Empowering Dermatologists: Exploring Entrepreneurial Ventures
In recent years, dermatologists have increasingly ventured into entrepreneurial activities, seeking to augment income and diversify skills beyond traditional clinical duties. Whether affiliated with institutions or managing private practices, these professionals are embracing side businesses to explore entrepreneurial interests and enhance their financial stability. This trend highlights important strategies for dermatologists considering such paths.
Understanding the "Doctorpreneur"
The term "doctorpreneur" applies to physicians who pursue business ventures or supplementary income streams outside their main medical practices. These initiatives range from launching start-ups to forming limited liability companies (LLCs) and undertaking additional contract work. Such endeavors fall under the broader scope of doctorpreneurship, offering diverse business opportunities.
Building a Strong Professional Brand
Drawing on over 25 years of experience advising more than 1,500 physicians, key insights are shared in resources like the "Wealth Planning for the Modern Physician Podcast." Orthopedic surgeon Michael Ast, in a 2021 podcast episode, emphasized the significance of excelling in clinical responsibilities while nurturing a professional brand. Establishing a strong professional reputation involves developing relationships with referring providers, engaging with the community, and collaborating with industry partners for market insights.
Navigating Legal and Regulatory Compliance
For those pursuing external business activities, understanding legal and contractual obligations is essential. Reviewing employment or partnership agreements is critical, particularly if professionals lack practice ownership. Consulting a healthcare attorney specializing in physician contracts is invaluable in mitigating legal risks during the venture's nascent stages, ensuring compliance with regulatory requirements.
Structuring Ventures to Mitigate Risk
Preventing liability exposure is paramount. Establishing a separate LLC can protect against potential liabilities. Adequate insurance coverage, like property and casualty policies, shields both personal and practice assets. Tailored policies—including medical malpractice insurance for moonlighting roles or landlord-type policies for real estate investments—highlight the importance of collaboration with experienced insurance advisors.
Optimizing Financial Structures
Considering the financial structure of these ventures is crucial for maximizing tax efficiency and asset protection. Depending on liabilities and income, entrepreneurs might choose to report earnings directly or establish a legal entity. Exploring retirement plans, either qualified or nonqualified, facilitates tax deferral and asset protection, enhancing long-term financial planning.
Author David Mandell, JD, MBA, a seasoned attorney and OJM Group partner, offers guidance on navigating the complexities of entrepreneurial ventures for dermatologists. For further assistance, contact him at 877-656-4362 or mandell@ojmgroup.com. This article provides a general overview; consulting tax and legal professionals is recommended for personalized advice. OJM Group is an SEC-registered investment adviser compliant with state-specific registration requirements. Regulatory information is available at adviserinfo.sec.gov.