Physically-based virtual environments (VEs) provide realistic interactions and behaviors for computer-based medical simulations. Limited CPU resources have traditionally forced VEs to be simplified for real-time performance. Multi-core processors greatly increase the computational capacity of computers and are quickly becoming standard. However, developing non-application specific methods to fully utilize all available CPU cores for processing VEs is difficult. The paper describes a pipeline VE architecture designed for multi-core CPU systems. The architecture enables development of VEs that leverage the computational resources of all CPU cores for VE simulation. A VE's workload is dynamically distributed across the available CPU cores. A VE can be developed once and scale efficiently with the number of cores. The described pipeline architecture makes it possible to develop complex physically-based VEs for medical simulations. Initial results for a craniotomy simulator being developed have shown super-linear and near-linear speedups when tested with up to four cores.