Owning your own business comes with many unknowns but when you decide to expand to group practice, the amount of uncertainty increases significantly. Without the proper preparation, certain situations can become nightmares for group practice owners. Even though we hope you never experience worst-case scenarios, we wanted to highlight some of the most common in order to prepare you.
External and regulatory problems
Audits –
There are several types of audits but the ones we are referencing specifically are related to health insurance. This happens when an insurance company conducts an investigation to ensure the claims that were submitted are accurate or to determine if the services that were provided were required or justified. Even if your practice is private pay, you could still be subject to an insurance audit if a client submits a claim using their out-of-network benefits.
Avoiding this includes completing timely documentation, diagnosing appropriately, justifying symptoms and progress toward treatment goals, and entering the appropriate code on the claim form. This way, even if there is an audit, you can be confident that no issues will be identified.
If an issue is identified, possible outcomes could include a chart review, clawback, penalty/fine, increased scrutiny, corrective action plan, or risk to your practice reputation.
Privacy breaches –
Privacy breaches occur when protected health information (PHI) is acquired, accessed, used, or disclosed in an impermissible way, compromising its security or privacy and posing a risk of harm to the patient. The more clinicians you have in your practice, the more likely it is for a breach to occur. It is important to ensure that all staff understand the importance of confidentiality and that all of your technology is HIPAA compliant.
Some ways to avoid privacy breaches include mandating HIPAA training for all staff, developing policies for staff, limiting access of PHI to only the staff that need it, and conducting internal audits. We recommend Hushmail for encrypted email and Ring Rx for HIPAA compliant communication.
If a privacy breach occurs, notifying the client and your liability carrier are common first steps. Possible outcomes could be loss of trust or legal penalties.
Subpoenas/Lawsuits –
Depending on what your client population is, you may be more or less likely to encounter this particular problem. If you work with court mandated clients or work with a lot of couples therapy and individuals going through divorce, you could be contacted by lawyers to subpoena your records or request that you testify in court.
Having a relationship with a reputable attorney who specializes in risk management and having the ability to consult with them can be helpful. If you ever do receive a subpoena or are sued, contacting your liability carrier is typically the first step and they will provide guidance and an attorney if necessary.
Ensuring that you maintain malpractice insurance with adequate coverage, maintaining thorough and accurate documentation, following legal/ethical guidelines, and establishing policies and using appropriate consent forms can all be helpful preventative measures.
Failing to respond to an subpoena can result in a strained relationship with your client, professional consequences, court contempt, or legal penalties. If you are sued there can be associated legal costs, scrutiny from the licensing board, emotional/professional stress, and a negative impact on your reputation.
Licensing board complaints –
Because it is so easy for anyone to file this type of complaint, it is important to always document decision-making rationale, remain within your scope of practice, maintain appropriate boundaries with clients, handle client dissatisfaction proactively, and follow legal and ethical guidelines.
If a licensing board complaint is filed against you, an investigation is likely to occur and possible outcomes could be probation, fines, mandatory training or remediation, or a suspension or revocation of your professional license.
Where Can I Get Guidance?
Julia will be providing a free webinar about these exact topics on Tuesday, the 23rd of September, 2025 at 12pm EST. Not only will she be covering these issues, but also more that we’ll be covering next week in a blog post.
Consider Us
Compassionate Consulting Company has consultants that are prepared to help you at any stage of your business journey-whether you are just starting out, expanding your team, or looking to diversify or develop leadership skills. Here are testimonials from clients that have worked with us. Schedule a free consult so we can learn more about your business goals and share how we can help. Here are the steps of working with a consultant, what to look for in a consultant, and ways a consultant can help you achieve your business goals. We are here to help you avoid these mistakes in order to ensure your practice is impactful, profitable, and sustainable!
