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“It was reclaiming the reasons I went into medicine, specifically dermatology,and making sure the quality of personalized care matched my expectations”
~ Dr. Alyssa Dean, MD, FAAD, Dermatologist and Founder of Remedy Skin, Hair and Wellness

Starting a new dermatology practice is both exciting and challenging and with the right planning, it can be a highly profitable business for years to come.

For some, it’s about leaving the traditional model of medicine and pursuing a more personalized approach to dermatology. For others, it’s about wanting to focus on an evolving specialty and growing a career that supports that particular goal.

And whether you're looking to fly solo or partner with other physicians, there are certain criteria to put in place so your dermatology practice is on track for revenue growth from Day One.

You'll need to consider a broad spectrum of startup items from overhead costs, revenue generation and hiring, to workflow solutions and legal compliance.

However, the process doesn't have to be overwhelming. Stay organized and on track by using our list of the most important items to put in place when you’re preparing to start a new dermatology practice.

1. Laying the Legal Foundation

Set up a rock-solid foundation for your new business by covering all the legal bases first.

Check with your state, county, and city governments to make sure you have the correct licensing, certifications, and insurance coverage to legally operate a dermatology practice in your area.
You will also need to choose provider networks to participate in. Be sure to contact them to get the credentials they require you to have.

Obtain a tax ID number, open a business bank account, and get your financial documentation in order. If your startup budget is too lean to hire an accountant, learn the tax codes in your state, county, and city and keep up-to-date accounting records.

Getting all of the required documentation put in place might not be the most exciting part of starting a new dermatology practice, but taking the time to get all of the legal items crossed off your list first will set your practice up for ongoing success.

2. Determine the Cost

A startup dermatology practice requires money to run. It doesn’t matter if you are using personal savings or a business loan, you want to create a budget and be sure it aligns with the growth goals outlined in your business plan.

Factor in all of the major costs for items like office space, furnishings, equipment, staffing, insurance, and marketing. Determine how you're going to handle the billing and collection process for your services. Will it be more affordable to outsource some tasks or handle them in-house?

Most importantly, don't forget to calculate how much money you will need for your living expenses while you get the business up and running. It can take at least several months for a new dermatology practice to be truly profitable. Be sure to build a financial cushion for yourself into the budget.

3. Office Space and Equipment

When considering where to locate your dermatology practice and the amount of space required for growth, you want to figure out how much of your budget you can safely allocate to filling that office space. Luckily, there are ways to keep these costs manageable.

As with any new practice, your patient roster will be small at first, so don't furnish every examination room or hire a full staff. Wait until your patient roster has grown and you have the income to meet the demand for increased services.

Another good way of keeping expenses down is to consider leasing medical equipment instead of buying it. Initially, choose devices that are used for the most commonly treated skin ailments. Why? Because during the startup period, you'll be getting to know your patient population and the types of skin conditions that are most prevalent in the area you will be servicing. You don't want to spend money up front on expensive lasers and light boxes only to discover the need for them doesn't justify their cost.

Growth is easier when you make smart decisions about where to spend your money while building a new practice. Learning what services your new patients consistently ask for will help you make smarter purchasing/leasing decisions in the beginning and give you some financial breathing room.

4. Office Software

The EHR (Electronic Health Records) software you choose needs to be efficient, user-friendly, and compliant because everyone in your dermatology practice will be interacting with it.

For example, you'll use it to make notes and diagrams during patient visits. Your staff will use it for record-keeping, appointment setting, and billing. And your patients will be connecting to it for appointment reminders and information.

When choosing an office software system, consider one that will not only adapt to your office workflow, but will offer ease of use for patients who might not be as technically savvy as you and your staff. The best EHR software will actually increase business growth by creating a positive patient experience for everyone involved.

5. Hiring

Until your practice starts generating revenue, you want to hire the staff you need on day one, not the staff you envision 5 years down the road.

In the beginning, you might be seeing only a handful of patients a day so a fully staffed office doesn’t make sense. You’ll end up spending financial resources that in the startup phase of business are better spent on marketing your new practice to the surrounding community.

That being said, a key position to consider filling before you open your doors for business is that of the office manager. This will be your go-to person for keeping everything and everyone organized while you are getting your practice up and running.

As your dermatology practice gains new patients and revenue increases, hiring additional staff at all levels will increase your bottom line, not detract from it.


Starting a new dermatology practice is an exciting time. It gives you the opportunity to pursue specific career goals that working for someone else might not offer. The good news is that it doesn’t have to be overwhelming. Create a checklist and use it as a roadmap to help you stay organized and on track.

Cover all the legal bases for state, county, and city so that you are in complete compliance. Know your budget and stick to it. Spend only on the equipment and staff that the business requires to run efficiently on day one. And last but not least, make sure you can cover your personal expenses. You don’t want to spend time worrying about paying your rent.

With the right planning in place, a new dermatology practice can turn into a highly profitable business for years to come.

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