How long does it take to sell a medical practice?
A medical practice sale timeline is the elapsed time from deciding to sell through to cash in the seller's account, including prep, marketing, LOI, diligence, definitive agreements, and closing conditions.
Quick answer
Selling a medical practice to a PE buyer typically takes 6 to 12 months from engagement to close, with 2 to 3 months of prep, 1 to 2 months of marketing, 2 to 3 months of diligence and negotiation, and 1 to 2 months for definitive documents and closing.
The detail
A typical PE-backed healthcare practice sale breaks into five phases. Phase 1 (prep, 2 to 3 months): engage banker or advisor, build financial package, commission sell-side QoE, clean up legal and HR files, normalize owner compensation for pitch deck. Phase 2 (marketing, 1 to 2 months): target buyer list, teasers, NDAs, management meetings, initial indications of interest. Phase 3 (LOI and diligence, 2 to 3 months): select preferred bidder, negotiate LOI, enter exclusivity, buyer-side QoE, legal diligence, clinical and regulatory diligence. Phase 4 (definitive agreements, 1 to 2 months): purchase agreement, employment agreements, transition services, real estate, regulatory filings. Phase 5 (closing, 2 to 6 weeks): consents, licenses, payer re-credentialing prep, funding, closing mechanics. Timelines compress for smaller add-on deals (often 4 to 6 months total) and extend for complex multi-location platforms or deals with regulatory complexity (up to 18 months). Sellers who start without prep often add 3 to 6 months fixing issues buyers find in QoE.
Average time from engagement to close for healthcare practice sales is 6 to 12 months; larger platform deals take 12 to 18 months.
Source: Pitchbook Healthcare Services
About 15 to 30 percent of signed LOIs in healthcare M&A do not close, most often due to issues surfaced in QoE or legal diligence.
Source: Bain & Company Healthcare PE
What this means for clinic owners
From Sorso
The most common avoidable delay is poor financial hygiene — messy books, uncategorized owner expenses, and unclear related-party rent arrangements. Practices that spend 12 to 24 months cleaning up financials before going to market typically close faster and at higher multiples than practices that try to sell unprepared.
Related questions
What does a medical practice valuation cost?
A formal medical practice valuation typically costs $5,000 to $25,000 depending on practice size, valuation purpose, and whether a calculation engagement or full opinion is required.
How do PE firms value medical practices?
Private equity firms value medical practices primarily on a multiple of trailing twelve-month adjusted EBITDA, typically 5x to 12x, with the multiple driven by scale, growth, payer mix, and provider retention.
What is a quality of earnings report?
A quality of earnings (QoE) report is a buyer-commissioned financial due diligence analysis that normalizes EBITDA, tests the reliability of revenue and expenses, and identifies risks that affect purchase price, typically costing $50K to $150K for a healthcare practice.
What is an LOI in healthcare M&A?
A letter of intent (LOI) in healthcare M&A is a non-binding agreement that sets the proposed purchase price, structure, exclusivity period, and diligence timeline before a buyer commits the resources to close a deal.
Founder of Sorso. 19 years in corporate finance. Managed a $450M loan portfolio before building a fractional CFO firm exclusively for healthcare clinics.
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