How Much Does It Cost to Start a Direct Care Practice?

Whether you are planning a direct primary care (DPC) practice, a concierge medicine clinic, a direct specialty care office, or a functional health practice, this is the question that comes before every other decision: how much is this going to cost? The answer depends on your model, your market, and a handful of choices that will shape your cost structure from day one. This guide breaks down the real numbers — not theoretical ranges pulled from a textbook, but the ranges we see when working with physicians who are actually making the leap.

What does a typical direct care practice cost to launch?

Most solo direct care practices launch for somewhere between $30,000 and $100,000 in total startup costs. That range is wide on purpose — a physician subleasing a single exam room in an existing clinic and keeping overhead minimal is in a fundamentally different position than one signing a multi-year lease and building out a full suite with in-house labs.

The three biggest variables are your space (lease vs. sublease vs. shared), your equipment needs (basic primary care vs. procedure-heavy or lab-heavy), and your cash runway (how many months of expenses you set aside before revenue reaches a sustainable level).

These ranges are starting points. Your actual number will depend on your local market, your clinical model, and the decisions you make in the categories below.

What are the biggest startup expenses?

The largest startup expenses for a direct care practice are office space, medical equipment, legal and entity formation, insurance, and cash runway.

Here is where the money actually goes. These are the major categories, with realistic ranges based on what we see across DPC, concierge, direct specialty care, and functional medicine startups.

Office space

This is usually the largest ongoing cost and one of the first decisions you will make. Your options range from subleasing a single room inside another provider's office to signing your own commercial lease and building out a custom space.

• Sublease or shared space: $1,000–$2,000/month. Lowest cost of entry. Common for DPC practices starting lean. You typically get an exam room and shared waiting area with minimal upfront investment.
• Standard commercial lease: $2,000–$4,000/month. Your own space, your own signage, your own build-out. Expect first and last month's rent plus a security deposit upfront — often $6,000–$12,000 before you see a single patient.
• Premium or build-to-suit: $4,000–$5,000+/month. More common for concierge practices in competitive markets or functional health practices that need space for infusion areas, dispensaries, or multiple treatment rooms.

Factor in build-out costs if you are starting from a raw or semi-finished space. Basic improvements — paint, flooring, reception desk, exam room setup — can run $5,000–$20,000 depending on how much work the landlord covers.

Medical equipment and supplies

What you need here depends entirely on your clinical model.

• Basic DPC setup: $5,000–$10,000. Exam table, otoscope/ophthalmoscope, blood pressure cuff, basic point-of-care testing supplies, and a modest initial supply stock.
• Mid-range with procedures: $10,000–$20,000. Add EKG, spirometry, minor procedure instruments, and a broader supply inventory.
• Functional medicine or lab-heavy: $15,000–$30,000+. In-house phlebotomy setup, IV infusion equipment, supplement dispensary inventory, specialty testing kits.

EMR and practice management software

Membership medicine practices have more options here than traditional fee-for-service clinics, and the costs are generally lower. Most DPC-focused platforms run $100–$300/month. Platforms with integrated membership billing, patient portals, and telehealth capabilities sit in the $200–$500/month range. Budget for setup fees where applicable — some charge a one-time onboarding fee of $500–$1,500.

Legal and entity formation

You need a legal entity (typically a PLLC or PC), an operating agreement, patient membership agreements, and potentially employment contracts down the road. Expect $2,000–$5,000 for a healthcare attorney to set up your entity and draft foundational documents. This is not the place to cut corners — a poorly structured entity or a membership agreement that does not hold up can create much larger problems later.

Insurance

Two policies are non-negotiable before you open the doors:

• Malpractice insurance: $3,000–$8,000/year for a solo primary care physician. Rates vary significantly by state, specialty, and claims history. Direct specialty care and concierge practices with broader scopes of service may sit at the higher end.
• General liability and property insurance: $500–$2,000/year. Covers slip-and-fall, property damage, and similar risks at your physical location.

Combined, plan for $3,500–$10,000/year in insurance costs, often due upfront or in quarterly installments.

