This has been written due to the need to clarify why and how doctors work out of clinic and what it means when they move.
In my case, the moves have been due to looking for a site that better suits the needs of my business and my clients. I have owned an operated my own business since starting work as a private consultant in 2019, there have just been different clinics providing the following services for me over this period. The naming conventions are very confusing, unfortunately, and people can easily believe that doctors are employed by their clinics.
Why Psychiatrists Operate as Self‑Employed Businesses – And What That Means for You
1. The Big Picture: Private‑Practice Psychiatry in Australia
Most Australians think of doctors as employees of hospitals or large medical groups. In reality, the overwhelming majority of psychiatrists work as independent contractors. They own their professional practice, bill patients directly, and simply rent space in a clinic.
This business model is typical of a private clinic in the Australian health system (and is part of the challenges larger clinics are facing with the Payroll Tax issues):
Aspect | Typical arrangement for a psychiatrist |
Legal status | Sole trader or incorporated business (ABN) |
Income source | Professional fee charged to the patient |
Overhead | Clinic rent, utilities, reception staff, marketing, insurance – paid by the psychiatrist |
Employment relationship | The psychiatrist is not on the clinic’s payroll. The relationship is one of sole trader who pays the clinic for appropriate supports as agreed within the scope of their working relationship. |
Control | Full authority over and responsibility for patients seen, schedule and types of treatment offered. |
Working environment | Groups of psychiatrists and other professionals who work together frequently prefer to work in a collegial and supportive environment, including working with their administrative and management staff and seeing themselves as a cohesive group. |
Because the psychiatrist is the owner of the business, they can decide where to work, how much to charge, and when to move to a new location.
2. How the Money Flows
Patient Consultation – The psychiatrist sees a patient and records a professional fee.
Billing – The fee is sent to the patient or Medicare (if a bulk‑billing arrangement applies).
Clinic Contribution – The clinic that houses the consulting room receives either:
A percentage of the professional fee (commonly 20‑40 %).
A fixed “standing fee” or rent (e.g., AU$4000 / month for a furnished consulting suite).
Net Income – After the clinic’s share is deducted, the remainder is the psychiatrist’s net profit. From that, the psychiatrist pays for further operating costs:
Professional indemnity insurance/Professional memberships
Office supplies, software licences, continuing‑education fees
Taxes and superannuation contributions
Because the clinic’s share is a business expense, it does not appear as an extra charge to the patient. The patient sees only the professional fee set by the psychiatrist.
3. Freedom to Choose Where to Work
Being self‑employed gives psychiatrists a level of mobility that salaried physicians rarely enjoy. The decision to move from one clinic to another is driven by personal preference, not by a corporate HR department. Common reasons include:
Reason | What It Looks Like in Practice |
Work‑life balance | Selecting a clinic closer to home, with flexible opening hours, or with a quieter environment. |
Specialised facilities | Moving to a space that offers sound‑proof rooms, child‑friendly waiting areas, telehealth infrastructure or other treatment modalities. |
Professional collaboration | Joining a clinic that houses complementary practitioners (psychologists, occupational therapists) to facilitate multidisciplinary care. |
Personal changes | Psychiatrists may move locations and need to relocate to a different clinic. |
Personal growth | Relocating to a new suburb to reach a different patient demographic or to expand a private practice. |
Because the psychiatrist owns the patient list, a move does not disrupt continuity of care. The doctor and the patient can make a collaborative plan about what to do about care and if the new location or setting suits the patient.
4. What This Means for You, the Patient
Concern | Reality |
“Is my doctor an employee? Will the clinic control my treatment?” | No. The psychiatrist makes all clinical decisions independently. The clinic only provides the physical space and administrative support. |
“Will my fees increase if the doctor changes clinics?” | Not automatically. The professional fee is set by the psychiatrist, not the clinic. A move may affect overhead costs, but any change in fee would be communicated transparently. |
“Will my records be transferred?” | Yes. As the owner of the practice, the psychiatrist retains all medical records and transfers them to the new location. |
“Why does my doctor sometimes list multiple clinic addresses?” | Those are the venues where the psychiatrist rents space. Many professionals work out of several locations for a great many reasons. |
“Can I still see the same doctor if they move?” | Because the doctor is self‑employed, they can bring their patients with them wherever they practice. Whether or not this is suitable for what the patient needs will depend on the individual patient and where the doctor relocates. |
5. Dr Megan Richardson
I left Queensland Health at the start of 2019 and have always been self‑employed when in private practice. My business model follows the pattern described above:
Professional fees are billed directly to patients or insurers.
I rent a consulting suite in Ashgrove, paying a standing fee for the use of the room and utilities.
I holds my own professional indemnity insurance and comply with AHPRA regulations as an independent practitioner.
Clinical and business decisions are made by me.
My moves between clinic locations have been purely personal choices—seeking a quieter environment, better accessibility for families, or a space that supports telehealth sessions.
In each case, I have retained ownership of my practice and patient list.
6. Frequently Asked Questions (FAQ)
Q: If the psychiatrist pays the clinic a percentage, does that mean my bill is higher?A: No. The percentage is a cost the psychiatrist absorbs before receiving their net income. The patient sees only the professional fee set by the psychiatrist.
Q: Can a psychiatrist stop paying the clinic and work from home?A: Yes, many psychiatrists now run hybrid models with a mix of in‑person rooms and telehealth. The decision depends on the terms of the rental agreement. Working from home while maintaining an active clinic only results in a marginal reduction in overheads due to the other costs remaining (or increasing). Telehealth clinics may charge a psychiatrist a similar percentage, as the admin support required may be higher if the psychiatrist is off-site.
Q: Does being self‑employed affect the quality of care?A: Not negatively. In fact, the autonomy often allows doctors to tailor schedules, invest in specialised equipment, and collaborate with other professionals—all of which can enhance patient outcomes.
7. Bottom Line
Psychiatrists in Australia largely operate as self‑employed business owners who:
Bill patients directly for professional services.
Pay clinics a percentage of that fee or a fixed rent for the use of space and administrative support.
Choose where to work based on personal preferences such as location, facilities, and work‑life balance.
Because the doctor owns the practice, your continuity of care is protected whenever the doctor relocates. The clinic is simply a landlord, not an employer.
If you have any questions about how this model works for your own treatment, or if you’d like to know more about Dr Megan Richardson’s practice, feel free to reach out through the contact details on this site. Your mental‑health journey is a partnership—understanding the business side helps you make informed choices about the care you receive.
