Interested In Starting Your Own TMS Therapy Clinic?

Since 2008, the first FDA-approval of transcranial magnetic stimulation (TMS) for the treatment of depression, TMS is becoming a preferred method of treatment for a number of mental, behavioral, and neurological health conditions.

Thinking of starting a TMS therapy clinic? In 2018, the global TMS market was valued at $883.38 million. The market is anticipated to grow at a CAGR (compound annual growth rate) of 8.8% through 2026. According to WHO (World Health Organization), the U.S. is one of the most depressed countries globally. Depression affects as many as 16.1 million (6.7%) of the adult U.S. population every year. TMS is FDA-approved for major depressive disorder (MDD), obsessive compulsive disorder (OCD), and smoking cessation. There are a total of seven FDA-approved TMS therapy devices available on the U.S. market. However, it is important to note that not all TMS systems are FDA-approved to treat all approved conditions.

What inspires the growth?

There is increasing interest among researchers in using TMS to treat a variety of mental health and neurological conditions. Driving this interest is the increased prevalence of depression, substance use, and neurological disorders, such as Alzheimer’s, neuropathic pain, and Parkinson’s disease, along with increasing awareness about TMS. Transcranial magnetic stimulation (TMS) is becoming a preferred method of treatment for mental health disorders, such as depression, anxiety, and obsessive compulsive disorder (OCD). Psychiatrists, and even non-psychiatrists are opening clinics all across the nation in hopes of giving life back to many people suffering from these life-robbing conditions. However, there are a number of things to consider before jumping into purchasing a TMS therapy treatment system. 

Considerations for aspiring TMS therapy clinic owners.

Before getting started with a TMS therapy clinic it is important to understand the industry, as well as the market in your geographic area. Since insurance began reimbursing for TMS in 2014, TMS therapy device sales have consistently grown year over year and the insurance landscape has changed significantly.

If you already have a private practice, you should think of your TMS clinic as a separate business. Sounds easy. But many TMS clinic owners have launched their clinics without knowing the nuts and bolts of running a thriving TMS therapy clinic. You may be a healthcare provider, business owner, or entrepreneur – but running a TMS therapy clinic is much different than running a private practice or any other business. Be sure to do your due diligence on available TMS therapy devices, billing and reimbursement, and TMS therapy guidelines before diving into purchasing a TMS system. Here’s a checklist of items to consider as you move forward with starting your own TMS therapy clinic.

• Choose the right legal business structure (sole proprietorship, LLC, corporation, partnership)
• Understand what FDA-approval means as it relates to the TMS therapy system you purchase, as well as reimbursement
• What conditions will you treat in your TMS clinic
• Know which TMS system is best for you – you can check out a quick reference guide of FDA-approved systems HERE.
• How will you properly fund your business for growth and success
• Know how best to market your TMS clinic in your geographic area
• Understand that what you don’t know can hurt you the most. For example, if you don’t understand the credentialing and reimbursement process, then consult with a TMS industry expert.
• Outsource areas of your business to those who specialize in the industry. The only TMS specialty consulting and comprehensive service provider in the U.S. is MNH TMS & Psychiatry Services.

Avoid making costly mistakes

I’ve worked with a number of psychiatrists and non-licensed professionals who have reached out for assistance either before or after starting their TMS therapy clinic. In speaking with my clients, I find that many share the same obstacles in getting started, as well as the frustrations with running the day-to-day business. So, I assume if you’re reading this article, then you are likely considering opening a TMS clinic or perhaps have already done so, and need further direction. My hope in writing this article is to help guide you in the process so that you can avoid common and costly mistakes.

Let’s start with the most common mistake that could potentially save you thousands of dollars

#1 Don’t talk to a TMS device rep or purchase a TMS therapy system before talking with the TMS consulting agency. Why? The best place to get unbiased TMS device information is from an expert who knows the industry and is not trying to ‘sell you the device‘. I’ve talked to many physicians and other TMS clinic owners after they’ve purchased a TMS device. Sadly, I learn that their TMS device has been sitting and collecting dust for months and even years because they didn’t realize all the facts about billing, reimbursement, the prior authorization process, or even how the high cost of treatments would negatively impact their business. For instance, certain TMS device manufacturers will promise to provide specific services, such as marketing and patient intake services in lieu of charging a fee for every TMS treatment administered. Unfortunately, those who purchase these fee-for-service TMS systems don’t realize the fee can be close to 40-50% of what insurance reimburses. This leaves very little for other operating costs and can significantly impact your profit margin. Additionally, I can’t tell you how critical it is to initiate the credentialing process prior to purchasing a TMS therapy device if your business will primarily be insurance-based. There are a number of steps that need to be implemented well before purchasing a device. In fact, the equipment should be one of the last steps in starting your TMS therapy clinic.

