This article was written by our expert who is surveying the industry and constantly updating the business plan for a physical therapist.
This guide explains, in plain English, how long it takes a physical therapy clinic to break even—and exactly which numbers move the timeline.
All figures reflect recent industry data as of October 2025 and are organized so a first-time physical therapist owner can plan realistically and avoid cash-flow surprises.
If you want to dig deeper and learn more, you can download our business plan for a physical therapist. Also, before launching, get all the profit, revenue, and cost breakdowns you need for complete clarity with our physical therapist financial forecast.
A new physical therapy clinic typically breaks even between 12 and 36 months, depending on startup size, payer mix, rent, hiring pace, and referral growth. Use the table below to benchmark your own plan and set a realistic cash reserve.
You’ll find more granular benchmarks, pro-formas, and payer-mix scenarios in our physical therapist business plan, updated quarterly.
| Metric | Typical Range / Benchmark (U.S.) | What Drives the Range |
|---|---|---|
| Upfront investment | $20,000 (micro/home) to $400,000+ (full-service clinic) | Location build-out, equipment level, size, brand/franchise fees |
| Monthly operating costs | $15,000–$50,000 | Rent, therapist/admin headcount, marketing, insurance, software |
| Revenue per visit | $100–$120 average; $70–$100 rural; $150+ specialty/cash | Region, service mix, payer mix (Medicare/Medicaid vs commercial vs cash) |
| First-year volume | 15–30 visits/week to start; doubles or triples by month 12 for strong performers | Referrals, marketing execution, hours, capacity |
| Visits per patient episode | 8–12 visits (musculoskeletal average) | Case mix, adherence, clinical protocols |
| Insurance reimbursements | 21–45 days typical lag (longer for public payers) | Billing accuracy, clearinghouse speed, payer policies |
| Typical break-even | 12–36 months (solo 18–36, partnership 12–24, franchise 9–18) | Capitalization, brand awareness, shared overhead, payer mix |
What is the typical upfront investment required to start a physical therapy practice (equipment, space, licensing)?
Most new physical therapy clinics need between $20,000 and $400,000+ in upfront capital.
Lean, micro, or home-based setups can launch with ~$10,000–$25,000, while full-service outpatient clinics with build-out and advanced equipment often exceed $250,000. Licensing, legal, and initial insurance usually add several thousand dollars depending on your state.
Equipment alone ranges from $10,000–$15,000 for basics (tables, bands, free weights) to $100,000+ if you add modalities (e.g., traction, ultrasound), force plates, or aquatic therapy. Clinic space is the biggest swing factor when tenant improvements are needed.
As of October 2025, plan a 10–15% contingency for overruns on build-out and lead times on equipment deliveries.
Get expert guidance and actionable steps inside our physical therapist business plan.
| Cost Category | Typical Range | Notes for Physical Therapy Clinics |
|---|---|---|
| Clinic build-out & signage | $5,000–$150,000+ | Depends on shell condition, permits, accessibility, and branding. |
| Equipment (basic to advanced) | $10,000–$100,000+ | Tables, racks, free weights vs. traction, modalities, treadmills, EMG. |
| Initial rent & deposits | $6,000–$30,000 | Typically 1–3 months’ rent plus security; varies by city. |
| Licensing, legal, compliance | $1,000–$8,000 | Business registration, state PT licenses, CLIA if applicable, HIPAA setup. |
| Insurance (startup binders) | $2,000–$6,000 | General liability, malpractice/professional, workers’ comp, cyber. |
| Software & IT | $1,000–$5,000 | EMR/EHR, billing, telehealth, computers, networking, phones. |
| Opening marketing | $3,000–$15,000 | Launch campaign, website, local outreach, physician liaison. |
What are the average monthly operating costs (rent, utilities, staff, insurance)?
Monthly operating costs for a physical therapy clinic typically land between $15,000 and $50,000.
Urban rents, multiple therapists, and robust marketing push you toward the high end; lean staffing and suburban/rural leases keep you closer to the low end. Insurance, software, and consumables add steady, predictable expenses.
