The market for Telehealth and Digital Therapy practices in North Carolina is experiencing significant growth and strong buyer interest. For practice owners, this presents a unique opportunity to realize the value of their hard work. However, a successful sale depends on understanding market trends, valuation drivers, and regulatory details. This guide provides key insights to help you navigate the process, emphasizing how strategic preparation is the foundation for achieving your personal and financial goals.
Curious about what your practice might be worth in today’s market?
A Thriving Market for Digital Health in the Tar Heel State
The telehealth landscape in North Carolina is not just surviving post-pandemic. It is thriving. With a hospital telehealth adoption rate of 93.4%, virtual care is now a core part of healthcare delivery across the state. Both patients and physicians have embraced this model, cementing its role for the long term. This sustained demand creates a compelling environment for practice owners considering a sale.
Several key trends are fueling this growth and attracting buyers:
- Medicaid Expansion: The state’s expanded Medicaid program heavily utilizes telehealth, especially for behavioral health, creating a large and reliable patient base.
- School-Based Health: There is a growing movement to integrate telehealth into schools, opening a new and expanding service channel.
- Rural Access: Digital solutions are seen as a critical tool for reaching underserved populations in rural and Appalachian regions, a priority for many strategic buyers.
What Buyers Scrutinize in a North Carolina Telehealth Practice
While market demand is high, sophisticated buyers look past the top-line numbers. They focus on the operational and regulatory soundness of your practice. For telehealth providers in North Carolina, two areas are particularly important during due diligence.
The Regulatory Maze
Your compliance framework is a cornerstone of your practice’s value. Buyers will look closely at your adherence to state-specific rules. For example, they will verify that your providers are fully licensed in North Carolina and in any other state where your patients are located. They will also audit your technology platform and documentation procedures to ensure they are secure and fully HIPAA-compliant. A clean compliance record signals a low-risk acquisition. An unprepared one can stop a deal in its tracks.
The Payer Puzzle
North Carolina does not have a payment parity law. This means private insurers are not required to reimburse for telehealth at the same rate as in-person visits. Buyers will want to see a detailed breakdown of your payer mix and reimbursement history. Understanding your revenue cycle and demonstrating stable, predictable collections from key payers like Blue Cross NC and Medicaid is critical. It proves your financial model is resilient.
Why Buyers Are Targeting North Carolina Practices Now
Despite the regulatory complexities, the acquisition market for digital therapy and telehealth practices in North Carolina is very active. This is because strategic buyers and private equity groups see a compelling story of profitability and growth. They are not just buying your current patient list. They are investing in a platform for future expansion.
The success of programs like the NC-STeP, which has saved the state over $54 million, proves the economic power of virtual care. Buyers want to replicate that efficiency and impact. They are looking for practices that can help them achieve their strategic goals.
Here019s how a buyer might view your practice019s key attributes:
| What You Have | What a Buyer Sees |
|---|---|
| An established patient base | A scalable foundation for market entry |
| A HIPAA-compliant platform | A low-risk, tech-enabled asset |
| A strong team of therapists | A talented provider network to build upon |
| A foothold in a rural area | A strategic entry point to an underserved market |
Effectively telling this story is key to attracting the right partner and maximizing your valuation.
The Path to a Successful Sale
Many owners believe the sale process begins when they decide to sell. The most successful transitions, however, start one to two years before that. Buyers pay for proven performance, not just potential. Proper preparation is what allows you to sell on your terms. A structured process typically follows a clear path.
- Preparation and Valuation. This is the foundational stage where we help you clean up financials, organize compliance documents, and establish a clear, defensible valuation. It is the most important step for maximizing value.
- Confidential Marketing. We do not just “list” your practice. We create a detailed narrative and identify a curated list of qualified strategic and financial buyers, approaching them confidentially to protect your staff and patient relationships.
- Negotiation. After generating interest, we manage offers to create competitive tension. This phase is about more than just price. It’s about finding the right partner and negotiating terms that protect your legacy.
- Due Diligence. This is where the buyer validates everything. A well-prepared practice sails through this phase. An unprepared one can see the deal get re-priced or fall apart completely.
- Closing. The final stage involves legal documentation and the transition of ownership. Our team manages this complex coordination to ensure a smooth finish.
Understanding Your Practice’s True Value
Determining what your telehealth practice is worth is more than a simple math problem. While a practice generating $150 per visit seems straightforward, buyers value your business based on its sustainable cash flow and future potential. We find most practices are undervalued until their financials are properly presented.
The Core Number: Adjusted EBITDA
The starting point for any valuation is Adjusted Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA). Most importantly, we “adjust” this number. We add back personal expenses run through the business or normalize an owner’s salary to what a fair market replacement would cost. This process alone often reveals significant hidden value and forms the true baseline for what a buyer is willing to pay.
The Multiplier Effect
This Adjusted EBITDA is then multiplied by a number that reflects your practice’s quality and risk. For telehealth, factors like recurring revenue models, high-demand specialties like psychiatry, and a diverse payer mix can lead to higher multiples. A solo-provider practice will have a lower multiple than a multi-provider practice that is not dependent on a single person. Getting this multiple right is where deep market knowledge becomes invaluable.
Planning for Life After the Sale
The moment a deal closes is not the end of the story. It is the beginning of a new chapter for you, your staff, and your practice. Structuring the sale correctly ensures this transition aligns with your personal and financial goals. Thinking through these points ahead of time is critical.
- Your Future Role. Do you want to continue practicing for a few years, or are you ready for a clean exit? Your desired role will heavily influence the type of buyer you partner with and the structure of the deal.
- The Financial Structure. A sale doesn’t always mean 100% cash at closing. Many deals include an “earnout” (additional payments for hitting future performance targets) or an “equity rollover” where you retain a stake in the larger company. This can provide a “second bite of the apple” when the new, larger entity sells again.
- Protecting Your Legacy. For many owners, the biggest concern is what happens to their team and the culture they built. The right partner is one who respects your legacy. We help find buyers whose vision aligns with yours, ensuring a smooth transition for the people who helped you succeed.
The North Carolina telehealth market offers a tremendous opportunity for practice owners. Navigating the path to a successful sale requires careful planning, market knowledge, and strategic execution.
Every practice sale has unique considerations that require personalized guidance.
Frequently Asked Questions
What is driving the growth of Telehealth and Digital Therapy practices in North Carolina?
The growth is driven by factors such as Medicaid expansion, integration of telehealth into schools, and the need to improve rural access in underserved areas. A hospital telehealth adoption rate of 93.4% also indicates strong market acceptance.
What regulatory factors should I be aware of when selling my Telehealth practice in North Carolina?
Compliance with state-specific regulations is crucial. Providers need to be licensed in North Carolina and any state where patients are located. HIPAA-compliant technology and thorough documentation are essential to avoid risks during due diligence.
How does North Carolina’s lack of a payment parity law impact the sale of a Telehealth practice?
Without payment parity, private insurers are not required to reimburse telehealth at the same rate as in-person visits. Buyers will scrutinize your payer mix and reimbursement history to ensure stable, predictable revenue, which affects the valuation.
What preparation steps should I take before selling my Telehealth or Digital Therapy practice?
Start preparation 1-2 years in advance. This includes cleaning up financials, organizing compliance documents, and establishing a defensible valuation. Proper preparation increases buyer confidence and maximizes practice value.
What factors influence the valuation of my Telehealth practice in North Carolina?
Valuation is based on adjusted EBITDA, which normalizes personal expenses and owner salaries, and a multiplier reflecting practice quality and risk. Practices with recurring revenue, diverse payer mixes, and multi-provider teams often receive higher valuations.