Introduction

Private equity has become one of the most powerful forces reshaping the healthcare landscape. Medical and dental practice owners are seeing unprecedented acquisition activity, often at valuations that were unthinkable a decade ago. For many practitioners, these offers represent both opportunity and uncertainty.

At Lindberg & Ripple, we assist healthcare professionals in evaluating, structuring, and optimizing these transactions so that the outcome aligns with both personal and professional goals. Selling a practice is not only a business decision; it is also a significant wealth event that demands careful planning to avoid unnecessary tax exposure and to preserve long-term financial independence.

The Rise of Private Equity in Healthcare

Private equity firms have identified healthcare as a stable, scalable industry with predictable revenue and strong margins. Consolidation has accelerated in fields such as dentistry, dermatology, ophthalmology, orthopedics, and primary care.

For many practitioners, joining a larger platform can provide access to improved infrastructure, administrative support, and capital for growth. However, it can also mean relinquishing control and facing new performance metrics or non-compete agreements.

Key Considerations Before Selling

1. Valuation and Deal Structure

Understanding how your practice is valued is critical. Private equity buyers typically base offers on EBITDA (earnings before interest, taxes, depreciation, and amortization) multiples, adjusted for normalized expenses.

• Analyze whether your current structure maximizes EBITDA.
  
• Determine how much of the purchase price will be paid upfront versus through earn-outs or rollover equity.
  
• Recognize that not all valuations are equal; structure often matters more than headline numbers.
  

A well-advised seller can often achieve 10 to 20 percent higher after-tax value through strategic deal structuring.

2. Tax Mitigation Strategies

A sale can trigger significant capital gains and ordinary income taxes. Planning well in advance allows you to reduce this burden.

Key techniques include:

• Entity review: Ensure your practice structure (S-Corp, LLC, or partnership) is tax-efficient for a sale.
  
• Qualified Small Business Stock (QSBS) considerations where applicable.
  
• Charitable planning: Use donor-advised funds or charitable remainder trusts to offset taxable gains.
  
• Trust strategies: Gifting a portion of the practice before sale to irrevocable trusts to move appreciation outside the taxable estate.
  

Early integration of these strategies can result in substantial long-term savings.

3. Succession and Lifestyle Readiness

A sale often changes more than ownership; it changes identity and lifestyle. Owners must assess:

• Whether they are emotionally and financially ready to transition.
  
• How post-sale compensation, retention, or equity arrangements will align with long-term goals.
  
• How liquidity will be managed to sustain their desired lifestyle, philanthropy, or future ventures.
  

At Lindberg & Ripple, we help practice owners integrate these personal goals into their broader wealth and estate plan.

How Advisory Partnership Enhances Outcomes

Private equity transactions involve complex negotiations, legal reviews, and financial modeling. Coordinating across CPAs, attorneys, and financial advisors ensures the sale is not only successful but also optimized for your specific objectives.

Our advisory approach provides:

• Deal structure evaluation: Aligning with your risk and cash flow needs.
  
• Tax and estate integration: Coordinating strategies before and after the transaction.
  
• Liquidity and investment planning: Transforming business equity into a sustainable portfolio.
  

The result is not merely a completed sale but a foundation for enduring financial freedom.

Our Perspective

Lindberg & Ripple has advised clients across industries for more than four decades. Our independence allows us to represent practice owners with objectivity, ensuring that each decision serves the client’s best interest rather than that of the buyer.

For healthcare professionals, the rise of private equity represents both risk and reward. With informed preparation, the sale of a medical or dental practice can become not just a business milestone, but a legacy-defining moment.

Contact us to schedule a confidential consultation.

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