Stroke Rehabilitation Break-Even: About $106K Monthly Revenue

Fixed costs $18.3K/mo Base overhead

Contribution margin 84.5% After variable costs

Break-even revenue $21.7K/mo Revenue needed

Break-even timing Month 14 Model break-even

Break-even calculator

This calculator tests whether monthly revenue covers variable expenses and the fixed cost base.

Lean Base Full

Monthly revenue Revenue is the cash coming in each month before direct costs. $ Low sales High sales Variable expenses These are direct costs that rise as therapy volume grows. $ Light costs Heavy costs

Money available to cover fixed costs $180,909 $210,850 revenue - $29,941 variable expenses

Margin ratio

86%

Covers fixed costs

Yes

Fixed monthly costs This is the monthly cost base that margin must cover. $ Low overhead High overhead

Break-even chart Revenue Total costs

Which stroke rehabilitation expenses are fixed, and which move with treatment volume?

Cost classification

Break-even works only if fixed overhead, visit-linked fees, and hiring steps are separated. For this clinic, therapist payroll and revenue-based fees drive the biggest swing in Month 14 break-even risk.

Expense	Cost	Break-Even Treatment	Common Mistake
Therapist Payroll	Semi-fixed	Model by full-time equivalent hiring steps, starting with 2 physical therapists, 2 occupational therapists, 1 speech therapist, and 1 neuropsychologist in the first year.	Treating all clinical payroll as visit-level labor.
Facility Lease	Fixed	Use $12,000 per month from Month 1 through Month 60 in monthly break-even overhead.	Spreading facility build-out into monthly rent.
Third-Party Medical Billing Services	Variable	Apply 6.0% of first-year revenue, then step down to 4.0% by the mature year.	Ignoring denials, delays, or collection leakage.
Clinical Supplies	Variable	Apply 3.0% of first-year revenue, falling to 2.0% as purchasing scale improves.	Budgeting supplies as a flat monthly line.
Specialized Therapy Materials	Variable	Apply 1.5% of first-year revenue, falling to 1.0% by the mature year.	Missing therapy-specific materials in gross margin.
Electronic Health Record (EHR) & Patient Management Software	Fixed	Use $1,000 per month as recurring operating overhead.	Linking the full software fee to each visit.
Utilities	Fixed	Use $1,500 per month for the relevant planning range.	Scaling utilities in direct proportion to visits.
Marketing & Referral Incentives	Variable	Apply 5.0% of first-year revenue, declining to 3.0% as referral flow improves.	Treating acquisition spend as fixed overhead.

How does break-even change from lean setup to full scale in stroke rehabilitation?

Scenario table

Break-even improves fast as therapist load rises and fixed costs get spread over more visits. Lean Year 1 still runs short, Year 3 has clear cushion, and Year 5 is well above break-even unless reimbursement per session slips.

Planning cases only; actual results will move with payer mix, visit volume, and reimbursement per session.

Scenario	Monthly Revenue	Variable Costs	Fixed Costs	CM Ratio	Operating Profit	Break-Even Signal
Lean Year 1	$889K	$138K	$894K	84.4%	-$143K	Still below break-even, so every added visit matters.
Base Year 3	$2,869K	$367K	$1,511K	87.2%	$991K	Clear cushion, with fixed-cost spread doing the work.
Full Capacity Year 5	$5,794K	$580K	$2,156K	90.0%	$3,058K	Strong break-even buffer unless payer mix worsens.

What breaks first if referrals slow or payroll runs hot for a stroke rehabilitation clinic?

Stress test

At the Year 1 run-rate, the model is close enough to break-even that small misses matter. Here’s the quick math: about $889K of revenue against $894K of fixed costs leaves a roughly $169K gap, and a 10% miss can widen it fast.

Stress Case	Changed Assumption	Break-Even Revenue	Revenue Gap	Risk Signal
Current plan	No change.	$1.06M	$170K gap	Near break-even, so volume must hold.
Revenue shortfall	Revenue falls 10% from slower referrals and weaker collections.	$1.06M	$258K gap	Slow referrals can push the clinic deeper into loss.
Fixed-cost pressure	Fixed costs rise 10% from higher payroll and overhead.	$1.16M	$276K gap	Higher staffing cost can erase the Year 1 cushion.
Margin pressure	Variable expense rate rises from 15.5% to 18.5%.	$1.10M	$210K gap	Denials and weak collections cut contribution fast.
Combined pressure	Revenue falls 10%, fixed costs rise 10%, and variable expense rate rises to 18.5%.	$1.21M	$407K gap	One bad quarter can turn the plan deeply negative.

Can this stroke rehab clinic carry the lease, staffing, and equipment load before you commit?

Founder checklist

Before you sign the lease or buy equipment, prove referrals can fill the Year 1 schedule and cover the fixed load. The model needs $227K of cash, breaks even in Month 14, and only pays back in 38 months.

1Referral flow670/mo

Track referral sources until the opening pipeline can support 670 monthly treatments, because that is the demand base behind the Year 1 schedule.

2Fixed load$18.3K/mo

Before signing the lease, prove the clinic can carry $18.3K a month in fixed costs, including $12K rent from Month 1.

3Margin mix84.5% CM

Keep variable costs near 15.5% of revenue so contribution margin, or cash left after variable costs, stays near 84.5% before payroll and rent.

4Core staffing2-2-1-1-1 FTE

Validate enough referrals to support 2 physical therapists, 2 occupational therapists, 1 speech therapist, 1 neuropsychologist, and 1 rehab aide before buying the equipment.

5Cash cushion$227K cash

Hold at least $227K in cash, because the model bottoms out in Month 13 and only reaches breakeven in Month 14.

6Build-out phase$345K staged

Stage the $150K build-out, $80K gait system, $70K robotic arm, and $45K therapy gym before marketing spend so you do not lock in fixed cost ahead of referrals.