Financial fitness for physicians

For much of my training, the idea of hanging a shingle and starting a private practice felt almost mythical— something people used to do, not something you could realistically pursue. That’s starting to change. With the rise of micropractices and direct primary care (DPC), more physicians are choosing to build something of their own and asking an important question: How much does it cost to start a direct primary care practice?

Starting a practice is both an opportunity and a risk. DPC, in particular, offers a refreshing alternative. By removing insurance billing and replacing it with a simple membership model, it creates the potential for lower overhead, more autonomy and stronger relationships with patients. But although the model simplifies a lot of things, it doesn’t eliminate the financial realities of starting a business.

As a physician who recently launched a DPC practice in New York’s capital region, I had to think not just like a doctor, but like a business owner.

Understanding the DPC cost structure

In traditional primary care, overhead can easily consume 60–70% of revenue. A large part of that comes from staffing, billing infrastructure and the administrative complexity required to interact with insurance companies. DPC changes that equation.

Because you’re not billing insurance, you can run a much leaner operation. You don’t need a large billing team. You don’t need layers of administrative support. And your revenue becomes more predictable through monthly membership fees.

Startup costs: A lean but strategic investment

When I launched my practice, I was very intentional about staying lean—but also thoughtful about the patient experience.

A budget of $30,000-$70,000 is reasonable for a lean, well-designed primary care clinic, though it can vary depending on location, how much build-out is needed and how quickly you choose to scale. Costs to plan for include:

•Monthly rent: $1,500-$5,000, depending on market

•Security deposit, leasehold improvements and furnishings: $20,000-$100,000, depending on how much work the space needs

•Malpractice insurance: $3,000-$12,000 annually

•General liability insurance: $500-$3,000 annually

•Equipment and technology: $5,000-$10,000 for a basic setup

•EHR and practice management software: $250-$500 a month

•Legal costs (entity formation, contracts, lease review): $1,500-$5,000+

Staffing and operation design

Early on, I chose to do a lot myself: clinical workflows, administrative tasks, patient communication, cleaning, painting—you name it.

That decision wasn’t just about saving money—it was about keeping things simple and building the kind of experience I wanted for my patients.

Of course, this isn’t a forever plan. As your panel grows, you’ll likely want support. But starting lean gives you the flexibility to grow intentionally, rather than being locked into high fixed costs from day one.

Marketing and patient acquisition

Unlike traditional employed models where patients are largely built into the system, DPC requires you to actively build your own panel. That means earning trust before someone ever walks through your door.

There are some upfront costs to doing this well:

•Website development and branding: $1,500-$5,000

•Digital marketing and social media presence

Building a DPC practice is as much about relationships as it is about medicine. Showing up consistently, educating your community and letting people get to know you is ultimately what drives growth. That kind of trust doesn’t happen overnight, but it’s what makes this model so powerful.

The critical variable: Time to profitability

Perhaps the most overlooked financial consideration when starting a DPC practice is the time it takes to build your patient panel. Even with strong demand, it can take several months—and sometimes over a year—to reach truly sustainable revenue. During that time, you’re still responsible for both your business expenses and your personal financial needs. Having adequate cash reserves is essential.

Financial risk and long-term opportunity

Starting a DPC practice also means stepping fully into both financial and operational risk.

You’re investing your own capital, walking away from a guaranteed paycheck and taking on the responsibility of running a business on top of practicing medicine. That’s a big shift. On the other side of that risk is something incredibly powerful: control over your schedule, your practice structure and how you care for your patients. •