Therapist salaries usually range $70,000–$110,000 annually per clinician, and admin support often costs $40,000–$60,000 annually per role. Liability and malpractice commonly total about $10,000 per year.
Budget at least $500–$1,000 per month for ongoing digital marketing even after the launch push.
This is one of the strategies explained in our physical therapist business plan.
| Expense | Typical Monthly Amount | Operational Notes |
|---|---|---|
| Rent | $2,000–$10,000 | Location, size, visibility, parking drive patient access. |
| Utilities & internet | $500–$2,000 | Higher for larger spaces and longer open hours. |
| Therapist compensation | $6,000–$9,200 per therapist | Equivalent to $72k–$110k annual plus benefits. |
| Admin/front desk | $3,300–$5,000 per FTE | Equivalent to $40k–$60k annual; consider cross-training. |
| Insurance (all lines) | $600–$1,000 | General/professional liability, workers’ comp, cyber. |
| Software (EMR/billing) | $59–$400+ | Seats, e-fax, e-claims, telehealth add-ons increase costs. |
| Marketing (ongoing) | $500–$1,000 | SEO, ads, reputation management, liaison mileage. |
What is the average revenue per patient visit, and how does it vary by region or therapy type?
The average revenue per visit for a physical therapy clinic is usually $100–$120.
Rural and low-reimbursement markets often see $70–$100 per visit, while specialty or cash-pay services can exceed $150 per visit. Commercial insurance typically pays more than Medicare/Medicaid.
Service mix matters: advanced sports/return-to-play programs, pelvic health, or cash packages often lift average revenue per visit. Payer mix discipline is crucial to keep averages healthy.
As you negotiate contracts, regularly review CPT utilization and denials to protect your realized rate.
We cover this exact topic in the physical therapist business plan.
| Setting / Region / Service | Typical Realized $/Visit | Key Drivers |
|---|---|---|
| Urban, mixed payer | $100–$120 | Negotiated contracts, higher commercial share, competition. |
| Rural, higher public payer | $70–$100 | Lower rates, fewer commercial plans, travel distance. |
| Specialty (sports, pelvic health) | $130–$160+ | Advanced expertise, longer sessions, add-on services. |
| Cash-pay packages | $120–$200+ | Direct pricing, no claim lag, perceived premium value. |
| Home-based/mobile PT | $120–$180 | Convenience premium, travel time pricing. |
| Medicare-heavy outpatient | $85–$105 | Lower schedule rates, strict documentation, units capped. |
| Workers’ comp/auto | $90–$130 | Documentation intensity, authorization cycles, collection lag. |
How many patients per week does a new physical therapist typically see in year one, and how fast does this grow?
New physical therapy clinics commonly start at 15–30 visits per week and grow sharply in months 3–12.
Strong marketing and physician relationships can double or triple weekly visits by the end of year one. A practical first-year target is 150–200 visits per month with one full-time therapist and admin support.
Growth tracks your referral engine, opening hours, and capacity; adding a second therapist meaningfully lifts throughput once demand is proven. Track new evaluations/week and show-up rate to manage ramp.
Assume seasonality—sports injury peaks and holiday dips—when planning schedules and promo pushes.
It’s a key part of what we outline in the physical therapist business plan.
| Month Since Opening | Typical Weekly Visits | Common Levers |
|---|---|---|
| Month 1–2 | 15–30 | Launch promos, friends/family, early physician intros. |
| Month 3–4 | 25–45 | Reviews build; first referral wins; ad targeting refines. |
| Month 5–6 | 35–60 | Community talks, employer outreach, better scheduling. |
| Month 7–9 | 45–75 | Add part-time therapist; expand hours; solidify PCP links. |
| Month 10–12 | 55–90 | Repeat patients, word-of-mouth, sport-season boosts. |
| Year 2 baseline | 70–110 | Multiple referral streams; payer mix curated; ops smooth. |
| Capacity flag | >90 | Consider second therapist/FTE and additional treatment bays. |
What is the expected patient retention rate and average number of visits per patient?
