Do you want to start a private occupational therapy practice? If YES, here is a complete guide to private occupational therapy business with NO money and no experience. The private occupational therapy business involves promoting clients’ functional independence skills in all aspects of their lives. Private Occupational therapy is a growing business in the united states especially with the increase in the rate of baby boomers in the country.

Another motivating factor is that there is less competition in the industry, giving access to more clients and income. It is also a great business because you are able to combine it with physical therapy services which is another high-demand service and that gives room for multiple streams of income for you. If you are looking for resources to start your private occupational therapy business in the United States, this article contains valuable information to help you start.

14 Steps to Starting a Private Occupational Therapy Practice Business

1. Understand the Industry

The private occupational therapy industry in the United States is a $20 billion dollar industry with an annual growth rate of 1.1% and an estimated future growth rate of 1.9% between 2016 and 2021. This is according to a research report by IBISWorld.

The report also revealed that there are about 23,920 businesses operating in this industry with about 118, 281 people employed. The high growth rate in the industry is attributed to the burgeoning baby boomer population who require occupational therapy to be able to manage age-related ailments.

Interesting Statistics About the Industry
  • According to research reports, private occupational therapy is a $20.1 billion dollar industry in the United States
  • Revenue in the industry increased by 14% between 2011 and 2016 while employment rates increased by about 19%
  • Revenue growth rates are expected to continue rising at an average of 3.6% per year through to 2021
  • In 2016, the average annual income for an occupational therapist was estimated to be $78,000
  • At least 60% of all occupational therapists offer private services to clients alongside working in a public or private paid employment
  • According to a research by the American Occupational Therapy Association (AOTA), 86% of occupational therapy graduates receive their first job offer within three months
  • The Bureau of Labor Statistics has released a projected 29% rise in employment in the industry through 2022.

The occupational therapy industry in the United States is a growing one primarily due to the fact that occupational therapy is increasingly being added to health care plans across the country. There is also a rise in the number of baby boomers in the country who require assistance with rehabilitation and easier living and day to day survival.

Americans are also becoming more health conscious and this has led to more people taking interest in services that are believed to boost general health and reduce medical costs eventually.

2. Conduct Market Research and Feasibility Studies

  • Demographics and Psychographics

In the United States, occupational therapy clients are divided into three major categories which include children, senior citizens and adults. About 30% of occupational therapy clients are children who require help with mental, cognitive, physical, health, school performance and socialization challenges.

Another 50% of the clientele are made up of older Americans. These adults require help with maintaining a certain level of independence in their lives as they age. They also require services that would help to improve strength and regain some life supporting skills that would help them live as long as possible.

20% of clients are essentially made of adults who require rehabilitation therapy after accidents, injuries or other life altering events. Some organizations also require the services of occupational therapists to act as consultants in areas covering ergonomics, rehabilitation and wellness.

3. Decide Which Niche to Concentrate On

According the Association of Occupational Therapists, there are six key practice areas in the occupational therapy field and you can choose various niches within any of the categories:

  • Work and Industry

New technology at work, aging workforce.

  • Children and Youth

Driving for teens, broader scope in school, bullying, childhood obesity, transitions for older youths.

  • Rehabilitation and Disability

Telehealth, autism in adults, new technology for rehab, hand transplants and bionic limbs, veteran and wounded warrior care, cancer care and oncology.

  • Productive Aging

Community mobility and older drivers, Alzheimer’s disease and dementia, aging and home modifications, low vision.

  • Health and Wellness

Obesity, chronic disease management, prevention.

  • Mental Health

Veteran and wounded warrior treatment and support, depression, recovery and peer support, sensory approaches to mental health.

The Level of Competition in the Industry

There are hundreds of clients offering physical therapy services in the United States and this makes it a less desirable business enterprise than occupational therapy. This is why occupational therapy is a less competitive business industry and there is more scope for developing regular clients and earning more income.

There are also fewer professionals practicing occupational therapy compared to physical therapy and with the increase in geriatric population; the ratio of clients to occupational therapists is a very high one.

4. Know Your Major Competitors in the Industry

There are a number of occupational therapy clinics in different states across the United States. Some of the most popular ones include:

  • Centra Pediatric Therapy
  • High Five Hand Therapy and Rehabilitation
  • Hands on Hands Rehabilitation Center
  • Behavioral Health Works
  • Orange County Speech Services
  • California Therapy Solutions
  • CornerStone Therapies
  • Rock Institute
  • Maximum Therapy
  • California Rehabilitation & Sports Therapy
  • Communikids, New York
  • Astoria Occupational Therapy
  • Carlyn H., San Diego
  • Developmental Occupational Therapy, Sacramento
  • Skills on the Hill, Washington, D.C
  • Body Connect Health & Wellness, Washington
  • Pamela Lawton, Brooklyn, NY
  • Focus Occupational Therapy
  • Benjamin Pediatric Therapy, Los Angeles
  • Kids at Play, Philadelphia
Economic Analysis

According to a report published by the Bureau of Labor Statistics, demand for occupational therapy services is expected to increase at a rate of 27% from 2014 to 2024.

