If you own an Orthopedic or Musculoskeletal (MSK) practice in Denver, you are operating in a uniquely active market. Demand for Ortho & MSK services in Denver is significantly outpacing the nation, attracting strong interest from both strategic buyers and private equity groups. This guide provides a clear overview of the market, the selling process, and how to prepare for a successful transaction. Understanding your options is the first step.
The Denver Ortho & MSK Market Landscape
The market for Ortho & MSK practices in Denver is not just growing; it is dynamic and attracting significant national attention. Two factors are primarily responsible for this climate.
Exceptional Patient Demand
Local demand is a key driver of value. Recent data shows that patient search volume for orthopedic providers in the Denver area is 62% higher than the national average. This robust, built-in patient base makes established practices incredibly attractive to buyers looking for immediate, stable cash flow and growth potential. It confirms that your practice is located in a thriving healthcare ecosystem.
A Magnet for Sophisticated Buyers
Denver is on the radar for private equity (PE) firms and large health systems. They are drawn to the profitability of orthopedics, particularly practices with lucrative ancillary services like physical therapy, imaging, or ambulatory surgery centers (ASCs). These buyers see Denver as a key hub for building regional platforms, as evidenced by recent acquisitions from groups like United Musculoskeletal Partners. This investor appetite creates a competitive environment that can drive premium valuations for well-prepared practices.
Key Considerations Before a Sale
Beyond the market conditions, a successful sale begins with internal clarity. First, consider your personal and financial goals. Are you planning for retirement, seeking a strategic partner to handle administrative burdens, or looking to de-risk your investment? Your objective will shape the ideal buyer and deal structure.
From a buyers perspective, your practice is a story told through data. They will look past the surface to analyze the core health of your operations. They want to see consistent cash flow, a strong and diverse referral base, a stable team of providers and staff, and clean, transparent financial records. A disorganized practice with messy books or high reliance on a single referral source can create doubt and lower a potential offer. Preparing your practice for sale is about making sure your story is clear, compelling, and ready for scrutiny.
What’s Happening on the Ground in Colorado
The interest in Denver’s Ortho & MSK market is not theoretical. We are seeing significant transactions that highlight the current opportunities for practice owners.
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The Rise of Private Equity Platforms. National groups are actively buying and merging practices to create large, regional “super-groups.” The recent expansion of United Musculoskeletal Partners (UMP) into the Denver market is a prime example of this trend in action. These buyers have a mandate to grow and are actively looking for their next partner.
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Strategic Health System Consolidation. Local and regional health systems are also looking to expand their orthopedic service lines. The ongoing talks between Gunnison Valley Health and Vail-Summit Orthopaedics show a desire to secure market share and build integrated care networks across Colorado.
These trends show that buyers are not just looking for a single practice; they are looking for strategic assets to build a larger vision. Positioning your practice to fit into that vision is key.
Navigating the Path to a Sale
Selling your practice is a structured process that typically takes six to twelve months from start to finish. It is not a side project; it is a significant undertaking that requires a dedicated team, including your accountant, a lawyer, and an M&A advisor who can quarterback the entire effort.
The journey begins with preparation and a professional valuation. This sets the foundation for your asking price and strategy. Next, your advisor will confidentially market the practice to a curated list of qualified buyers, managing inquiries and protecting your identity. Once interest is established, you will move into negotiations on price and terms, followed by an intensive due diligence phase where the buyer verifies every aspect of your business. A well-managed process ensures you can continue focusing on patient care while your advisory team handles the complexities of the transaction.
How Buyers Determine Your Practice’s Value
One of the most common questions we hear is, “What is my practice worth?” While “rules of thumb” based on revenue exist, sophisticated buyers use a more precise method. They calculate value based on a multiple of your practice’s Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization). This figure represents your true, sustainable cash flow after normalizing for owner-specific expenses.
That Adjusted EBITDA is then multiplied by a number (the “multiple”) that reflects the quality and risk of those earnings. A higher multiple means a higher valuation. Here are some of the key factors that influence your multiple.
| Factor | Impact on Multiple |
|---|---|
| Provider Model | A practice with multiple associate providers is less risky and gets a higher multiple than a solo practice. |
| Ancillary Services | In-house PT, imaging, or an ASC creates diverse revenue streams and commands a higher multiple. |
| Referral Sources | A broad, diverse base of referrals is more stable and receives a higher multiple than reliance on one source. |
| Payer Mix | A healthy mix of commercial payers is often valued at a higher multiple than a heavy reliance on Medicare. |
A professional valuation does more than find a number. It crafts a narrative that justifies the highest possible multiple for your practice.
Securing Your Legacy After the Sale
The transaction is not truly complete when the papers are signed. A successful exit is also defined by what happens in the months and years that follow. Thinking about this early is critical for a smooth transition for everyone involved.
Your two most valuable assets are your patients and your staff. A well-designed communication plan is needed to ensure continuity of care and retain key employees, protecting the practice’s value for the new owner and preserving the community standing you worked so hard to build. Furthermore, the structure of your sale has massive tax implications. Proactive tax planning with an expert can significantly impact your final net proceeds. Finally, consider your own future. Do you want to continue practicing for a few years, retire immediately, or pursue another venture? A well-planned transition protects your financial future and your legacy.
Frequently Asked Questions
Why is the Denver Ortho & MSK market attracting significant buyer interest?
The Denver Ortho & MSK market attracts significant buyer interest due to its exceptionally high patient demand—62% higher than the national average—and because it is a strategic hub for private equity firms and large health systems aiming to build regional platforms. This creates a competitive environment that can drive premium valuations for well-prepared practices.
What should I consider before selling my Ortho & MSK practice in Denver?
Before selling, consider your personal and financial goals, such as retirement plans, desire for a strategic partner, or risk reduction. Buyers analyze your practice’s financial health, patient base diversity, stable staff, and clear financial records. Ensuring your practice is well-organized and has a compelling story is crucial for a successful sale.
How do buyers value an Ortho & MSK practice in Denver?
Buyers typically value an Ortho & MSK practice based on a multiple of its Adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization). Factors influencing the valuation multiple include having multiple providers (higher multiple), ancillary services like physical therapy or imaging, diverse referral sources, and a healthy commercial payer mix.
What is the typical timeline and process for selling an Ortho & MSK practice in Denver?
Selling a practice usually takes 6 to 12 months. The process includes preparation and professional valuation, confidential marketing to qualified buyers, negotiating price and terms, due diligence by the buyer, and closing. Having a dedicated team including an accountant, lawyer, and M&A advisor is essential to manage the complexities while maintaining patient care.
How can I secure my legacy and ensure a smooth transition after selling my practice?
To secure your legacy, develop a communication plan to maintain patient care continuity and retain key staff members. Plan for tax implications of the sale with expert advice. Also, decide your post-sale plans—whether to continue practicing, retire, or pursue other ventures—to ensure a smooth transition that protects your financial future and the community reputation of your practice.
