly trained team of counselors, psychologists, and psychiatrists
- Comfortable, relaxing atmosphere
- Sliding scale for residents earning less than the median income
Promotions Strategy
The promotions strategy for Harmony Mental Health Center is as follows:
Website/SEO
Harmony Mental Health Center will design an efficient and appealing website to attract clients. The website will be well organized, informative, and list the services that we provide. The website will also list information about our sliding scale.
We will also manage the company’s website presence with SEO marketing tactics so that when someone types in a search engine “Portland mental health center ” or “mental health center near me”, Harmony Mental Health Center will be listed at the top of the search results.
Social Media
Sasha Pascal will create accounts on social media platforms such as LinkedIn, Twitter, Instagram, Facebook, TikTok, and YouTube. She will ensure Harmony Mental Health Center maintains an active social media presence with regular updates and promotional content to incentivize customers to utilize our services.
Doctor’s Offices
Sasha will visit multiple doctors and primary care offices to ask them to refer our company to any patients needing affordable mental health services. We will ask them to keep a handful of our brochures on hand and hand them out to whoever requests a mental health clinic.
Ongoing Customer Communications
Harmony Mental Health Center will publish a monthly email newsletter to provide education information about mental health as well as self-care tips.
Pricing
Harmony Mental Health Center’s pricing will be moderate so clients feel they receive great value when utilizing our mental health services. We will bill our clients’ insurance companies first and then charge our clients directly for whatever their plans don’t cover.
Operations Plan
The following will be the operations plan for Harmony Mental Health Center.
Operation Functions:
- Sasha Pascal will be the President of Harmony Mental Health Center and oversee the general operations of the practice. She will also provide counseling and psychiatry services to her initial clientbase.
- Sasha recently hired an Administrative Assistant named Janie White. She will help with scheduling appointments, basic marketing tasks, and other general administrative duties.
- To meet the mental health needs of the community, Sasha will hire a solid team of counselors, psychologists, and psychiatrists who can provide a wide variety of mental health services for the company.
Download the Mental Health Private Practice business plan template (including a customizable financial model) to your computer here <–
Milestones:
Harmony Mental Health Center will have the following milestones completed in the next six months.
- 07/202X – Finalize lease agreement
- 08/202X – Design and build out Harmony Mental Health Center
- 09/202X – Hire and train initial staff
- 10/202X – Kickoff of promotional campaign
- 11/202X – Launch Harmony Mental Health Center
- 12/202X – Reach break-even
Management Team
Harmony Mental Health Center is led by Sasha Pascal, who has been a trained and licensed psychiatrist for 20 years. Throughout her career, Sasha has helped hundreds of clients improve their mental health by providing counseling and medication management services. However, she has seen many people stop care or not get care at all due to the expensive costs of the mental health industry. She has made it her mission to create a practice that offers a sliding scale so that more members of the Portland community can get the help they need.
Sasha Pascal has a Ph.D in Psychology from the University of Oregon. In addition to helping clients with their mental health concerns, she has been running her own private practice for nearly ten years. Therefore, she has the necessary experience to run a larger mental health private practice and will lead our company to success.
Financial Plan
Key Revenue & Costs
The key revenues for Harmony Mental Health Center will come from the fees charged for providing mental health services. The fees will either be charged directly to the client or their insurance carrier, depending on whether or not they have insurance coverage for mental health care.
The major cost drivers for the company will include the cost of supplies, salaries, overhead costs, and marketing expenses.
Funding Requirements and Use of Funds
Harmony Mental Health Center is currently seeking $650,000 to launch. The funding will be dedicated towards securing the office space and purchasing equipment and supplies. Funding will also be dedicated towards three months of overhead costs to include payroll of the staff, rent, and marketing costs. Specifically, these funds will be used as follows:
- Office interior build out and design: $100,000
- Office equipment, supplies, and materials: $100,000
- Three months of overhead expenses (payroll, rent, utilities): $300,000
- Marketing costs: $50,000
- Working capital: $100,000
Download the Mental Health Private Practice business plan template (including a customizable financial model) to your computer here <–
Key Assumptions
The following outlines the key assumptions required in order to achieve the revenue and cost numbers in the financials and pay off the startup business loan.
