My Journey Opening a Ketamine Clinic | White Coat Investor

[Editor’s Note: On Monday we announced three new real estate funds being offered by WCI sponsor DLP Capital Partners with lowered $100k minimums to White Coat Investors. Tomorrow (Thursday, February 4, 2021, at 2 PM EST) is a great chance to learn more details about these funds at our Facebook LIVE event that the CEO of the company and I will be doing.

Also, we have a new job opening here at WCI for a part-time Search Engine Optimization/Content Specialist to implement our SEO strategy across all of the blog, podcast, and video content. We’re willing to train, but the ideal applicant will already have some experience in the field. If you know someone that would be a great candidate, please pass this opportunity along!

Today’s guest post was submitted by Dr. Samuel Ko, the founder and medical director of Reset Ketamine in Palm Springs. Every start-up business will need to be ready to handle curveballs thrown their way. Dr. Ko is a good example of the entrepreneurial spirit necessary to find ways to thrive when the unexpected thwarts their path. We have no financial relationship.]

In the past decade, I’ve worked as a community emergency physician, an associate medical director in the emergency department (ED), and an assistant professor of emergency medicine (EM). I love making and executing decisions, seeing rapid improvements in patients, and taking time to connect with patients. But over the years, I’ve slowly realized the ladder that I was climbing was placed upon the wrong building. That is, until the seed of a ketamine clinic startup was planted in my neurons.

Two roads diverged in a wood and I – I took the one less traveled by, and that has made all the difference. – Robert Frost

As you may know already, ketamine is being used off-label for the treatment of depression, PTSD, anxiety, OCD, and some types of chronic pain. Scientists have called ketamine “the biggest breakthrough in depression research” in 50 years.

After two years of false starts, analysis paralysis, and discussion with friends and family, I opened up Reset Ketamine, the first clinic of its kind in Palm Springs, CA in 2018.

I won’t kid you, it was tough. Not physically, but rather overcoming my own internal mental barriers as well as logistic obstacles. No one is taught how to open up your own clinic in medical school and certainly not in EM residency.

One of my mentors, an emergency physician who had started an ambulance and event medicine company told me, “Sam, perfection is the enemy of execution. Strive for excellence instead.”

He could see that my ideal to do it “perfectly” was limiting me from actually starting up the clinic.

 

Finding the Clinic Space: From Perfection to Get the Job Done

I started looking for medical offices. Most were too expensive, too big, too small, or too old. Nothing really fit exactly what I was looking for. I even contacted other doctors to see if I could rent out an extra spare room, but didn’t get any responses. I figured I’d just push back the opening date while looking around for the perfect office space.

With some encouragement from my wife and partner, I decided to look in another city for the office instead. This would require a 45-minute commute, but once I started looking in Palm Springs, a location opened up immediately. It wasn’t perfect, but it would definitely get the job done.

After some negotiation, I signed the lease and took a step on my path.

 

Getting Malpractice Insurance Coverage: Be Persistent

I began looking for malpractice insurance coverage for ketamine infusions. I applied with an insurance broker. He came back to me and said that out of the six companies he contacted none would cover IV ketamine infusions.

I was devastated. How could I open up without medical malpractice coverage?

I directly called up one of the companies who initially denied my application and asked to speak with someone about my situation. After a long discussion with the senior underwriter for 90 minutes about off-label IV ketamine use, she said she’d bring it up to the committee and let me know.

I got an email from her a few days later. I was APPROVED for malpractice coverage! It would cost a lot, but still it was a hurdle that I’d overcome towards my goal.

 

The Buildout: Digging Deep

At a minimum, all I needed was a waiting room, a sink, a bathroom, and one room for the infusion space. My contractor was working on the clinic and the costs were quickly adding up—much more than I had planned for. I was feeling overwhelmed and stressed about the added costs. What if I invested all this money to open up the clinic and no one showed up?

But I knew that I would regret it if I stopped now. Accordingly, I dipped into our personal emergency funds and transferred money into the business account to cover the extra costs.

 

A Ketamine Shortage: Leveraging My Contacts

Soon everything was coming along nicely. The office was nearly finished and I had figured out the various licenses, supplies, etc. that I would need, except the most important part.

