What does opening a physical therapy clinic cost?
Illustrative case · Small outpatient physical therapy practice; two licensed PTs; retained leased medical suite; no home care · California, United States; no city or site selected
Explore this business · Startup costs
The reference opening budget is $260,000, including $120,000 of working cash. Its two largest non-reserve commitments are $45,000 of retained-suite alterations and $26,000 of rehab equipment; both remain unquoted project allowances. The checked base cash path requires $11,352 beyond the modeled funding. Treat the budget as a scope-and-timing worksheet until the site, delivered equipment and payer contracts are priced.
Define the retained-site condition before pricing
This case assumes 1,600 square feet already usable for a medical/therapy tenant, an existing accessible restroom, serviceable HVAC and sufficient electrical supply. It adds two treatment stations, privacy separation, an exercise zone, reception and secure records. It excludes purchase of real estate, a cold shell, major structural work, a pool and surgical or imaging infrastructure. No actual address has been selected. A shell proposal belongs to a new cost scope and needs a new model input.
Obtain the landlord responsibility schedule before calling any area usable. Inspect entry and parking access, doors, transfers, clearances, patient privacy, ventilation, electrical capacity, fire/occupancy approvals and local permitted use. A table with adjustable height does not certify the entire facility. The official guidance supports that inspection; it does not supply a construction price. Access to medical care
Read every use by accounting and evidence scope
| Use | Amount | Evidence/accounting status | Measured scope or next confirmation |
|---|---|---|---|
| Retained-suite fit-out | $45,000 | Unquoted allowance; no shell conversion | Two treatment stations, exercise/reception area; survey and installed bid needed |
| Rehab equipment | $26,000 | Complete-package allowance; component price only | Two plinths, cycle, rail station, stools/carts and small tools |
| IT and reception furniture | $11,000 | Unquoted installed allowance | Three secure workstations/network and reception furniture |
| Recoverable lease deposit | $9,800 | Asset; actual terms unknown | 2 months of modeled all-in rent |
| Opening annual premises policy | $4,800 | Prepaid asset, renewed annually | Separate from ongoing malpractice/cyber budget |
| Professional/credentialing setup | $9,000 | Preopening expense allowance | Entity/legal/license/enrollment work; actual fees needed |
| Paid preopening setup work | $15,000 | Preopening expense allowance | Role-by-week payroll and burden not quoted |
| Opening consumables | $2,400 | Inventory asset | Used before replacement cash purchases; no double-counting |
| Launch marketing | $5,000 | Preopening expense allowance | No referral conversion or patient demand proven |
| Commissioning/contingency | $12,000 | Fully expensed and spent before opening | Conservative case; not another available reserve |
| Available opening cash | $120,000 | Reserve after all above uses | Receivables, ramp payroll and scheduled debt timing |
| Total opening uses | $260,000 | Case total, not a market estimate | Base funding has a later shortfall of $11,352 |
All items are funded before trading month one. Fit-out, equipment and IT form $82,000 of management CAPEX. Deposit, prepaid policy and opening inventory remain assets; setup, paid launch work and commissioning are expensed before opening. The reserve is what remains in cash after these uses. No supplier deposit is silently funded twice.
Reserve follows the monthly collection path
Opening payroll, rent and outsourced billing do not wait for remittances. The base case starts with $120,000 but draws $131,352 at its deepest point. A mechanical reserve of $131,352 would bring the lowest base cash position to zero under exactly these assumptions. It would raise total startup funding to $271,352 and equity to $111,352 if debt stays unchanged. This sensitivity has no safety buffer and does not make the lower case viable.
List deposits, credentialing dates, opening cash and the first annual premises-policy renewal on one calendar. Insurance collections use service-month cohorts; no revenue is recognized before a visit occurs, and no preopening patient balance is assumed. The scenario cash tables retain negative balances. Delaying an employee start changes capacity and demand delivery as well as payroll; it needs a different checked roster, not an unexplained savings line.
Investigate the largest commitments in their actual scope
The fit-out allowance covers the retained-suite adaptation, not a whole medical building. Use measured plans and a trade responsibility matrix for partitions/privacy, finishes, power/data, accessible route corrections and commissioning. There is no verified unit price for those trades, so dividing the allowance by floor area cannot turn it into a supported cost benchmark. Ask for taxes, permits, demolition, landlord work, payment milestones and exclusions in the installed bid.