Physical therapy clinics typically retain 65–80% of patients through their full plan of care, averaging 8–12 visits per musculoskeletal episode.
Chronic neuro cases may exceed 12 visits, while simple acute cases can resolve in fewer than 8 visits. Clear care plans, reminder systems, and progress reporting increase adherence.
Track cancellation and no-show rates weekly; under 8% is a solid benchmark. Re-engagement calls and home-exercise app nudges help maintain continuity.
Measure outcomes (e.g., FOTO) and share them with referral sources to reinforce retention and referrals.
You’ll find detailed market insights in our physical therapist business plan, updated every quarter.
How long to establish steady referral relationships with doctors and other providers?
Most physical therapy clinics need 3–12 months to establish reliable physician and provider referrals.
Consistency matters: monthly check-ins, outcome summaries, and fast scheduling for referred patients build trust. Lunch-and-learns and co-branded education deepen the relationship.
Track referral source volume and conversion; drop unproductive tactics and double down on top performers. Use a structured liaison calendar to prevent gaps in outreach.
Plan for a 90-day lag between first introduction and meaningful, recurring referrals.
This is one of the many elements we break down in the physical therapist business plan.
What marketing and advertising budget is needed to attract enough patients in year one?
Allocate $5,000–$15,000 for your physical therapy launch plus $500–$1,000 per month ongoing.
Use paid search for “near me” intent, reputation management for reviews, and community events for trust. Physician-liaison time is a line item—treat it like sales, with goals.
Expect cost-per-new-patient between $60 and $200 early; this drops as reviews accumulate and word-of-mouth grows. Track cost per evaluation and lifetime value to optimize channels.
Protect your budget for the first 6 months; turning marketing “off and on” slows momentum.
Get expert guidance and actionable steps inside our physical therapist business plan.
How does the break-even timeline differ for solo practice vs partnership vs franchise?
Solo physical therapy practices usually break even in 18–36 months; partnerships in 12–24 months; franchises in 9–18 months.
Partnerships spread fixed costs and add capacity sooner, pulling the curve forward. Franchises benefit from brand, playbooks, and lead gen—at the cost of fees and constraints.
If you already have a patient panel or physician relationships, a solo practice can accelerate. Conversely, high rent and slow payer mix drag any model out.
Choose the structure that matches your capital, risk tolerance, and marketing strengths.
| Model | Typical Break-Even | Why It Differs |
|---|---|---|
| Solo private practice | 18–36 months | Slower referral ramp, owner does “everything,” lean capital. |
| Partnership (2–3 owners) | 12–24 months | Shared overhead, more clinical hours, faster marketing. |
| Franchise | 9–18 months | Brand awareness, proven playbooks, centralized marketing. |
| Hospital-affiliated | 12–24 months | Built-in referrals but bureaucratic constraints. |
| Multi-disciplinary rehab | 12–24 months | Cross-referrals from chiro/OT/ATC; more overhead. |
| Mobile/home-based | 9–18 months | Low overhead, higher visit value, travel limits capacity. |
| Cash-pay niche | 12–24 months | Higher $/visit, but slower to fill without insurance networks. |
What financing options are common, and how do loan repayments affect break-even?
Most physical therapy owners use a mix of SBA or bank loans plus savings; some add small investor capital.
A $100,000 loan at 7% over 10 years is roughly $1,161 per month, which raises your monthly break-even revenue by that amount. Under-capitalizing forces slow hiring and marketing, which lengthens the timeline.
Build 2–3 months of operating reserve to buffer reimbursement lags and seasonal dips. Compare fixed- vs variable-rate terms and prepayment penalties before signing.
Always layer loan payments into your weekly visit target so you know exactly how many visits cover debt service.
| Financing Option | Typical Use in PT Clinics | Impact on Break-Even |
|---|---|---|
| SBA 7(a)/bank loan | Build-out, equipment, working capital | +Monthly payment; enables faster ramp with staff/marketing. |
| Owner savings | Deposits, early payroll, marketing | No repayment; reduces pressure and interest cost. |
| Small investors | Growth hires, second location | Dilution vs debt; accelerates capacity and referrals. |
| Equipment financing | Modalities, treadmills, tech | Spreads cost; adds fixed monthly expense. |
| Credit line | AR gaps, seasonality | Flexible buffer; interest accrues if used. |
| Grants/incentives | Rural/underserved programs | Rare; reduces capital burden when available. |
| Leasehold allowance | Landlord TI contribution | Lowers build-out cash; may raise base rent. |
How long does it take to obtain insurance reimbursements, and how do delays impact cash flow?
