Professional services
Medical Practice Break-Even Calculator
Works break-even, where a large fixed base makes the crossing point sharp.
Result
Break-even, not a target. It is the point where the business stops losing money, which is a floor rather than a plan. Owner's pay only counts here if it is inside the fixed costs you entered.
Get a Free Business AuditHow the calculation works
Fixed costs divided by contribution per visit gives the visits needed monthly. Almost everything in a practice is fixed in the short term, including staff, premises, equipment and systems, which means the contribution from each additional visit falls almost entirely to the bottom line above break-even and the loss accumulates quickly below it.
What moves the number
- Fixed costs, which are the bulk of the base.
- Contribution per visit by payer.
- Whether provider compensation is fixed or production-based.
- Visit mix.
Where this one goes wrong
Production-based provider compensation lowers break-even substantially because it converts the largest cost into a variable one, while salaried providers put it above the line and make the practice far more exposed to a quiet period. That is the structural difference worth modelling rather than assuming. Running the calculation at a realistic payer mix rather than a favourable one gives the figure that holds, since the mix is the input that moves contribution most.
Before you quote
- Model salaried and production-based compensation separately.
- Use a realistic payer mix, not a favourable one.
- Express the answer as visits per provider per day.
Questions
About this calculator
Why is the break-even crossing so sharp in a practice?
Because almost everything is fixed in the short term, so contribution from each extra visit falls almost entirely to the bottom line above break-even and losses accumulate quickly below it. There is very little that flexes with volume.
Does provider compensation structure change break-even?
Substantially. Production-based compensation converts the largest cost into a variable one and lowers break-even; salaried providers put it above the line and leave the practice fully exposed to a quiet period. That difference is worth modelling rather than assuming.
Which payer mix should the calculation use?
A realistic one, since mix is what moves contribution per visit most. Using a favourable mix produces a comfortable figure that the practice will miss while believing it is ahead, which is the worst position to be in.
The formula
break-even visits = fixed costs / (average collected per visit x gross margin%)
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How to use this calculator
- Monthly fixed costs ($). Rent, office wages, insurance, vehicle payments, software, advertising.
- Average collected per visit ($). Enter your own figure; the page starts at $2,600.
- Gross margin per visit (%). Enter your own figure; the page starts at 58%.
The result updates as you type, so you can try a figure, see what it does to visits needed per month, and change it back. Nothing you enter is sent anywhere or saved.
A worked example
These are the figures the calculator opens with. Every number in the results column below is produced by the same calculation the page runs, so you can follow it through before putting your own figures in.
What goes in
| Input | Value |
|---|---|
| Monthly fixed costs | $24,000 |
| Average collected per visit | $2,600 |
| Gross margin per visit | 58% |
What comes out
| Result | Value |
|---|---|
| Visits needed per month main result | 16 |
| Revenue needed per month | $41,600 |
| Gross profit per visit | $1,508 |
| Visits per working day | 0.7 |
You need 16 jobs a month, about 0.7 a working day, to cover $24,000 of fixed cost. That is $41,600 of revenue before the business earns anything.
How sensitive the answer is
Holding everything else steady and changing only monthly fixed costs, this is what happens to visits needed per month. It is worth knowing which of your inputs the answer actually hinges on, and which barely move it.
| Monthly fixed costs ($) | Visits needed per month |
|---|---|
| $12,000 | 8 |
| $18,000 | 12 |
| $24,000 example above | 16 |
| $36,000 | 24 |
| $48,000 | 32 |
Every other input is held at the example value while this one changes, which is not how a real job behaves. Treat it as a guide to which number matters most, not as five separate quotes.
What each figure means
- Monthly fixed costs ($)
- Rent, office wages, insurance, vehicle payments, software, advertising.
- Average collected per visit ($)
- A money amount, starting at $2,600.
- Gross margin per visit (%)
- A percentage, between 0 and 95, starting at 58%.
What the results tell you
| Result | What it is |
|---|---|
| Visits needed per month | The headline result. A number. |
| Revenue needed per month | A money figure. |
| Gross profit per visit | A money figure. |
| Visits per working day | A decimal figure. |
Estimating is the easy part
The jobs you never hear about cost more than the ones you mis-measure. BDEVY builds the marketing, systems and automation that bring them in.