What is a MEIP in a healthcare PE deal?

PE buyers do not run practices. They buy the team that does. A MEIP is how they keep that team aligned through the hold period. The pool is set aside at the time of the investment and granted to a small group of executives and physician leaders: in WTW's 2026 survey the median plan started with 15 participants, about 2% of the company's employees, and smaller investments (under $200 million) tended to set aside a larger percentage than big ones. Vesting usually mixes time and performance. Goodwin's private equity deal database shows 62% of middle-market incentive plans blend the two. Time vesting typically runs four or five years in total, either a one-year cliff followed by three or four years of installments or equal installments, usually annual, over four or five years, and performance vesting is usually tied to the sponsor's multiple on invested capital or IRR at exit. Profits interests were the most common vehicle in WTW's survey (50% of respondents), ahead of stock options (30%) and restricted shares or units (28%). Selling physicians who stay with the platform can receive a MEIP grant on top of their rollover equity. The questions to ask: what is the strike price or threshold value, does the MEIP participate pari passu with the PE sponsor, what happens if you are terminated, and what is the vesting acceleration on a change of control. These questions are boring until they are not, which is usually at the exit, when getting the answers wrong costs real money.