A Guide to Selling a Medical Practice in 2025

As the saying goes, “Put your house in order before you start to sell.”

That should be your motto when selling a medical practice if you want to avoid delays, mistakes, or even a sales failure.

Unlike many other businesses, a medical practice is a personal affair—your skills and knowledge are the most valuable assets you sell, and none of these are transferable to the next owner.

This means you need to do your due diligence and get all your personal and professional affairs in order when selling a hospital or health system.

Let’s learn how to do that in this article.

Who Will Buy Your Medical Practice?

The type of buyer you choose (or find) will impact your medical practice’s sale price, deal structure, and how it will operate post-sale. Here are seven of the most common types of buyers:

1. Another physician (new or experienced; this can be your co-owner)
2. Small physician group with the same (or related) medical specialty
3. A mid-sized or large physician group looking to move to a new area
4. A specialty group entering a new market
5. Private equity firms looking to add to their healthcare portfolio
6. Hospitals or healthcare systems
7. Franchised medical providers looking to open a clinic in your area

Who Will Help You Sell Your Medical Practice?

When you’re selling a medical practice, you’ll have to work on legal, financial, and operational aspects. This is when it pays off to have a team with the right skills.

Here are the experts you want to work with when selling:

1. Business Broker

A healthcare business broker specializes in selling medical practices. They help you find the right buyers while maintaining confidentiality, negotiate the best price and terms, and manage due diligence and paperwork.

They’ll also know the experts, like auditors, to turn to if you run into regulatory or compliance issues.

2. Healthcare Attorney

A legal counsel with experience handling medical practice sales will help you protect your interests and prevent legal complications that could delay or jeopardize the sale. They’ll assist with:

• Drafting and reviewing contracts like purchase agreements
• Regulatory compliance (HIPAA, Stark Law, anti-kickback statutes)
• Liability and malpractice concerns
• Closing the sale on your terms

3. Accountant/Financial Advisor

An accountant will help you make sense of the financials, organize all financial records, and make it easier for the buyer to understand your practice’s assets and liabilities.

They’ll also help you assess the tax implications of the sale (and learn how much you will actually keep), propose strategies to reduce tax burdens, and structure payments (lump sum, installment, or earnout agreements) for the best payout.

4. Appraiser

Overpricing your medical practice can push away buyers while underpricing leaves money on the table.

An appraiser helps you find the fair market value of your practice, where neither you nor the buyer leaves anything on the table.

They find this value through the evaluation of your practice’s revenue trends, profitability, patient base, contracts, equipment, real estate, assets, goodwill, and reputation.

5. Healthcare Consultant

A healthcare or physician consultantwill provide guidance to improve the overall appeal of your practice to potential buyers.

They’ll analyze your medical practice to find areas for improvement and make recommendations to increase its value before and during the sales process.

They could review your workflows, billing processes, and patient management systems to identify inefficiencies.

They’ll also help you create a value proposition that could appeal to the buyer you’re looking to sell your practice to.

Do You Need All of These Experts?

No single expert can handle every part of a sale. As soon as you start considering a sale, you need to think about who will help you sell.

There are two factors to consider here:

• Your experience selling a business (which you may not have)
• How much time (or patience) you have to manage the details of a sale while working as a doctor

If you have a lot of experience with both, you may not have to hire anybody except an accountant and an attorney.

But if you don’t—which will be the case with most physicians—you’ll likely need at least two to three professionals. These include:

• Health care attorney
• Accountant
• Broker

You might even need all five types of professionals if your practice is large or complex enough.

Just make sure to find people who understand your goals, can work with you, and can help you get to where you’re going.

Keep the following in mind:

• Not all brokers are the same . Some might only be interested in helping you sell your practice and nothing more. This isn’t in your best interest.
• Look for industry experience . An accountant, broker, or appraiser who understands your industry will be able to help you sell your practice for higher and faster compared to someone who doesn’t.
• Do your research . When you’re looking for an advisor, research their background and previous work before bringing them on board.

Who Else Needs to Be On Board When Selling a Medical Practice?

You also need to involve your co-owners—if you have any—in the process.

If you and two other primary care physicians own equal shares in your practice, you’ll first need to hammer out what each of you will get before you sell.

You’ll also need to inform your employees and any medical students rotating at your practice.

You want to help them find alternative employment or provide them with peace of mind that the ownership change will not affect them.

However, when to bring them in will depend on your sales process.

In some cases, assets like real estate or medical equipment may be owned by a separate company and leased to your practice.

If that’s the case, you’ll also need the real estate entity to be part of the sales process as well.