- Number of clients per year:
- Year 1: 55
- Year 2: 80
- Year 3: 125
- Year 4: 165
- Year 5: 200
- Annual rent: $100,000
- Average counseling session cost: $100
Financial Projections
Income Statement
| FY 1 | FY 2 | FY 3 | FY 4 | FY 5 | ||
|---|---|---|---|---|---|---|
| Revenues | ||||||
| Total Revenues | $360,000 | $793,728 | $875,006 | $964,606 | $1,063,382 | |
| Expenses & Costs | ||||||
| Cost of goods sold | $64,800 | $142,871 | $157,501 | $173,629 | $191,409 | |
| Lease | $50,000 | $51,250 | $52,531 | $53,845 | $55,191 | |
| Marketing | $10,000 | $8,000 | $8,000 | $8,000 | $8,000 | |
| Salaries | $157,015 | $214,030 | $235,968 | $247,766 | $260,155 | |
| Initial expenditure | $10,000 | $0 | $0 | $0 | $0 | |
| Total Expenses & Costs | $291,815 | $416,151 | $454,000 | $483,240 | $514,754 | |
| EBITDA | $68,185 | $377,577 | $421,005 | $481,366 | $548,628 | |
| Depreciation | $27,160 | $27,160 | $27,160 | $27,160 | $27,160 | |
| EBIT | $41,025 | $350,417 | $393,845 | $454,206 | $521,468 | |
| Interest | $23,462 | $20,529 | $17,596 | $14,664 | $11,731 | |
| PRETAX INCOME | $17,563 | $329,888 | $376,249 | $439,543 | $509,737 | |
| Net Operating Loss | $0 | $0 | $0 | $0 | $0 | |
| Use of Net Operating Loss | $0 | $0 | $0 | $0 | $0 | |
| Taxable Income | $17,563 | $329,888 | $376,249 | $439,543 | $509,737 | |
| Income Tax Expense | $6,147 | $115,461 | $131,687 | $153,840 | $178,408 | |
| NET INCOME | $11,416 | $214,427 | $244,562 | $285,703 | $331,329 |
Balance Sheet
| FY 1 | FY 2 | FY 3 | FY 4 | FY 5 | ||
|---|---|---|---|---|---|---|
| ASSETS | ||||||
| Cash | $154,257 | $348,760 | $573,195 | $838,550 | $1,149,286 | |
| Accounts receivable | $0 | $0 | $0 | $0 | $0 | |
| Inventory | $30,000 | $33,072 | $36,459 | $40,192 | $44,308 | |
| Total Current Assets | $184,257 | $381,832 | $609,654 | $878,742 | $1,193,594 | |
| Fixed assets | $180,950 | $180,950 | $180,950 | $180,950 | $180,950 | |
| Depreciation | $27,160 | $54,320 | $81,480 | $108,640 | $135,800 | |
| Net fixed assets | $153,790 | $126,630 | $99,470 | $72,310 | $45,150 | |
| TOTAL ASSETS | $338,047 | $508,462 | $709,124 | $951,052 | $1,238,744 | |
| LIABILITIES & EQUITY | ||||||
| Debt | $315,831 | $270,713 | $225,594 | $180,475 | $135,356 | |
| Accounts payable | $10,800 | $11,906 | $13,125 | $14,469 | $15,951 | |
| Total Liability | $326,631 | $282,618 | $238,719 | $194,944 | $151,307 | |
| Share Capital | $0 | $0 | $0 | $0 | $0 | |
| Retained earnings | $11,416 | $225,843 | $470,405 | $756,108 | $1,087,437 | |
| Total Equity | $11,416 | $225,843 | $470,405 | $756,108 | $1,087,437 | |
| TOTAL LIABILITIES & EQUITY | $338,047 | $508,462 | $709,124 | $951,052 | $1,238,744 |
Cash Flow Statement
| FY 1 | FY 2 | FY 3 | FY 4 | FY 5 | ||
|---|---|---|---|---|---|---|
| CASH FLOW FROM OPERATIONS | ||||||
| Net Income (Loss) | $11,416 | $214,427 | $244,562 | $285,703 | $331,329 | |
| Change in working capital | ($19,200) | ($1,966) | ($2,167) | ($2,389) | ($2,634) | |
| Depreciation | $27,160 | $27,160 | $27,160 | $27,160 | $27,160 | |
| Net Cash Flow from Operations | $19,376 | $239,621 | $269,554 | $310,473 | $355,855 | |
| CASH FLOW FROM INVESTMENTS | ||||||
| Investment | ($180,950) | $0 | $0 | $0 | $0 | |
| Net Cash Flow from Investments | ($180,950) | $0 | $0 | $0 | $0 | |
| CASH FLOW FROM FINANCING | ||||||
| Cash from equity | $0 | $0 | $0 | $0 | $0 | |
| Cash from debt | $315,831 | ($45,119) | ($45,119) | ($45,119) | ($45,119) | |
| Net Cash Flow from Financing | $315,831 | ($45,119) | ($45,119) | ($45,119) | ($45,119) | |
| Net Cash Flow | $154,257 | $194,502 | $224,436 | $265,355 | $310,736 | |
| Cash at Beginning of Period | $0 | $154,257 | $348,760 | $573,195 | $838,550 | |
| Cash at End of Period | $154,257 | $348,760 | $573,195 | $838,550 | $1,149,286 |
