Practice Overhead Calculator
Know your exact overhead burden before you set any fees or accept any contracts.
| Cost | Monthly | % of overhead |
|---|
What is the Practice Overhead & Profitability Calculator?
The Practice Overhead & Profitability Calculator shows solo practitioners exactly where revenue goes — rent, software, insurance, licensing, admin help — and what their true profit per session or client-hour is after every operating cost.
How is it calculated?
Enter monthly revenue and each overhead category: rent, EHR/practice software, malpractice insurance, licensing and CE, marketing, and support staff. The calculator computes your overhead ratio, profit margin, and true cost per session — the floor your fees must clear.
Worked example: What must a solo therapist charge per session to cover $1,240 of overhead and take home $6,000?
- Add up fixed monthly costs
Rent $800 + insurance $150 + EHR $80 + phone/internet $60 + continuing ed $50 + other $100 = $1,240 in overhead that hits your account every month whether or not you see a single client.
- Find your break-even rate per session
Spread that overhead across your 60 billable sessions: $1,240 / 60 = $20.67 per session (the tool rounds to $21). That’s what each session must cover before you earn a dime.
- Add your take-home goal
You want $6,000 in your pocket, so the practice needs to bring in $1,240 + $6,000 = $7,240 in gross fees this month.
- Divide by your capacity for the minimum rate
$7,240 / 60 sessions = $120.67, which the tool shows as $121. Charge below that at 60 sessions and you miss either the overhead or the paycheck.
- Check the overhead ratio
$1,240 / $7,240 = 17% of every dollar you collect goes straight to keeping the doors open, before taxes.
- Verdict
At 60 sessions you must average at least $121/session. If your rate is $130, you clear your goal with a small cushion; if it’s $110, either raise fees or add sessions.
How many sessions do you need at each average fee?
| Average fee / session | Sessions to break even | Sessions to hit $6k take-home | Verdict |
|---|---|---|---|
| $80 | 16 sessions | 91 sessions | Above realistic capacity |
| $100 | 13 sessions | 73 sessions | Tight but doable |
| $120 | 11 sessions | 61 sessions | Matches ~60/mo capacity |
| $150 | 9 sessions | 49 sessions | Comfortable margin |
| $200 | 7 sessions | 37 sessions | Room to cut hours |
Frequently Asked Questions
What is a normal overhead ratio for a solo practice?
Solo therapy and counseling practices typically run 25–40% overhead; solo law offices 35–50%; medical and dental far higher. Telehealth-only practices can dip under 20%. If overhead passes 50% without staff leverage, rent or software stack is usually the culprit.
How do I calculate my cost per session?
Divide total monthly overhead by sessions delivered. A practice with $3,500 of monthly overhead delivering 100 sessions carries $35 of cost per session — so a $60 sliding-scale fee earns $25, not $60. Every pricing decision should sit on top of this number.
Which overhead costs can a solo practitioner cut first?
Audit software subscriptions (the average solo practice pays for 8–12 tools and actively uses half), renegotiate or downsize office space given telehealth mix, and re-shop malpractice and business insurance every two years. Most practices find 10–20% of overhead is remove-able without touching care quality.
Is my practice actually profitable if I’m paying myself?
Separate owner pay from profit. Pay yourself a market salary for the clinical work, then measure what’s left as true practice profit. A practice that only breaks even after a below-market owner draw is subsidized by you — the calculator makes that visible.
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