Demand for occupational therapy services would also increase due to the number of patients suffering from autism spectrum disorder. Occupational therapy services would be needed to assist children who suffer from this condition to improve their social skills and complete a variety of daily tasks independently.

Health insurance companies are also adding occupational therapy to packages offered to clients and this is also expected to drive the demand the occupational therapy services through the roof over the next few years as more clients are able to afford these services.

5. Decide Whether to Buy a Franchise or Start from Scratch

The best way to start a private occupational therapy practice is to start from the scratch. This is usually more affordable than buying an existing business. It would also enable you to build your own reputation as a professional, and develop your own clientele. This is way better than riding on another professional’s reputation or achievements.

However, if you are looking for a way to get more clients easily and reduce start-up expenses, you can consider teaming up with a physical therapy business. This way, you would be able to share the expenses and resources so that starting the business becomes more affordable.

6. Know the Possible Threats and Challenges You Will Face

One of the major challenges of starting this nature of business is getting the required certification. Unlike most businesses, this is a business that only certified professionals can practice so if you do not have the required educational requirements and certifications, you may not be able to venture into this type of business.

Getting clients is another start-up challenge for private occupational therapy businesses because it is still a growing field and many people are unaware of the necessity and benefits of this service. You may have to spend ample time convincing and educating clients as to why they require your services.

7. Choose the Most Suitable Legal Entity (LLC, C Corp, S Corp)

There are many business forms that your private occupational therapy practice can take ranging from sole proprietorship to a corporate practice with shareholders. You would have to look into the laws of the state in which you intend to set up your practice to find out what the rules and regulations are. However, some of the business entities that you can choose include:

  • Sole Proprietorship

This is the cheapest and most convenient way to set up your private practice. This means that legally, the occupational therapist and the business are one and the same. You can set up the practice under your own name or an assumed name.

However, you must understand that the profits you derive from the business would be treated and taxed as personal income. You would also have full control over the way the business is operated but this also means that you are fully liable for all the business liabilities.

To register your private occupational therapy business as a sole proprietorship, you would have to file a certificate of conducting business at the local county clerk’s office.

  • Partnerships

You can set up a joint practice with another therapist. This type of business structure is called partnership. Both of you would have to share profits and have joint control over the affairs of the business. You would also be jointly liable for all the expenses and debts of the business.

Before you can set up your practice as a partnership however, you have to look into the laws of your state to see if the laws allows for partnerships between professionals of “unlike professions” such as private therapists and occupational therapists because many states prohibit this.

  • Corporations

If the laws of your state permit it, you can set up your business as a professional corporation. Some states would usually require that the shareholders of professional corporations are licensed to practice the profession. This means that to set up your occupational therapy practice as a corporation, your shareholders would have to be licensed occupational therapists too.

These are the best and most common legal entities used to set up private occupational therapy businesses in the United but you can also explore some of the other business structures such as Limited Liability Company (LLC), Professional Limited Liability Partnership (PLLP) or Professional Limited Liability Company (PLLC).

8. Discuss with an Agent to Know the Best Insurance Policies for You

As a private occupational therapist, you would have to meet with different patients on a daily basis and even though you are a pretty good therapist, it is important to prepare for some events that may jeopardize your career. Taking out the necessary insurance policy coverage can help you achieve this.

Some of the insurance policies that you would require for this business include:

  • Professional Liability Coverage

This would cover for you and your business in cases of claims of negligence or professional liability.

  • License Protection

If a patient makes a compliant about you or your business to the State Licensing Board, you may have to incur costs running into thousands of dollars to defend your practice. This type of insurance would cover for such costs.

  • Defendant Expense Benefit

Defendant expense benefit covers for losses made and expenses incurred when attending legal proceedings as a defendant in a covered claim.

  • Personal Injury Coverage

This type of insurance policy covers for claims arising from allegations of slander, assault and battery and other alleged personal injuries arising due to performance of your professional services.

  • Information Privacy Coverage

This covers you for claims of violation of confidential personal information.

9. Get the Necessary Professional Certification

You would be required to fulfill a number of professional requirements before you can be granted a license to set up a private occupational therapy business in the United States. Some of them include:

  • Accredited Occupational Therapy Educational Program

First, you would need to graduate from an accredited occupational therapy educational program and complete fieldwork requirements.

  • NBCOT Certification

Next, you would have to take and pass the examinations conducted by the National Board for Certification in Occupational Therapy (NBCOT).

