Palliative Care Break-Even Analysis: Month 37 Revenue Plan

Fixed costs $130.7K/mo Base overhead

Contribution margin 90% After variable spend

Break-even revenue $145.2K/mo Monthly target

Break-even timing Month 37 Model break-even

Break-even calculator

Compare monthly revenue, variable expenses, and fixed monthly costs to see where palliative care operations hit break-even.

Lean Base Full

Monthly revenue Revenue sets the cash pool available to cover direct and fixed costs. $ Lower sales Higher sales Variable expenses These rise with patient volume and care delivery. $ Lean costs High costs

Money available to cover fixed costs $80,503 $88,563 revenue - $8,060 variable expenses

Margin ratio

91%

Covers fixed costs

$201,447 short

Fixed monthly costs This is the monthly overhead the margin must cover. $ Lean overhead Heavy overhead

Break-even chart Revenue Total costs

Which palliative care expenses are fixed and which move with patient volume?

Cost classification

Break-even is only useful if fixed overhead, volume-linked fees, and staffing steps are kept separate. In this model, the Month 37 break-even depends most on clean treatment of salaries, rent, supplies, mileage, billing fees, and patient acquisition.

Expense	Cost	Break-Even Treatment	Common Mistake
Office Rent	Fixed	Include $8,000 per month in overhead from Month 1 through Month 60.	Treating rent as patient-volume driven and understating the monthly break-even floor.
Medical Malpractice Insurance	Fixed	Include $2,000 per month from the launch month, regardless of visit volume.	Adding it only after revenue ramps, which makes early losses look too low.
EHR System Subscription	Fixed	Include $1,500 per month as recurring operating overhead.	Putting the subscription in variable fees instead of monthly overhead.
Physician and Nurse Practitioner Salaries	Semi-fixed	Step up with the staffing plan: 2 physicians and 3 nurse practitioners in the first year, rising to 8 and 12 by the fifth year.	Spreading salaries as a percent of revenue instead of adding staff in capacity blocks.
Social Worker, Chaplain, and Counselor Salaries	Semi-fixed	Step up as the care panel grows, from 4 total FTE in the first year to 16 total FTE by the fifth year.	Assuming support care labor scales smoothly with each visit.
Clinical and Medical Supplies	Variable	Model as 2.0% of revenue in the first year, falling to 1.8% by the fifth year.	Putting supplies in fixed overhead and missing visit-level margin pressure.
Transportation Costs	Variable	Model as 3.0% of revenue in the first year, falling to 2.6% by the fifth year.	Ignoring mileage and travel time until home-based volume strains cash.
Billing Software Transaction Fees	Variable	Model as 2.0% of revenue in the first year, falling to 1.6% by the fifth year.	Treating all billing software spend as fixed and overstating contribution margin.

How does break-even shift from a lean launch to full capacity in palliative care?

Scenario table

As capacity rises from 65% to 85%, revenue outpaces the fixed payroll base, so the business moves from a monthly loss to a cushion. Payer mix isn't provided, so collected price is the proxy here.

Planning case figures use the model assumptions above; they are not guarantees, and collected price is used as the proxy because payer mix isn't provided.

Scenario	Monthly Revenue	Variable Costs	Fixed Costs	CM Ratio	Operating Profit	Break-Even Signal
Lean launch case	$109.2k	$10.9k	$127.4k	90.0%	-$29.1k	Still below break-even, so a small demand dip hurts fast.
Base run-rate case	$372.8k	$37.3k	$281.9k	90.0%	$53.6k	Near the model's Month 37 payback point, so collections need to stay tight.
Full capacity case	$691.2k	$69.1k	$412.0k	90.0%	$210.1k	Clear cushion above break-even, so it can absorb more fixed cost.

What breaks the break-even plan if referrals slow or costs run hot?

Stress test

The plan breaks first on timing, not demand size. Year 1 revenue is $1,092k against $1,452k break-even, so billing lag, denied claims, long travel routes, or hiring ahead of referrals can push Month 37 break-even out again.

Stress Case	Changed Assumption	Break-Even Revenue	Revenue Gap	Risk Signal
Current plan	No change.	$1,452k	$360k gap	Month 37 break-even leaves a long cash drag.
Revenue shortfall	Year 1 revenue falls 10% to $983k.	$1,452k	$469k gap	A modest referral miss widens the funding hole fast.
Fixed-cost pressure	Annual payroll or overhead rises by $100k.	$1,563k	$471k gap	A six-figure cost creep adds real revenue pressure.
Margin pressure	Variable expenses rise 1 percentage point.	$1,469k	$377k gap	Even a small fee or billing drag matters here.
Combined pressure	Revenue falls 10%, payroll or overhead rises $100k, and margin slips 1 point.	$1,581k	$598k gap	Slower referrals plus higher wages can push Month 37 later.

Before you sign the lease and hire the full care team, have you proved the break-even math?

Founder checklist

Do not lock in the full clinic unless referral flow, payer setup, and billing all work on paper and in a live test. The model shows about $78K monthly Year 1 revenue against about $130.7K of monthly payroll and overhead, with breakeven only in Month 37 and a $524K cash trough in Month 36.

1Referral base$78K/mo

Prove referral sources can support about $78K a month in Year 1 before you hire the full team, because that is the revenue base the model needs.

2Cost load$130.7K/mo

Challenge the $215K launch capex and the $130.7K monthly payroll-plus-overhead load before you sign, because the $75K buildout and $40K equipment spend hit before patients do.

3Direct margin90% CM

Check contribution margin, the share left after direct costs, stays near 90% after supplies, transport, fees, and acquisition, so it can fund wages and overhead.

4Staffing ramp65% load

Keep the opening schedule at the 65% load plan until handoffs and visits run cleanly, because Year 1 assumes each discipline starts below full capacity.

5Billing flowPre-volume

Test payer setup, visit routing, claims, and payment posting on live cases first, so billing works before you add travel and headcount.

6Cash trough-$524K

Hold enough reserve to cover the $524K minimum cash point in Month 36, because breakeven lands in Month 37 and EBITDA stays negative through Year 3.