3 Myths About Building an Independent Advocacy Practice

Posted by:

The real shame of this new series of posts is that it’s the result of feedback from people who gave up on their dreams of starting and growing independent, private advocacy practices.

The further shame is that all those patients who they might have helped will not get their help, and may never get what they need from the healthcare system.

Over the years, hundreds of people have come and gone in our profession. My educated guess: for every 10 who take the early steps toward fulfilling their dreams, only 2 or 3 have succeeded. Further, the people one might expect would be the successes have, instead, given up.

Why do so many walk away? Because before they started, they assumed things about starting and growing an independent practice that just aren’t true, usually without realizing they had made an assumption.

So that’s our topic for the next few posts: The myths that too many advocate wannabes buy into, eventually forcing them to walk away from their dreams.

We’ll begin with the first 3:

Myth #1: Advocacy is just a service, so since I already know how to be an advocate, it won’t cost me anything to get started.

If you think of advocacy as sitting in a home office, talking on your home phone, and doing research on your personal computer, then you’re right, it doesn’t cost you much of anything.

But that’s not what advocacy is. And doing no more than that sets you up to fail.

Building a successful advocacy practice requires us to set the stage for being successful. It’s about investing in yourself to support your success. Start-up costs include marketing (including a website), developing financial processes (possibly hiring an accountant), obtaining liability insurance (which may cost you thousands of dollars), joining one or more professional organizations, and more.

And if you think “do it yourself” means it’s free, think again. Succeeding means you understand and embrace the concept of “time is money.” If you’re spending time doing administrative tasks, then you aren’t working with a paying client. If you don’t have enough paying clients, then you need to do marketing. All that costs you time and money. Opportunity cost is opportunity lost.

Starting an advocacy practice incurs a fair amount of expense, make no mistake. There’s nothing free about it.

Find a list of all those aspects of advocacy you must plan for
and how to get them done,
in The Start and Grow Your Own Practice Handbook.

Myth #2: I’ve been an advocate all my life. Now I want to get paid for it!

I hear this repeated, mostly by nurses who are tired of working in hospitals or large doctor practices, who think independence will let them be the advocates they want to be. Over time the system has devalued their advocacy, and that frustrates them immensely (as it well should!)

On one hand, they are right. Being independent WILL allow them to be the advocates they want to be – incredibly rewarding!

But “learning to get paid” isn’t a magic switch. It’s only a small part of building a profitable business, only one of many skills to learn. Among the others are estimating, contracting, time tracking, and invoicing – and those are just the money skills. How will clients even find you? How will you figure out what they need? How will you learn the aspects you don’t already know? Etc.

Thinking one only needs to learn to get paid for advocacy is based on an assumption that the grass is greener on the independent side, without understanding the road full of challenges one must take to get there.

Find more information about getting paid for advocacy
in The Start and Grow Your Own Practice Handbook.

Myth #3: I can’t believe how much I can charge for my services. I’ll make so much money being a self-employed advocate!

For those who can successfully self-employ themselves, there are great ways to parlay their efforts into a substantial income. It takes some time, but it’s certainly do-able. The beauty is that their income becomes a direct reward for their efforts. The more work, creativity, and effort, the more income. That’s not true for people on a salary. No matter how much effort they put into their jobs, their paycheck is the same. (Salaried people don’t usually get overtime pay.)

However, employed income and self-employed income are two very different things. If you equate them before you start, you’ll find yourself going into debt to pay your bills.

Further, a salary usually has benefits associated, too, making that salary higher than it might initially sound. In the US, the estimate is that benefits cost an employer an additional 30%, so a salary of $50,000 really equates to an income of $67,000!

When you are self-employed, your “benefits” are of your own choosing, depending on what you’re willing to pay for. The cost of health insurance may need to come from that $50,000.

An employed person has Medicare and Social Security withheld at a rate of about 7.5%. But self-employed people pay Medicare and Social Security twice – because they are both the employer and the employee, totaling approximately 15% of their income.

There are still further variations because self-employed people can deduct so many expenses from their taxes.However, using just our math above and no other factors, initially a $50,000 employed salary quite a bit more money than a $50,000 self-employed income. (And then there is this confusion: much of this will change in the US in 2018 with the new tax law.)

You’ll need to factor in this, too: that as a self-employed person, you have two kinds of work; work you do get paid for (billable time), and work you don’t get paid for (non-billable time.) Client time is mostly billable and you can earn a lot of money (range = $100 to $250/hour). But early in your practice, you’ll spend up to 80% of your time doing admin work, marketing, etc – all of which is all non-billable.

Ask yourself whether you can afford to be paid for only 20% of your time and still pay your bills and subsidize your own benefits.

Finally, don’t forget cashflow. With a salary, you get your paycheck on a regular schedule (every week, every two weeks, whatever)… but as a self-employed person, you get it in spurts. You might make $10,000 this month, but only $1,000 next month. You have to learn to manage cashflow – the timing of how money comes in and goes out – then budget for the highs and lows to take care of your bills.

Suffice it to say that no matter how you look at it, getting a paycheck, and earning money as a self-employed person does not make the numbers equal. It takes much more planning and discipline to be self-employed (but OH! how the rewards can be worth it!)

Learn more about figuring out how much to charge,
how much money you can make, and managing cashflow
in The Start and Grow Your Own Practice Handbook.

So there are the first three myths about building an independent advocacy practice…. stay tuned next week for a few more.

 

This series:

 

LEARN ABOUT APHA MEMBERSHIP | MORE REASONS PATIENTS NEED ADVOCATES | MASTER LIST OF PRACTICE RESOURCES

 

You might also be interested in:

1

Comments

  1. Todd Meyer  January 15, 2018

    Good topic and well said…

    reply

Add a Comment