3 Ways to Sell a Medical Practice

Here are three ways to structure the sale of a medical or surgical practice:

1. Selling the Entire Practice

If your practice is structured as a professional corporation (PC) or a professional limited liability company (PLLC), you can sell it as a whole by transferring its stock or membership interests to the buyer.

In this scenario, the buyer takes over all assets and liabilities, your practice itself continues to exist, and you easily hand off your practice since contracts, licenses, and agreements remain intact.

However, because the buyer assumes all existing debts and legal risks, you may not find many buyers unless your practice’s financials are in great shape.

2. Selling Assets, Not Liabilities

If you don’t want to sell the entire practice, you could sell some or all of its assets while keeping the legal entity (corporation or LLC) under your name. In this case:

• The buyer will pick and choose which assets to acquire, like medical equipment, branding, and patient records
• The liabilities will stay with you, meaning you remain responsible for any outstanding debts

Buyers usually prefer asset sales, meaning this option is often easier to negotiate. However, it may leave you with remaining expenses even after the sale.

3. Merging With Another Practice

If you’re looking to combine forces with another medical group, a merger may be your best option.

In this case, your practice will integrate into the buyer’s practice, and your company will cease to exist. This means all your assets and liabilities become part of the new, combined entity.

While this sounds good on the surface, mergers only work well when two smaller practices want to join forces. This allows all physicians—including the original owner—to remain part of the business.

We suggest reaching out to our Partnership Consulting department if you consider going this route.

Process of Selling a Medical Practice

While every sale is unique, most follow these steps:

1. Assess Practice Value

Before you put your practice on the market, you need to know what it’s worth.

This is when an assessor or a healthcare consultant will come in and analyze your practice for the following aspects:

• Revenue and profitability (historical earnings, billing efficiency, and patient volume)
• Tangible assets (real estate, medical equipment, and office furniture)
• Intangible assets (goodwill, patient relationships, and reputation)

After the valuation process, you’ll understand what a fair purchase price looks like for your practice and how you can make improvements to sell for even more.

2. Organize Your Financials and Legal Documents

Buyers want a clear picture of your practice’s financial health and compliance status before making an offer.

You need to ensure you have your profit and loss statements, tax returns, balance sheets, accounts receivable reports, contracts (vendor agreements, leases, employment contracts), and regulatory compliance documents for the past three to five years on hand.

The cleaner these records look, the easier it will be to sell your practice.

If buyers see inconsistent financials or regulatory gaps, that’ll slow down negotiations—or worse, scare them away.

3. Find the Right Buyer

Not all buyers are equal. Depending on your goals, you may sell to another physician, hospital, or private equity firm.

Each of these buyers will have different priorities, so you need to sit down at the get-go and lay out expectations. This will save you time.

If you’re looking to sell to a private equity firm, they may only be interested in the future revenue and profitability potential of your practice. You’ll need to have documents and a plan of action before you meet in person.

4. Negotiate Terms and Structure the Deal

Once a buyer is interested, negotiations begin.

This is when you’ll settle on a sale structure—asset sale, stock sale, or merger—agree on price, payment terms, and transition period, and address any liabilities.

After you’ve settled on the terms, your healthcare attorney will draft a purchase agreement—a legal contract detailing the terms.

This will include non-compete clauses, malpractice tail coverage, and patient record transfers.

5. Notify Your Staff and Patients

After you’ve finalized the sale and have done the paperwork to push it through, you’ll need to communicate the transition to your employees and patients.

You’ll have to discuss what will happen to your employees and send notices to all your patients so they aren’t caught off guard. You can notify your patients in person, by email, or by paper mail.

You will also decide whether to stay on for a transition period or not. This could help you introduce the new management to staff, your referral networks, and processes, but it’ll depend on your deal.

6. Close the Sale

Once everything is in place, you need to finalize the deal.

This will require you to sign all legal documents, transfer all assets and liabilities (if required), finalize payments (installments, lump sum, or earn-out agreements), and hand over operations.

If you’re staying on temporarily, set down on paper what your role, duration, and responsibilities will be. This way, you avoid any potential miscommunications.

Sell Your Practice Without Waiting for Years With Physicians Thrive

Selling a medical practice is a process, not an event. You have to plan every step carefully and get expert advice from accountants, brokers, and attorneys to protect your interests.

The key to making the process work is to start early, get the right people on board, and double down on what you want.

But that’s where the going gets tricky. While you can start planning early, it’s difficult to find people who can get you where you need to be. That’s where we come in.

At Physicians Thrive, we help physicians set up, buy, and sell practices—so we know the process from every angle. We have the people, the resources, and the expertise to help you move forward without waiting years for the right opportunity.

Want to know how we can help you get deals done quickly and on your terms? Give us a call today!