SBA Loans for Direct Primary Care: How to Finance and Grow a DPC Practice

Most physicians who leave insurance-based medicine for direct primary care run into the same problem in month one. The model works, but it accumulates slowly, because you sign members one at a time while rent comes due whether you have forty of them or four hundred.

That gap is the real financing question. It has very little to do with the cost of opening the doors. It is about how you cover the months between opening day and the point where membership revenue finally exceeds your fixed costs.

Small Business Administration loans are one of the ways practice owners bridge that gap. They are not a healthcare-specific program and they are certainly not free money, but the repayment terms suit the kind of business a DPC clinic actually is: small, owner-operated, revenue-generating, and slower to reach scale than a retail storefront.

Here is what the programs cover, and what you should work out for yourself before you apply.

What an SBA loan actually is

The SBA does not lend you money directly. It guarantees a portion of a loan issued by a bank, a credit union, or another approved lender. That guarantee reduces the lender's exposure, which is why these loans can carry considerably longer repayment terms than a conventional commercial loan.

You still apply through the lender. The lender still underwrites the application. The SBA's role stays behind the scenes throughout.

To qualify, the SBA requires that a business be an operating business, operate for profit, be located in the U.S., be small under SBA size standards, not be an ineligible business type, and be "creditworthy and demonstrate a reasonable ability to repay the loan." There is one additional condition that surprises people: you have to establish that the credit is not available on reasonable terms from non-government sources.

The three programs worth knowing

7(a) loans. This is the SBA's primary business loan program, with a maximum of $5 million. Proceeds can go toward short and long-term working capital, acquiring or improving real estate and buildings, machinery and equipment, furniture and fixtures, refinancing current business debt, and changes of ownership.

Maturity depends on what you are financing: real estate can run up to 25 years, equipment up to 10, and working capital is generally 10 years or less.

For most new DPC practices, 7(a) is the relevant program, because working capital is usually what the practice genuinely needs.

504 loans. These are limited to fixed assets: purchase or construction of buildings, land, facilities, and machinery with at least 10 years of useful life, plus improvement or modernization of existing facilities. The SBA lists a maximum of $5.5 million. They cannot be used for working capital or inventory.

If you are buying your building, a 504 is worth a conversation with a lender, but if you are covering payroll while your panel fills, it is simply not the appropriate instrument. Microloans. These run up to $50,000, and the SBA notes the average is about $13,000. They can fund working capital, supplies, furniture, fixtures, machinery, and equipment. They cannot be used to pay existing debts or buy real estate.

For a lean solo practice with low overhead, a microloan may cover the whole gap without taking on a larger obligation.

One rule changed in 2026, and it matters if you are stacking

Until recently, a borrower's combined SBA exposure across both programs was capped at $5 million. That changed on July 4, 2026, when the SBA doubled the cumulative limit to $10 million.

Read the wording carefully, because it is easy to misread as a bigger per-loan ceiling. It is not. The individual program maximums did not move. What changed is the total you may carry across both at once. The SBA describes it as qualified borrowers who secure a 7(a) loan first being able to access up to $5 million through 7(a) and up to $5 million through 504, for a combined total of $10 million.

For a solo practice borrowing working capital, this changes nothing. It becomes relevant in one specific situation: you are buying your own building and you also need operating cash to get through the ramp. Before this rule, those two needs competed for the same $5 million of headroom. Now they do not.

Do the membership math before you do anything else

Lenders will ask how you plan to repay, and the honest version of that answer is a membership number rather than a revenue projection.

Work it backwards. Add up your fixed monthly costs, meaning rent, your own draw, any staff, software, labs, and malpractice, then divide that total by your monthly membership fee. The result is roughly how many members you need before the practice pays for itself.

Suppose your fixed costs come to $30,000 a month and you charge $90. That puts break-even at about 334 members. If you open with 60 and add 15 a month, you are looking at roughly 18 months of gap to finance. Those particular numbers are invented for the illustration, but the exercise is not. Your own version of it tells you both how much to borrow and how long the loan needs to carry you.

Two variables move that timeline more than anything else. The first is how efficiently you convert interest into signed members. The second is how many of those members you retain, because a practice adding 15 and losing five every month is really only growing by ten.

What lenders tend to want to see

Expect to bring a business plan, personal and business financial statements, and a repayment projection you can actually defend under questioning. Because most DPC practices are new entities without operating history, your personal credit and your own capital contribution carry considerably more weight than they would for an established business.

The SBA's Lender Match tool connects borrowers with approved lenders, which is a reasonable place to begin if you do not already have an established banking relationship.

One practical note worth planning around: SBA applications take time to process, so build that reality into when you apply rather than when you need the money in hand.

After the loan, growth is the repayment plan

Once the debt is on the books, everything depends on the membership curve. That is where most of the operational work actually sits: following up with people who inquired and never signed, noticing when an existing member has gone quiet, and understanding which referral sources genuinely produce enrollments.

This is the part Health Compiler builds for. Our marketing automation tracks every lead from first contact to enrolled patient and runs the follow-up sequences most practices never get around to sending. Our DPC analytics surface engagement, utilization, and membership trends across your panel, and they connect to the tools you already use, including Elation, Cerbo, Hint, Atlas.md, Spruce, Stripe, and QuickBooks.

A loan buys you time, and what you do with that time is what determines whether the numbers eventually work.

FAQs

Can a new DPC practice get an SBA loan with no operating history?

Startups can be eligible, but the SBA requires a business to be creditworthy and able to show a reasonable ability to repay. Without revenue history, lenders lean harder on personal credit, your equity contribution, and the strength of your projections.

Which SBA program fits a DPC practice best?

It depends on the use. 7(a) covers working capital, equipment, and real estate. 504 is limited to fixed assets and cannot fund working capital. Microloans go up to $50,000 for working capital, supplies, and equipment but cannot be used for real estate or existing debt.

How much can I borrow?

7(a) loans go up to $5 million and microloans up to $50,000. The SBA lists a maximum of $5.5 million for 504 loans. Since July 4, 2026, a borrower's combined exposure across 7(a) and 504 can reach $10 million, up from $5 million. What you are actually approved for depends on the lender's underwriting and your ability to repay.

Can I take a 7(a) and a 504 loan at the same time?

Yes, within the cumulative limit. The SBA raised that limit to $10 million effective July 4, 2026, and describes the structure as qualified borrowers who secure a 7(a) loan first accessing up to $5 million through each program. Individual program maximums were not increased.

Can I use an SBA loan to buy an existing practice?

7(a) proceeds can be used for changes of ownership, complete or partial. The specifics of any acquisition are a conversation for your lender and your attorney.

Does the SBA lend directly?

No. The SBA guarantees a portion of loans made by participating lenders. You apply through the lender.

This article is general information, not financial, legal, or tax advice. Health Compiler is not a lender and is not affiliated with or endorsed by the U.S. Small Business Administration. Loan programs, amounts, and eligibility rules change; verify current terms at sba.gov and speak with a qualified lender, accountant, or attorney before making financing decisions. Information is current as of September 2026.