California Med Spa dreaming...

awalikraam · May 31, 2013

Hello I know this post is old but just wondering how things are fairing with your medspa? My friend and I are both RN's and want to start our own business as well. I would love to "pick your brain" on finding and compensating a medical director...please contact me if you are interested in sharing some of those nuggets of wisdom...Thanks!

CantDecideUsername · Jul 2, 2014

I'm interested in this as well..

NedRN · Jul 5, 2014

I have a very close friend (old recurrent college girlfriend to be more precise) who is a struggling pediatrician. Heck, most pediatricians are struggling - I make more than many of them with fewer hours and stress as a travel nurse. While practicing in Indiana, she was offered quite a lot of money for very limited work as a medical director for a nurse already in business in California where she continued to hold a license (internship there). No mention was made of any ownership criteria. She declined for reasons frankly incomprehensible to me, she believed that such medical directors were held in low esteem by their colleagues (not sure how pediatricians anywhere would find out her involvement in such clinics). I think being able to afford braces for your children is more important than pride, but clearly my priorities are misplaced.

Anyway, I got a clear idea that being a medical director is easy money (I'd have to do a serious search for old emails to dig up more details), so I doubt that would be a major roadblock in developing a clinic. Capital expenditures on offices, lasers and such, salaries, and marketing are the main hurdles - it takes money to make money in many business models. Not travel nursing though.

NedRN · Jul 5, 2014

I found the emails. Here's a summary I made for my friend back in 2006:

I talked to Mary for about half an hour. She has been operating medical
weight loss clinics for many years in conjunction with an NP who orders
necessary lab work and prescriptions. At one time, she was netting $50,000 a
month from this business. Currently, net profit is around $5,000 a month
after all costs. The current physician will be out in about three months so
that can be yours then ($30,000 a year).
She is currently changing her business model from individual appointments to
an automatic monthly debit similar to gyms. She believes that this will help
to motivate patients to come in more often and possibly triple or more the
revenue. At any rate, she has proven her success in this business.
What she is currently doing is starting up a botox clinic and has the space
in her current offices. Mary thinks that that will be best set up as a joint
venture with you as partner (non financial). No income yet as it has not
started. The NP would be doing the injections - quite low risk, temporary
action so lawsuits are very rare. And these two have never had a lawsuit.
Mary said a number of years ago that she spent some $40,000 on legal fees to
develop contracts. But it ended up that she and the physician decided that
that was enough and you have to operate on trust. I brought up the contract
issue but in my experience she is right. You can have a great contract, but
without trust it is not worth much. Her current physician does not have a
formal contract.
Technically, CA medical board has oversight on this kind of business. In
fact, they have no proactive oversight - no inspectors, no regulations that
they would even know who the medical director is. Only if there is a problem
would Mary even have to identify the medical director. There certainly are
some grey areas, but it looks like with a valid CA license and address, you
could start legally in Indiana without any problem.
I think it says something for Mary's business ethics that she even has a
medical director as it would be easy to skip it.
I'm not suggesting that you do this but I probably would in your situation.
Just like no one is notified who their medical director is (other than
presumably clients), there is no check on physician malpractice insurance -
no one to tell (there is insurance covering Mary's and the NP's practice).
If you don't do the insurance, it is all found money.
Mary knows what her current physician is paying, $15,000 a year and he
covers five such clinics. (She thinks that is cheap compared to revenue).
She thinks that you could just inform your existing insurance company and
they would be unlikely to charge more.
I did explain your situation and said that was unlikely to happen though.
Mary sounds like she would be thrilled to have you on board. She is talking
to a couple other physicians this week, but would like to have a woman. It
also sounds like her current doc is too hands off so she wants someone with
some interest but not too much!
No telling how well the botox side will do. I said it seemed unlikely that
there would be much spillover from current clientele - after all fat people
don't have much in the way of wrinkles. She said that there would be
spillover. Their average client is only 50 pounds overweight.
She suggested that if possible that you visit so you can see how respectable
the whole setup is. I think that is a great idea! Buzz out there and visit
your sister for a couple of days. Possibly set up some pediatric interviews.
If you need help with plane tickets, just ask.

NedRN · Jul 5, 2014

I see some issues with grammar and wording in that old email that may confuse some issues, but hopefully you all get the gist of it. Other than clearing up grammar, everything I know about the subject is in that summary so I doubt I would be able to answer any follow up questions about medical directors.

NedRN · Jul 5, 2014

This email will also be of interest:

Thanks so much for being the "inbetween."
If you can give me the physicians phone # and best time to call her so she
can speak privately with me, I would be more than happy to explain our
business plan to her. You can also forward this email to her.
Basically, I have an adorable Victorian building which I lease right off the
main street in xxxxxxxx, California. We have a weight loss center here and
have been successful for the past 10 years. The physician that has worked
with me is "semi-retiring" and no longer will be working with us. We have
had a superb professional relationship and he has the utmost respect for my
work. I am explaining this to you so the physician friend you have does not
think there are any negative feelings and we are parting in a less than
favorable manner! Everything is on the up and up with this physician.
Here is the position I am in. I have access to hundreds of weight loss
patients and have spoke with numerous nursing friends that are in the
nursing esthetician business. They are all telling me the same thing "I love
doing botox/fillers in the skin clinics, my Drs. come in once a month for
meetings with the staff and to sign 10% of the charts and they are making a
lot of money and they do not have to be on-site daily". Phone supervision is
legal in California. I think we are only 2 states that allows this. I know,
to an out of state physician, this might sound " a little shady" but in
reality, in California, it has been done safely and effectively. The
physician I work with, has been doing this for years and has never had a
malpractice suit filed against him (or me and my nurse practioner!)
I have a nurse practitioner that is trained in botox/fillers so I am
starting a new company called " Northern California Weight/SkinCare
Consultants. I am looking for a physician to be our "medical director,"
which consists of over seeing policy and procedures (which we have), being
available for phone supervision (which would not be often ) and sign off on
10% of charts which we could fax to her, supply malpractice insurance (we
could get it for her but since she would be receiving 51% of the profit, she
would have to pay for that from her profit. I am guessing, she would have to
pay the 1st quarter until we start to make a profit, which would be very
soon! My nurse practioner will have her own. She has practiced for 34 years
and is very safe and compassionate and has never had a suit filed against
her.
If this arrangement worked out well, then we could explore expanding our
center to a "med spa" The physicians in this area are netting $250,000 per
year after a couple years and that is without having to spend much time in
the office. I have plenty of space and great signage out front so if your
friend would slowly like to build a pediatrics practice here, that is
something we could talk about. I do have a couple of local physicians I am
meeting with this week but as I told you, I am not interested in building up
a local physicians practice but am looking for an out of the area physician,
to come in and appreciate this type of setup and build up "Northern
California Weight Loss/Skin Care Center" with my nurse practioner and
myself.
If your physician friend is interested and has a California address she can
use until she comes out that would be a great way to get started. We are
about a month away from finalizing this so please forward this to her and if
she is interested, she can call me at xxx-xxx-xxxx. Anytime is fine, even
midnight her time!