Marketing and website

You need patients to know you exist. At launch, the most impactful marketing investments are typically a professional website, local SEO, Google Business Profile setup, and a basic awareness campaign.

• Website: $1,500–$5,000 for a professional site built for conversion. This is your digital front door — it needs to clearly explain your model, your pricing, and how to join.
• Brand and collateral: $500–$2,000. Logo, business cards, patient-facing materials.
• Initial marketing spend: $500–$2,000. May include local digital ads, community event sponsorships, or direct outreach to employers.

Total launch marketing budget: $2,000–$8,000. You can spend more, but most solo direct care practices do not need a large marketing budget at launch — they need a clear message and consistent local presence.

Technology

Beyond your EMR, you need the basics to run a modern practice:

• Laptop or desktop: $800–$2,000
• Phone system: $30–$100/month for a VoIP solution. Avoid locking into an expensive multi-line system before you need it.
• Payment processing: Most membership billing platforms include payment processing, but standalone merchant services typically charge 2.5–3.5% per transaction.
• Miscellaneous software: Accounting software, secure messaging, telehealth platform (if not bundled with your EMR). Budget $100–$300/month total.

Working capital and cash runway

This is the line item that separates practices that launch smoothly from practices that scramble. We will cover it in detail in the next section, but the short version: budget for three to six months of combined personal and practice expenses as a cash reserve before you open.

How much cash runway do you need?

Plan for six months of combined personal and practice expenses as a cash reserve before opening — for most solo direct care physicians, that means $30,000 to $60,000 in working capital alone.

Here is the math that matters. Add up two numbers:

1. Monthly practice expenses: Rent, software, insurance premiums, supplies, loan payments, and any staff costs. For a typical solo DPC, this is $3,000–$8,000/month.
2. Monthly personal expenses: Mortgage or rent, food, transportation, health insurance, and any other personal financial obligations. Be honest about this number.

Multiply the combined total by six. That is a realistic cash runway target. If you can set aside that amount before you leave your employed position, you have enough buffer to build your panel without financial panic driving clinical or business decisions.

For many physicians, the cash runway alone accounts for $30,000–$60,000 of their total startup budget. That is why it is the single most important number in your launch plan — and the one that gets underestimated most often.

How the model changes the math

Not all direct care practices are built the same way, and the startup cost structure varies significantly depending on which model you are building.

DPC with low overhead

The leanest direct primary care practices launch with a sublease, basic equipment, and minimal staff. Overhead stays low, and the path to profitability is shorter because fixed costs are manageable even with a small panel. Total startup costs typically land in the $30,000–$50,000 range. The trade-off is a smaller, simpler space and a more limited service offering at launch.

Concierge medicine with premium positioning

Concierge practices often invest more heavily in the patient experience — a polished office, higher-end furnishings, and a staffed front desk from day one. The build-out costs are higher, but so are the membership fees. If you are charging $200–$500+/month per member, you reach break-even with a smaller panel, but you need more upfront capital to create the experience that justifies the price. Budget $80,000–$150,000+ for this model.

Functional medicine with dispensary and labs

Functional health practices have a unique cost profile. Beyond the standard office and equipment, you are often investing in supplement inventory (dispensary or drop-ship setup), specialty lab accounts, and potentially IV infusion equipment. These are revenue-generating assets, but they require upfront capital. A functional medicine startup with in-house dispensary and lab capabilities can easily run $80,000–$150,000+, though the ancillary revenue potential is also higher than a straightforward DPC model.

How can you reduce your startup costs?

The most effective ways to reduce startup costs are subleasing space, starting part-time while still employed, using a virtual receptionist, and purchasing used equipment.

