8 Numbers Every Practice Owner Should Know
When I talk with therapists and private practice owners, I hear the same thing a lot: "I know roughly what's coming in, but I couldn't tell you what I'm actually making." That's not a flaw. You got into this work to help people, not to stare at spreadsheets. Still, your numbers are telling a story about your practice, and it's worth learning to read it.
These are the numbers I review with my clients every month. Here are the eight I'd want every practice owner to know.
1. Revenue
Everything your practice brings in before expenses: client payments, insurance reimbursements, workshop fees. Watch it month to month so you can see whether you're growing, holding steady or slipping, and whether there's a seasonal dip you can plan for.
2. Profit
What's left after expenses. If you collected $15,000 this month and spent $12,500 on rent, your EHR, supervision, insurance and everything else, your profit is $2,500. That's the number that pays you and builds your cushion.
3. Expenses
Look at them at least once a month. Software subscriptions are the usual culprit: an old telehealth platform, a scheduling tool you replaced, a course membership you forgot about. Small charges add up fast.
4. Cash flow
This is the timing of money coming in and going out. A practice can be profitable on paper and still feel broke if insurance payments lag 45 days while rent is due on the 1st.
5. Money owed to you
Unpaid client balances and insurance claims that haven't been paid yet. For a lot of therapists, this is the biggest leak. Claims sitting past 30 days deserve a follow-up, and denied claims need a decision: resubmit, appeal or bill the client.
6. Money you owe
Upcoming bills, credit card balances and loan payments. Knowing what's coming lets you plan instead of react.
7. Profit margin
Your profit divided by your revenue. If you're keeping $2,500 out of $15,000, your margin is about 17%. Seeing more clients is great, but you also want to know you're keeping more of what you earn.
8. Taxes
If you're self-employed, no one is withholding taxes for you. Set aside a percentage of every deposit in a separate account, and work with your tax preparer on quarterly estimates so April isn't a shock.
A note for nonprofit leaders
The same ideas apply, with a twist. Instead of profit, you're watching your surplus or deficit. You also need to know which dollars are restricted to a specific program or grant and which you can use freely. Your board will thank you.
Where to start
You don't need to track all eight this week. Pick two, maybe profit and money owed to you, and look at them every month. Once your books are accurate and up to date, the rest gets a lot easier to see.
If you'd like help getting your books organized so these numbers are easy to find, I'd love to talk.