Mental Health Private Practice Business Plan FAQs
What Is a Mental Health Private Practice Business Plan?
A mental health private practice business plan is a plan to start and/or grow your mental health private practice business. Among other things, it outlines your business concept, identifies your target customers, presents your marketing plan and details your financial projections.
What are the Main Types of Mental Health Private Practice Businesses?
There are a number of different kinds of mental health private practice businesses, some examples include: Cognitive Therapy, Behavioral Therapy, Holistic Therapy, and Interpersonal Therapy.
How Do You Get Funding for Your Mental Health Private Practice Business Plan?
Mental Health Private Practice businesses are often funded through small business loans. Personal savings, credit card financing and angel investors are also popular forms of funding.
What are the Steps To Start a Mental Health Private Practice Business?
Starting a mental health private practice business can be an exciting endeavor. Having a clear roadmap of the steps to start a business will help you stay focused on your goals and get started faster.
1. Develop A Mental Health Private Practice Business Plan - The first step in starting a business is to create a detailed mental health private practice business plan that outlines all aspects of the venture. This should include potential market size and target customers, the services or products you will offer, pricing strategies and a detailed financial forecast.
2. Choose Your Legal Structure - It's important to select an appropriate legal entity for your mental health private practice business. This could be a limited liability company (LLC), corporation, partnership, or sole proprietorship. Each type has its own benefits and drawbacks so it’s important to do research and choose wisely so that your mental health private practice business is in compliance with local laws.
3. Register Your Mental Health Private Practice Business - Once you have chosen a legal structure, the next step is to register your mental health private practice business with the government or state where you’re operating from. This includes obtaining licenses and permits as required by federal, state, and local laws.
4. Identify Financing Options - It’s likely that you’ll need some capital to start your mental health private practice business, so take some time to identify what financing options are available such as bank loans, investor funding, grants, or crowdfunding platforms.
5. Choose a Location - Whether you plan on operating out of a physical location or not, you should always have an idea of where you’ll be based should it become necessary in the future as well as what kind of space would be suitable for your operations.
6. Hire Employees - There are several ways to find qualified employees including job boards like LinkedIn or Indeed as well as hiring agencies if needed – depending on what type of employees you need it might also be more effective to reach out directly through networking events.
7. Acquire Necessary Mental Health Private Practice Equipment & Supplies - In order to start your mental health private practice business, you'll need to purchase all of the necessary equipment and supplies to run a successful operation.
8. Market & Promote Your Business - Once you have all the necessary pieces in place, it’s time to start promoting and marketing your mental health private practice business. This includes creating a website, utilizing social media platforms like Facebook or Twitter, and having an effective Search Engine Optimization (SEO) strategy. You should also consider traditional marketing techniques such as radio or print advertising.