As I tried to order ketamine, I learned that there was a nationwide ketamine shortage. I kept waiting for the backordered ketamine to come through, but to no avail. It was one week before the planned opening date, and yet I had no ketamine at a ketamine clinic.

I scrolled through my contacts and reached out to my network. I recalled a colleague who was previously an ED pharmacist and had recently opened up an outpatient pharmacy. After a few calls, he was miraculously able to find a wholesaler and order several boxes for me.

Whew. Ketamine secured!

 

Placing IVs: Practice Makes Perfect

In the ED, I rarely put in the peripheral IVs since that is typically done by nursing staff. I wasn’t sure a nurse would want to work at a clinic that was open by appointment only (irregular hours) and had only a few infusions the first month.

So I reached out to an old friend, who was a nurse at an ER I used to work at. She was now a nursing director of an urgent care. Generously, she volunteered her time and said she’d work for me for free for a few hours on her days off.

And that’s how the first infusion happened. A last-minute ketamine order, a volunteer ER nurse, and me in our small, newly renovated office.

Some days, my RN friend couldn’t come so I had to start my own IVs. I purchased a vein finder and practiced a lot. But for one patient, I had to poke him 5 times before getting a line.

Eventually, the Butterfly Ultrasound became available so now I can easily get a peripheral IV in any patient.

 

Keeping a Low Overhead: Minimizing Pressure

The first month of opening I saw less than 4 patients. Fortunately, I kept my overhead low. I did the majority of the work, hired my sister-in-law for front office work, and continued working in the ED to help with financial stability.

As the volume of patients began trickling upward, I gradually reduced the number of ED shifts each month. Because I kept my overhead very low, I never felt pressure to see difficult patients or try any type of “hard sell” to get more patients.

 

Marketing: Direct to Patient vs. Referral Dependent

I sent a letter to all the local primary MDs and psychiatrists announcing that I was opening up a ketamine clinic. Unfortunately, there weren’t many referrals. But through our blog, YouTube channel, and social media (Twitter, Instagram, LinkedIn), patients began finding our clinic on their own.

With the help of my partner and wife, we continued making lots of informational videos, blog posts, and I gave presentations to share the science behind the off-label use of IV ketamine.

Initially, the audience was small, but with continued efforts, we now get more visitors to our website in a week than what we got in the first few months of opening.

 

COVID-19 Pandemic: From Side-Hustle to Main-Hustle

COVID-19 came crashing down on us which caused a dramatic drop in the number of patients both at the ketamine clinic and in the ED. Since I was a part-time ER doctor, I wouldn’t be given any shifts in the ED for several months so that the full-time emergency physicians could get their allotted hours. All of a sudden, the most stable job in the world became unstable.

Fortunately, I was able to access the PPP Loan and obtain an SBA grant. Also, there were still a number of patients coming in for ketamine booster treatments at the clinic.

On top of this, there was a national Personal Protective Equipment (PPE) shortage, and I couldn’t buy any surgical masks, gloves, or face shields. Luckily, the California Medical Association had an opportunity for a small doctor’s office to receive free PPE right in the nick of time.

 

Redefining Myself: From ER Doc to Ketamine Specialist

With the pandemic and a shift in my perspective, I’ve decided to take a sabbatical from the ER. I’m not sure how long it will be, but I believe I’ve found my niche in medicine. Furthermore, my autonomy in medicine is higher than ever, my patients get rapid improvements, and I have the time to connect with my patients.

In the past, patients in the ED would ask me, “What are you going to specialize in after your time in the ER?” Now, I can confidently answer, “I am a ketamine specialist.” I was trained as an emergency physician and never thought I’d end up owning a private practice ketamine infusion clinic. But it’s been one of the best decisions I’ve made and I’m able to utilize my unique skill set to transform patients’ lives.

I’ve had many physicians reach out to me and ask how I started up a ketamine clinic. So I’m working on an online course. The goal is to help other physicians go from feeling lost and overwhelmed to feeling empowered and knowledgeable to start their own ketamine clinic in under 12 weeks. On the site, there’s also a link to download a free ketamine clinic start-up checklist. If you have any questions, feel free to reach out to me.

What advice do you have for a new practice owner for handling the unexpected? How did you overcome analysis paralysis when deciding to start a business?  Comment below!