For equipment, an inspected Rehabmart listing shows an Armedica AM-300 base table at $2,592.74; two tables give $5,185.48 before unconfirmed tax, freight and placement. Forest-green upholstery is listed without an additional option charge. That subtotal supports a component comparison only. The complete $26,000 allowance also includes a cycle, parallel-bar station, carts/stools and small rehab/transfer tools, whose delivered prices have not been obtained. No residual balance is presented as a quote for the missing items. Exact table listing
The third large commitment is $15,000 of paid setup work. Price the actual owner, employed therapist and administrator weeks, training and burden. The BLS wage comparison helps test salaries but cannot establish the number of paid credentialing weeks. Unresolved opening dates can consume reserve before patients arrive.
Resolve gaps before calling the budget funded
Actual local lease terms, utility connections, delivered equipment, contractor scope, permit charges, entity/tax structure, professional insurance and payer enrollment are unresolved. CAPEX allowances intend to cover installed costs but do not prove that the amounts include every tax, delivery or fee. Personal/entity income taxes, tax depreciation, future expansion CAPEX and financing closing fees are outside the model and need explicit additions when known.
Keep blanks in the quote register until evidence arrives. Record supplier/configuration, quantity, delivery destination, tax, installation, validity, deposit and balance due. Then update the original inputs and rerun all three scenarios. An unchanged total pasted into several pages is not evidence that a clinic can open for that amount.
Validate the case inputs
Download the input and evidence register (CSV). This case export separates observed context from assumptions and leaves quotation fields blank for your project. It is an educational register, separate from the planned personalized model.
Sources and scope
- Case assumptions and existing planning-case methodology · Checked 2026-10-05 · Author-selected outpatient case. No signed lease, patient referrals, insurer contract or project quotation. All case rates, mix, demand and timing remain assumptions.
- Physical therapists — Occupational Outlook Handbook · Checked 2026-10-05 · May 2025 national median annual employee wage, USD 102760; page modified August 27, 2026. Excludes self-employed pay; does not establish California hiring or owner compensation.
- Physical Therapy Board of California — practice laws and consumer FAQ · Checked 2026-10-05 · California PT/PTA/aide roles and license verification. This case employs two licensed PTs and no assistants/aides; no practitioner credential or site approval has been received.
- California Business and Professions Code 2620.1 · Checked 2026-10-05 · California direct-access treatment; effective January 1, 2023 amendment displayed. Selected adult outpatient treatment excludes the wellness and education-plan exceptions.
- CMS Therapy Services — CY2026 updates · Checked 2026-10-05 · Outpatient therapy coding/payment framework; current page discusses 2026 updates, KX and MPPR. No locality/CPT/modifier fee calculation performed; modeled Medicare visit receipts are assumptions.
- CMS medical bill rights when not using insurance · Checked 2026-10-05 · Uninsured/self-pay good-faith estimate information. Does not authorize private contracts for otherwise covered Medicare services.
- Access to medical care for people with mobility disabilities · Checked 2026-10-05 · Federal medical-facility accessibility guidance, updated June 26, 2020. Supports a survey of usable access, transfer equipment and space, not a construction budget or site certification.
- Rehabmart Armedica AM-300 treatment table listing · Checked 2026-10-05 · Observed October 5, 2026: ARM-AM-300 / MPN AM-300, base table 2592.74 USD, forest-green option ARM-3 displayed 0 additional charge. No optional upgrades/coupon. Listed price is not a delivered/installed clinic quote.
- Publication 15 (2026) — employer tax guide · Checked 2026-10-05 · 2026 federal payroll tax components. The case 15 percent all-in burden includes other assumed costs and is not a statutory combined tax rate.
- SBA 7(a) loans · Checked 2026-10-05 · Program purposes and application through lenders. The model loan is illustrative; no approved terms, equity rule or applicant approval probability is asserted.
- SBA 504 loans · Checked 2026-10-05 · Long-term major fixed assets and CDC route; not working capital/inventory. Separate from illustrative ten-year general term loan.
- SBA 7(a)/504 FOIA data — verified June 2026 snapshot · Checked 2026-10-05 · Existing hash-verified aggregates, cutoff June 30, 2026. Approval FY2023–FY2025, NAICS 621340, PIF/CHGOFF/EXEMPT statuses. Whole therapy/audiology industry; no borrower rows copied.
- Census NAICS 621340 industry description · Checked 2026-10-05 · 2022 NAICS broad offices of physical, occupational and speech therapists and audiologists. The narrow model is outpatient physical therapy only.