Business Planning

What an honest pro forma includes.

Twenty-four months of monthly projections, not a single-year summary. Two distinct phases inside the model: pre-revenue (the 6 to 12 months you're spending without billing) and post-launch (where revenue ramps unevenly).

Revenue assumptions: target patient volume by month, average revenue per visit by payer mix, and an explicit assumption about the credentialing lag (how many months until each payer pays you). Most pro formas assume payers pay on time. They don't.

Expenses: rent, EHR and billing software, telephony, insurance, staff (start light — owner plus one front-desk for most specialties), supplies, marketing. Add 15% to whatever number you land on for surprises.

Specialty and market drive almost everything.

Primary care in a saturated metro is a fundamentally different launch than specialty care in an underserved suburb. The cost structures, payer mix, patient volume curves, and competitive dynamics are not transferable.

Get local data. Use the Medicare Physician Fee Schedule Lookup at mymetolius.com/tools to model the actual codes you'll bill in your locality. Talk to two or three practices already operating in your specialty in your market — they'll tell you things no consultant can.

Working capital is not optional.

Six months of full operating costs, in cash, separate from startup capital. Most practices that fail in year one do so because they didn't reserve enough working capital for the credentialing lag plus normal A/R timing.

If you can't afford the reserve, the right answer is to launch later, launch leaner, or stay employed longer. Not launch under-capitalized.

Service mix and payer mix.

Service mix is what you'll do clinically. Payer mix is who pays for it. Both have to be modeled separately. A specialty practice with 60% Medicare and 30% commercial has a completely different economics from a 40% Medicare, 50% commercial mix — even with the same procedure list.

For most specialties in 2026, commercial payer mix below 40% makes a solo independent practice difficult. There are exceptions (concierge, DPC, cash-pay), but they require different planning.

When the math says wait.

Sometimes it does. The market is over-saturated. The payer mix doesn't support the model. The startup capital isn't there. The right answer is to adjust the plan: different location, different model (group instead of solo, DPC instead of fee-for-service), additional fundraising, or waiting six months and building a stronger foundation.

A delayed launch is cheap. A failed launch is not.