Insurance reimbursements for physical therapy typically arrive 21–45 days after claim submission.
Public payers can take longer; denials and re-submissions stretch timelines. Electronic billing, clean documentation, and daily claim scrubs keep days-in-AR down.
Many new clinics need 2–3 months of working capital to cover payroll and rent while AR grows. Watch first-pass acceptance rate and target >90% for healthy cash flow.
Lock weekly AR reviews into your operating rhythm and measure by payer.
| Payer Type | Typical Payment Lag | Cash-Flow Tactics |
|---|---|---|
| Commercial insurance | 21–35 days | EDI claims, verify benefits, collect co-pays at visit. |
| Medicare | 28–45+ days | Accurate coding, timely notes, track NCCI edits. |
| Medicaid | 30–60+ days | Auths upfront, correct units, follow payer rules. |
| Workers’ comp | 30–60+ days | Authorization management, adjuster follow-ups. |
| Auto/PIP | 30–75+ days | Document medical necessity, legal coordination. |
| Cash/self-pay | 0 days | Paid at service; offer packages/memberships. |
| Average clinic AR | 30–45 days overall | Daily scrubs, weekly AR calls, appeal denials quickly. |
Which external factors most influence how quickly a PT clinic becomes profitable?
- Local competition density: saturated urban zones lengthen ramp; underserved areas shorten it.
- Demographics and demand drivers: older populations and sports communities increase visit opportunities.
- Payer mix and contract rates: higher commercial share speeds break-even; heavy public payer mix slows it.
- Regulatory requirements: licensing timelines and changing reimbursement rules affect margins.
- Location quality: parking, street visibility, and medical-office adjacency boost conversions.
On average, how many months or years until a new physical therapy clinic breaks even?
Most physical therapy clinics reach break-even in 12–36 months.
Solo startups commonly take 18–36 months; partnerships often reach 12–24 months; franchises average 9–18 months. Strong capitalization, a favorable payer mix, and disciplined marketing pull the date forward.
Conversely, high rent, slow referral growth, and reimbursement delays push break-even back. Build your model around realistic weekly visit targets and actual realized rates, not charge master rates.
Recalculate your break-even any time you change staffing, hours, or payor contracts.
You’ll find detailed sensitivity tables in our physical therapist business plan, updated every quarter.
Conclusion
This article is for informational purposes only and should not be considered financial advice. Readers are encouraged to consult with a qualified professional before making any investment decisions. We accept no liability for any actions taken based on the information provided.
Want more guidance for your physical therapy clinic?
Explore step-by-step launch plans, financial models, and growth playbooks tailored to outpatient PT owners.
Sources
- Dojo Business – Physical Therapist Startup Costs
- Medesk – How to Start a Physical Therapy Clinic
- Businessplan-templates – PT Clinic Running Costs
- FYZICAL Franchise – Startup Costs
- Peak Business Valuation – PT Value Drivers
- WebPT – PT Practice Startup Costs
- Petersen PT – Cost per Visit
- Business Wire – U.S. Physical Therapy Q1 2025 Results
- U.S. Physical Therapy – 2024 Q2 Earnings
- Net Health – PT Billing & Revenue KPIs
-Physical therapist business plan: complete guide
-How to open a physical therapy clinic in 12 steps
-Tools that increase revenue in a PT clinic
-How a PT clinic recovers its startup costs
-PT clinic budget: equipment and build-out
-How much income can a physical therapist clinic make?
-Physical therapist clinic profit margins explained
-Insurance reimbursement for physical therapy: timelines and tips
-Physical therapy market size and growth
-Rehabilitation services: 2025 trends