You do not have to spend $100,000 to open a direct care practice. Many of the most successful DPC, concierge, and functional health practices we work with launched lean and invested as revenue allowed. Here are the most effective ways to reduce your initial outlay:

• Sublease from another provider. This is the single biggest cost reducer. You avoid a commercial lease, a build-out, and most furnishing costs. Many physicians, dentists, and allied health providers have unused space they are happy to rent by the day or month.
• Start part-time while still employed. Some physicians launch their direct care practice on evenings and weekends before leaving their employed position. This lets you build an initial patient base and test your model while you still have a paycheck. Not every employment contract allows this — check your non-compete and moonlighting policies first.
• Use a virtual receptionist. A virtual answering service at $200–$500/month can handle phone calls, scheduling, and patient intake without the cost of an in-office hire. This is one of the most common and effective early-stage decisions in DPC practices.
• Purchase used or refurbished equipment. Exam tables, diagnostic instruments, and office furniture can often be sourced from practices that are closing or upgrading. Medical equipment resale marketplaces and local practice liquidations can cut equipment costs by 40–60%.
• Launch with a minimal viable practice. You do not need a full-service clinic on day one. Start with the services that matter most to your initial patients, and add capabilities as your panel and revenue grow. The goal is to open the doors, not to build the final version of your practice before seeing your first member.
• Negotiate your lease. Landlords in medical office buildings often offer tenant improvement allowances, free rent periods, or graduated rent schedules for new practices. These concessions can reduce your upfront costs by thousands of dollars — but only if you ask.

A simple startup budget framework

You do not need a complex financial model to plan your launch. Start by estimating your costs in each of the categories below, then add them up. This gives you a clear picture of what you need to raise, save, or borrow before you sign a lease or file your entity paperwork.

Once you have your total, compare it to your available resources: savings, a line of credit, a practice startup loan, or a combination. Knowing the number — even a rough one — removes the uncertainty that keeps many physicians stuck in the planning phase longer than necessary.

The bottom line

The total dollar amount matters less than having a plan that accounts for it. Physicians who launch successfully are not necessarily the ones with the biggest budgets — they are the ones who know their burn rate, know their break-even patient count, and have built a realistic timeline to sustainability.

Break-even for a solo DPC practice typically happens at 75–150 members, depending on your membership price and overhead. At a reasonable growth rate of 10–20 new members per month, that is 4–15 months. Your startup budget needs to carry you through that window.

If you do the math and the number feels too high, go back to the line items. What can you sublease instead of lease? Where can you start with a simpler version and upgrade later? Which costs are truly necessary before you see your first patient, and which can wait until month three or month six?

The goal is not to minimize spending. It is to spend intentionally, with a clear understanding of what each dollar is buying you and when you expect to see a return on it. That is the difference between a launch that feels controlled and one that feels like a scramble.

Frequently asked questions

Q: How much does it cost to start a DPC practice?

A: Most solo direct primary care practices launch for $30,000 to $100,000 in total startup costs. A lean launch with a sublease and minimal build-out runs $30,000 to $50,000, a typical solo DPC with its own lease costs $50,000 to $80,000, and a full build-out for concierge or functional medicine with labs runs $80,000 to $150,000 or more.

Q: How much cash runway do I need to start a direct care practice?

A: Plan for six months of combined personal and practice expenses as a cash reserve before opening. For most solo direct care physicians, this means $30,000 to $60,000 in working capital alone. This is the most commonly underestimated startup cost.

Q: How long does it take for a DPC practice to break even?

A: Most solo DPC practices break even at 75 to 150 members, depending on membership price and overhead. At a typical growth rate of 10 to 20 new members per month, that is 4 to 15 months from launch.

Q: Can I start a DPC practice for under $50,000?

A: Yes. By subleasing space from another provider, purchasing used equipment, using a virtual receptionist, and launching with a minimal viable practice, many DPC physicians launch for $30,000 to $50,000 in total startup costs.

Q: What is the biggest startup cost for a direct care practice?

A: Cash runway — the reserve needed to cover personal and practice expenses while your membership panel builds — is typically the largest single startup cost, often $30,000 to $60,000. Many physicians underestimate this because they focus on equipment and build-out costs instead.

Have fun and make a difference.
— Tom

This article is for informational purposes only and does not constitute legal, tax, or financial advice. Osprey CFO is not a tax firm — we provide financial strategy, not tax preparation or tax advisory services. Consult with qualified professionals for guidance specific to your practice, jurisdiction, and financial situation.