  • License

Lastly, you would have to apply for a license in the state in which you wish to practice your profession. It is important to obtain a copy of the state licensure law from your state’s licensing board in order to fully understand all the licensing laws you are expected to comply with in order to avoid being penalized.

10. Get the Necessary Legal Documents You Need to Operate

The first document you would need for this business is a detailed business plan as this would provide a blueprint for conducting the business. Other documents include:

  • Federal Income Tax Compliance documents
  • Federal Payroll Tax Compliance documents
  • State Taxes Compliance Documents
  • National Health Provider Identification Number (NPI)
  • Insurance Policy Documents
  • Professional Certifications
  • Welcome Letter
  • Disclosure Statements
  • Consent to Treatment
  • Termination Letter
  • Disaster Planning
  • Social Media Policy
  • HIPAA Notice of Privacy Practice
  • Professional Will

11. Raise the Needed Startup Capital

You would need a lot of funds to set up your private occupational therapy practice.  This would cover for a number of start-up costs and day-to-day expenses.

Some of the ways through which you can raise funds to cover up some of these costs include:

  • Partner with Another Therapist

You can cut the costs required to start your private occupational therapy business in half by partnering with another therapist. This can be done in two ways; you can partner with another occupational therapist and set up your business as a partnership so that you can both share the start-up costs in half. The alternative way to go about this is to partner with a physical therapist. You can talk to a physical therapist about setting up your business within the same location so that the cost of setting up the business is significantly reduced.

  • Personal Savings

If you have some personal savings stashed up somewhere, there couldn’t be a better time to dig into these savings. You can even use your retirement savings to set up the business under the Rollover as a Business Startup agreement.

  • Home Refinancing

If you have built up equity in your home, you can consider taking up a second mortgage on your home so that you can have enough cash to pump into your private occupational therapy practice.

  • Credit Cards

Your personal credit card can go a long way in helping to pay for some of the supplies you need for the business as well as some of the day to day expenses you would need to undertake.

  • Traditional Loans

If you have a good credit score, you can consider the option of obtaining loans from the bank or other financial institutions.

  • Line of Credit

If you need short term working capital, opening a line of credit might be your best bet.

  • Crowdfunding

You can also consider going on crowdfunding platforms to seek for funding for your business. Some popular crowdfunding platforms include Kickstarter, Indiegogo and GoFundMe.

  • Grants

You can also visit websites like grantswatch.com to find out about grant programs available for your business.

12. Choose a Suitable Location for your Business

Before you choose a location for your business, there are a few considerations you would need to make because your location can make or break your business.

  • First, you have to consider zoning laws and ascertain whether you are allowed to situate such a business in your preferred location.
  • You should also consider accessibility to your office especially if most of your clients are baby boomers. The parking lot should be easily accessible from the clinic and the same thing applies to the rest rooms.
  • You should also consider your spacing needs especially if you don’t like the idea of moving your business to another location as your business expands.

13. Hire Employees for your Technical and Manpower Needs

You would need a number of equipment and tools to start your private occupational therapy business. Some of them include:

  • Office equipment such as phones, printers, fax, copiers, computers, internet, credit card machines, business software
  • Marketing materials
  • Office furniture
  • Clinical Equipment such as tape measurers, stationary bikes, medicine balls, treatment tables, wheel chairs, stools, mirrors, stackable steps, etc.

As for manpower requirements, you can start as a one-man practice but as your business grows, you would require occupational therapist assistants, receptionists, marketing officers, business managers, nurses, accountants, office assistants and security guards.

14. Write a Marketing Plan Packed with ideas & Strategies

Finding and keeping the right clientele is very important after setting up your private practice. Without this, all the hard work you put in would have been for nothing.

You should start by creating a business marketing plan for your business. Some of the marketing ideas and strategies that you should include in your marketing plan include:

  • Building Your Online Presence

It helps to create a strong online presence for your business by:

  • Creating a highly search engine optimized website for your business.
  • Creating a strong social media presence for your business.
  • Blogging as a way to educate potential and existing clients about how your business can help to improve their performance and the quality of their lives in general.
  • Organize Awareness Programs

Occupational therapy is still a grey area for many. Many people are unaware of the existence of such practices and the importance and benefits it can offer them. You can organize talk shows, road walks and awareness programs that would increase knowledge and visibility for your business.

  • Create a Referral Reward Program

You can also consider setting up a program that offers rewards to clients who are able to bring in new clients to your business. Rewards could be financial or monetary.

  • Use Traditional Marketing

Traditional advertising strategies such as television and radio advertising, newspaper and magazine adverts, fliers and door to door advertising are also very effective marketing strategies that you can use to promote your business.

Conclusion

Occupational therapy is a relatively new business idea with a lot of growth potentials over the next few years. If you are able to overcome the hurdles of getting the required certification, you would find the business a very easy and lucrative one to set up.

Ajaero Tony Martins