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January 16, 2013

Member asks: How long does it take for an urgent care clinic to break even?

Daily Briefing

If we establish a new urgent care clinic, how long does it take to break even on our investment?

That's a great question, and one that we're getting from lots of members. Here's our qualified answer, based on conversation with members and literature review: it can take a brand-new urgent care clinic (UCC) up to three years to break even.

There are several key factors that affect when UCCs will begin to realize a return on investment, such as payer mix and patient awareness of the clinic.

Often, these sites are most helpful in terms of improving access for patients and potentially attracting downstream visits for the hospital or health system. As a result, many systems use UCCs to secure a steady referral stream as opposed to securing profits.

That said, the Marketing and Planning Leadership's research found that the average UCC is capable of generating $118 in revenue per patient, according to the Urgent Care Association of America's 2010 Urgent Care Benchmarking Report.

Include lucrative ancillary services, routine services

Ultimately, breaking even or even generating profits is possible with sufficient demand. To boost profitability, it helps to co-locate high-margin ancillary services—particularly imaging—at these sites.

And because capacity at these sites tends to vary significantly by season, day of the week, and even time of day, some organizations are incorporating routine service offerings into their UCCs and retain clinics, including:

  • Annual physician consultations;
  • Chronic disease management, and
  • Weight loss services.
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