TopicBusiness
Starting and running a practice
Can I build a practice that pays, and what does it really take?
The economics of clinics: setup, fixed costs, break-even and the first years, with the people and paperwork that come with them. Real numbers, honestly labelled.
What this topic answers
The questions we are working through, in your words.
- How many patients does a clinic need?
- What does setup really cost?
- What do the first two years look like?
- Solo, group or hospital-attached?
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Practice Break-even Calculator
How many patients does a clinic need to cover its costs, and when does it pay back?
What will this loan really cost me, and what does paying extra save?
Terms to know
From the money glossary.
- Fixed costs
- Costs a practice pays whatever the number of patients: rent, salaried staff, software, loan repayments.
- Variable costs
- Costs that rise with each patient or procedure, such as consumables and per-test charges.
- Break-even
- The volume of work at which a practice’s income covers all its costs. Below it you lose money; above it you begin to earn a return on your time and capital.
- Cash flow
- The timing of money in and out. A profitable practice can still struggle if payments, such as insurer claims, arrive long after costs are due.
- Working capital
- The money needed to run day to day while waiting to be paid. New practices often underestimate it.
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