#2 Don’t assume you have the staff to run the back office or bill for TMS services. TMS is a whole different bird. If you plan to take insurance, then the majority of patients you treat will require a prior authorization before able to start treatment. Don’t be fooled in thinking that this prior authorization is similar to obtaining prior authorization for a medication. There is an art and science to submitting a successful prior authorization for TMS therapy. This will be one aspect of your business where you will want to consider outsourcing to an expert.

#3 If your billing provider has not previously billed for TMS therapy, they will likely not know how to bill for TMS services. Our agency receives calls every day from TMS clinics who have provided TMS treatment to many patients with no reimbursement. I’ve personally spoken with many TMS owners who have over $100 thousand in denied claims. You certainly don’t want to take risks or cut corners when it concerns astute billing procedures. It’s better to outsource one of the most critical aspects of your business to an expert.

#4 Do your research on how best to set up your TMS clinic. Decide if TMS will be an added service to your current practice or if starting a new business and tax ID would be a better route. The biggest mistake you can make is getting your information secondhand because laws vary from state to state. It’s always a good idea to speak to your accountant or an attorney, as well as an unbiased TMS industry consultant. A few things you might consider when making this decision are as follows:

•      Does your current practice have the necessary minimum space requirements available to add TMS services (treatment room, patient consultation room, reception space)?
•      Does the ownership structure of the TMS business differ from that of your private practice?
•      Is your current practice 100% cash pay? If so, will you accept insurance in your TMS clinic? Be sure to consider, that while a patient is inclined to pay a couple hundred dollars for a psychiatry visit, they may not be so inclined to pay several thousands for a course of TMS therapy. We receive calls in our agency every week from TMS clinic owners who want credentialing services because they are losing a significant amount of business by not accepting insurance.
•      If you intend on your TMS daily census to be sustained at greater than four or five patients, it may be challenging to effectively integrate and streamline TMS into your existing practice. In many ways, TMS is a business that works best when ran separate from a private practice. While the business may be located within the same office, it seems the most successful clinics run TMS as a separate business with its own tax ID. While this option may require a bit more effort up front, sometimes the payoff is much better in the long run, and the cost to start set up a new EIN is minimal.

#5: Consider decreasing your operating cost by outsourcing to a TMS support management provider that offers expertise in TMS reimbursement and billing, prior authorization submission, TMS business management or consulting services. This allows you to focus on what you do best – helping your patients to feel better and live a much better quality of life. TMS patients require a consultation, benefits check, medical records request, and a prior authorization before they can even start therapy. While there is much more to the process, it requires a great deal of knowledge in order to run the business effectively, efficiently, and profitably. Metro NeuroHealth (MNH) TMS & Psychiatry Services is the nation’s only TMS industry specialty service provider.

#6: Most importantly, don’t have all your eggs in one basket when it concerns keeping the chair busy.  Implement a business plan and marketing budget. A thriving TMS clinic keeps their chair(s) full from a number of different referral sources, with about 50 percent of their business relying on self referrals from online marketing and website traffic. The most successful clinics are those who have a great responsive website and online presence. This includes digital media, Blogs, and community engagement. 

#7 Be opened-minded and offer your patients a comprehensive program in which to engage.  There’s plenty of research to support the fact that engaging your patients in multiple treatment modalities only serves to improve outcomes. Therefore, I recommend incorporating some type of weekly therapy into your TMS program in an effort to improve patient outcomes and add an additional stream of revenue to your clinic. MNH TMS & Psychiatry Services developed a program called Mind Your Mental Health, which provides your clinic therapist or TMS technician all the tools they need to lead your patients from negative thoughts and behaviors to a road of mindful awareness and positive thinking. This program is being used in TMS clinics and psychiatry practices all across the U.S.

TMS is not something that is easy to ‘just add to an existing practice’. It truly is a whole new beast that can have great financial benefit if set-up and ran properly. However, too often, chairs get purchased and then end up sitting in a room within a private practice rarely used. This happens when things like performing due diligence and gaining knowledge of the prior authorization and billing process were never taken into consideration prior to purchasing a TMS system.

For more information about starting a TMS therapy clinic or if your current clinic is struggling, consider outsourcing those services where you lack experience or need assistance to an expert. MNH TMS & Psychiatry Services can help. To schedule a 30-minute consultation call MNH at 1-833-TMS-HELP or send an email to request more information at Info@TMSstartitup.com.