Guide
What It Costs To Start A Therapy Practice In 2026
This guide builds a line item budget for LPCs, LMFTs, LCSWs and psychologists opening a practice. Every quoted price comes from the seller's or state's own page, and costs without a published price are left for your own quotes. First Practice Launch covers payer, EHR, scheduling and medical billing setup.
Practice Launch
Most therapy practice cost guides hand you an average. This one builds a line item budget and only prices what we could confirm on the seller’s or the state’s own page. Where no published price exists, we explain what the cost depends on and leave the figure to your own quotes. It’s for LPCs, LMFTs, LCSWs and psychologists opening a practice that takes insurance.
The Line Item Budget
| Line Item | What We Can Cite | Where It Comes From |
|---|---|---|
| State business filing | $50 in Colorado, $100 in Oregon, $180 in Washington for an LLC | Each state’s own fee page or form |
| State renewal | $25 periodic report in Colorado, $100 annual renewal in Oregon | The same state pages |
| EIN | Free | IRS |
| CAQH/DataSpring profile | No cost to clinicians | DataSpring |
| EHR | One example: $49, $79 or $99 a month at standard pricing | SimplePractice pricing page |
| Malpractice insurance | No published price we could cite. It depends on your profession, state and coverage limits. | Your own quotes |
| Credentialing | Individual Provider credentialing starts at $1,200 for two payers | Our published price |
Beyond the table, price a business bank account, an accountant if you want one, telehealth platform or office space, phone and website. Those vary too much by provider to quote.
Spend in dependency order. The state filing and EIN come first, since they’re cheap and nearly everything needs them. Malpractice quotes come next, because payers ask for proof of coverage. Then the EHR, then credentialing applications, so you’re ready when a payer says yes. Free items like your CAQH/DataSpring profile go up front too.
State Filing Fees: Three Examples From The States’ Own Pages
Colorado’s Secretary of State lists Articles of Organization for an LLC at $50, filed online, and a periodic report at $25. Oregon’s Corporation Division lists the same articles at $100 with an annual renewal at $100. Washington’s current Certificate of Formation form for an LLC lists a $180 filing fee, plus an optional $100 for expedited service.
Those are LLC fees. Licensed clinicians sometimes must form a professional LLC or corporation, and the form and fee can differ. Oregon lists $100 for professional corporation articles, for example. Check your state’s page for the form that fits your license. We guide the filing but never pick between an LLC and a PLLC for you, and we give no legal or tax advice.
The IRS issues your EIN free. If you still have a job, our 90 day plan for opening a practice while employed puts them on a calendar.
EHR Costs
SimplePractice publishes standard monthly prices for a solo practice: $49 for Starter, $79 for Essential and $99 for Plus. The page also shows 50 percent off the first three months on each plan, then the standard price applies. Twelve months at Starter standard is $588.
Plans differ in what they include, so match the plan to your needs before comparing EHRs. Others publish their own prices, and some price by clinician count or add ons. We don’t quote an EHR price we couldn’t confirm on its seller’s page.
Malpractice Insurance
We couldn’t confirm a published malpractice premium for therapists on a carrier’s own page, so there’s no number here. Carriers quote on your profession, state, setting and limits, so get quotes from two or three carriers.
You’ll need the policy early. Oregon’s standard application, for example, lists the face sheet of your professional liability policy among the attachments, and Oregon’s credentialing statute counts proof of coverage meeting the insurer’s requirements as part of a complete application. Our Oregon application guide covers that form.
What Credentialing Costs
Individual Provider credentialing starts at $1,200 for two payers ($500 setup plus $350 per payer). Each added payer is $350, so five payers come to $2,250. That covers preparing, submitting and following your applications to each payer’s decision.
For the per payer structure, read what therapist credentialing costs. State licensing and setup steps are in our guides for California, Florida, Oklahoma, Pennsylvania, Texas. Prescribers have their own breakdown in what it costs to start a PMHNP practice.
A Worked Example Using Only Published Numbers
Say a Colorado therapist files an LLC for $50, picks SimplePractice Starter at $49 a month ($588 for twelve months) and prices Individual Provider credentialing for two payers at $1,200. That’s $1,838 in published line items, before malpractice premiums, taxes, bank and accounting costs, space, phone, and the Colorado periodic report due later at $25.
The bigger number isn’t on any price page. Payers decide on their own schedule, commonly 60 to 120 days in our experience, our planning estimate and not a payer’s published figure. Until a payer gives you an effective date, you’re paying costs with no in network income from it, so budget living expenses.
Frequently Asked Questions
Do I Need An LLC To Start A Therapy Practice?
That’s a legal and tax decision that depends on your state and license, so we don’t make it for you. Some states have rules for licensed professionals. Check your state’s business registry and talk to a local attorney or tax professional.
Is An EIN Free?
Yes. The IRS says you never pay a fee for an EIN, and it’s issued right away online if your application is approved.
How Much Does It Cost To Keep An LLC Active After The First Year?
It depends on the state. Colorado lists a $25 periodic report and Oregon a $100 annual renewal. Check your state’s page.
What Is The Cheapest EHR For A Therapist?
We can’t answer that fairly without comparing every seller’s current prices. SimplePractice publishes $49, $79 and $99 monthly plans that differ in what they include, so compare features as well as price.
How Much Should I Save Before Opening?
We won’t hand you an average. Add the line items above, your own quotes for the unpriced ones, and living expenses for the credentialing window, commonly 60 to 120 days in our experience.
Official Sources
- Colorado Secretary of State: Business Organizations Fee Schedule
- Oregon Secretary of State: Business Registry Fee Schedule
- Washington Secretary of State: Certificate of Formation, LLC (revised 6.2025)
- IRS: Get an employer identification number
- SimplePractice EHR Pricing and Plans
- DataSpring, powered by CAQH: For Clinicians and Office Staff
- Oregon Health Authority: 2025 Oregon Practitioner Credentialing Application
- Oregon Legislature: ORS 743B.454, Claims submitted during credentialing period
Pricing Out Your Own Practice
Individual Provider credentialing starts at $1,200 for two payers ($500 setup plus $350 per payer). If you want business setup, five commercial payers, payer portals and EHR setup handled together, First Practice Launch is $6,000, or $1,500 a month for four months, with five commercial payers included.
This is general information, not legal, tax, accounting or insurance advice. Fees and prices change, so confirm each figure on the linked page before relying on it. Last reviewed: November 6, 2026.
Need Help With This In Your Practice?
Use the guide yourself, or see the related service when you want AdvanceAPractice to handle the work.