Mental Health Clinic Break-Even Analysis: $168K Monthly Revenue

Fixed costs $144.1K/mo Year 1 base

Contribution margin 86% After variable costs

Break-even revenue $167.6K/mo Monthly target

Break-even timing Month 14 First hit

Break-even calculator

Test how monthly revenue, variable expenses, and fixed costs shape the clinic's break-even point.

Lean Base Full

Monthly revenue Revenue sets the pool available to cover variable and fixed costs. $ Slower load Busier load Variable expenses These costs rise with patient volume and service mix. $ Lower costs Higher costs

Money available to cover fixed costs $351,124 $400,826 revenue - $49,702 variable expenses

Margin ratio

88%

Covers fixed costs

Yes

Fixed monthly costs This is the monthly cost base that contribution margin must cover. $ Lean setup Larger setup

Break-even chart Revenue Total costs

Which mental health clinic expenses are fixed, and which move with session volume?

Cost classification

Break-even is reliable only when fixed overhead stays out of per-session math and true variable fees move with revenue or visits. Classify each expense before calculating the Month 14 break-even target.

Expense	Cost	Break-Even Treatment	Common Mistake
Clinic Rent ($10,000/month)	Fixed	Include in monthly overhead from Month 1 through Month 60.	Tying rent to session count.
Utilities ($1,800/month)	Semi-fixed	Hold mostly flat until clinic footprint or operating hours change.	Modeling utilities as per-session spend.
Clinic Insurance ($1,200/month)	Fixed	Keep in overhead and separate from billing-related fees.	Blending insurance into variable billing expense.
Electronic Health Record Platform Subscription ($1,500/month)	Semi-fixed	Keep flat until user count or plan tier steps up.	Treating chart software as a revenue percentage.
Office Supplies & Maintenance ($700/month)	Semi-variable	Split between base clinic upkeep and visit-driven supplies.	Classifying the full amount as fixed overhead.
Billing Service Fees	Variable	Apply the first-year 2.5% assumption to revenue, then use the yearly rate.	Putting billing fees into fixed overhead.
Marketing & Client Acquisition	Variable	Apply the first-year 8.0% assumption as volume-linked demand spend.	Treating marketing as only launch spend.
Provider Salaries	Semi-fixed	Add salaries in full-time-equivalent blocks as clinicians are hired.	Modeling all providers as per-session contractors.

How does break-even change from a lean clinic to a full clinic?

Scenario table

The lean case misses break-even because fixed rent and payroll outrun the session load. By Year 2, revenue covers those costs, and the full case adds a much larger cushion as provider volume rises faster than variable spend.

Planning assumptions only; actual results will move with referral flow, staffing pace, and completed session volume.

Scenario	Monthly Revenue	Variable Costs	Fixed Costs	CM Ratio	Operating Profit	Break-Even Signal
Lean Year 1 clinic	$1.588M	$222K	$1.441M	86.0%	-$75K	Still below break-even, so this case needs more referrals.
Base Year 2 clinic	$2.586M	$341K	$1.787M	86.8%	$458K	Clears break-even with a solid cushion.
Full Year 3 clinic	$4.008M	$497K	$2.335M	87.6%	$1.176M	Break-even risk is low if the clinic can keep sessions filled.

What breaks the clinic’s break-even plan first?

Stress test

Year 1 is tight: $1,588K revenue against $1,441K fixed costs and payroll leaves only a $75K operating gap. A 10% revenue drop, a 3-point margin squeeze, or a 5% fixed-cost rise pushes that gap into six figures fast, especially if sessions slow or reimbursement slips.

Stress Case	Changed Assumption	Break-Even Revenue	Revenue Gap	Risk Signal
Current plan	No change.	$1,677K	$75K gap	Tight but workable if sessions stay full.
Revenue shortfall	Revenue falls 10% to $1,430K.	$1,677K	$211K gap	Slower sessions or weaker intake widen the hole fast.
Fixed-cost pressure	Fixed costs rise 5% to $1,513K.	$1,760K	$147K gap	Lease, utilities, or payroll creep eats the cushion.
Margin pressure	Contribution margin slips from 86% to 83%.	$1,736K	$124K gap	Higher provider payout or lower reimbursement cuts room to breathe.
Combined pressure	Revenue falls 10%, margin drops to 83%, and fixed costs rise 5%.	$1,823K	$327K gap	This is the red-flag case; the plan has no room for misses.

Is the clinic ready to sign the lease and open?

Founder checklist

Don’t sign the lease or scale hiring yet. First prove the clinic can support 1,051 completed sessions a month, hold 86% contribution margin, and keep at least $361K in cash through Month 13, because Year 1 EBITDA is still negative $327K.

1Session proof1,051/mo

Verify the clinic can consistently close at least 1,051 completed sessions a month, because that is the demand floor before the lease and hiring plan make sense.

2Pipeline target996/mo

Check the referral pipeline can beat the Year 1 plan of 996 sessions a month, or opening-month utilization will miss the break-even ramp.

3Fixed load$139.5K/mo

Add the $10,000 lease to about $16.6K of monthly overhead and about $122.9K of monthly wages, and make sure the revenue plan can carry that load.

4Margin check86% CM

Test that prices stay in the $130 to $250 range and that billing, assessment, marketing, and telehealth costs stay near 14% of revenue, leaving about 86% contribution margin.

5Capacity ramp50%-65%

Confirm Year 1 capacity assumptions of 50% to 65% are realistic for each provider type, because staffing and scheduling need to fill before marketing spend scales.

6Cash runway$361K

Keep at least $361K in cash before opening commitments and the $270K launch build-out, since the cash trough falls in Month 13 and Year 1 EBITDA is negative $327K.