For owners of oncology practices in Jacksonville, the market is presenting a unique set of challenges and opportunities. The healthcare landscape is shifting due to ongoing consolidation, creating a window where a strategic sale can secure your financial future and legacy. Understanding the current trends, buyer appetites, and your practice’s true value is the first step. This guide provides a direct look at what you need to know about selling your oncology practice in today’s active market.
Market Overview: The Jacksonville Landscape
The market for oncology practices in Florida is one of the most active in the country. If you’re an owner in the Jacksonville area, these are the key dynamics you should be watching.
The Consolidation Wave
Florida is at the forefront of medical practice consolidation. Between 2018 and 2020 alone, the state saw a 20.8% rise in the acquisition of community oncology practices. Independent clinics are increasingly joining larger hospital systems or private equity platforms to gain scale and resources. This trend means that standing still is a strategic decision in itself. For many, it presents a clear signal that now is the time to explore a sale or partnership.
Squeezed Margins, New Opportunities
At the same time, many community oncology practices are facing declining operating margins. Rising costs and complex reimbursement landscapes make it harder to remain profitable while independent. However, this pressure is precisely what makes well-run practices so attractive to buyers. Acquirers are looking for established practices that can benefit from their larger operational backbone, creating a powerful opportunity for owners ready for a transition.
Key Considerations for Oncology Practice Owners
Selling an oncology practice is not like selling any other business. Your practice is built on deep patient relationships, trusted referral networks, and a highly specialized team. These are not just operational details; they are valuable assets that sophisticated buyers recognize. A successful sale requires a plan that honors patient care continuity and protects the clinical team that helped you build your reputation.
Your legacy is tied to the well-being of your patients and staff. The right transaction structure can ensure they are protected during the transition to new ownership. This is often a top concern for physician owners, and it’s something that should be addressed from the very beginning of the sale process. Planning for this transition protects your life’s work.
Market Activity: Who Is Buying in Florida?
The growth projected for the US oncology market has attracted a diverse group of buyers. In Florida, private equity (PE) firms have become particularly active, with nearly 20% of all PE-backed oncology clinics nationwide located right here in the state. This intense interest creates a competitive environment for sellers. However, not all buyers are the same. Each type has different goals, which will shape the deal and your future role.
Understanding your potential buyers is the first step toward finding the right fit for your personal and financial goals. Here is a simplified look at the most common buyer types.
| Buyer Type | Primary Goal | What It Means for You |
|---|---|---|
| Hospital or Health System | Expand referral network and service lines. | Often a full sale. Integration into a larger, more bureaucratic system. |
| Private Equity Group | Grow EBITDA, build a regional platform, and sell it in 3-7 years. | Partnership model. You retain equity (“rollover”) and clinical autonomy, with a potential second payout later. |
| Strategic Acquirer | Enter the Jacksonville market or expand their existing oncology footprint. | Can be a full sale or partnership. Focus is on strategic fit and market share. |
The Sale Process: A Step-by-Step Overview
Thinking about selling your practice can feel overwhelming. We find it helps to break it down into a clear, manageable journey. The process generally moves through four key phases: Preparation, Marketing, Due Diligence, and Closing. It starts with getting your financials and operations in order to present the strongest case to buyers. Then, a confidential marketing process identifies the best-fit partners without disrupting your practice.
The most critical stage is often due diligence. This is where the buyer inspects every aspect of your business, from financial records to compliance protocols. Many deals encounter unexpected problems here. Proper preparation, with clean books and clear documentation, can prevent these issues and ensure a smooth path to closing the deal on your terms.
Valuation: What Is Your Oncology Practice Really Worth?
Many practice owners mistakenly believe their practice’s value is simply a percentage of revenue or based on net income. The reality is that sophisticated buyers use a more detailed approach centered on a key metric: Adjusted EBITDA.
Beyond the Bottom Line: Adjusted EBITDA
EBITDA stands for Earnings Before Interest, Taxes, Depreciation, and Amortization. It is a measure of a practices core profitability. We then “adjust” this number by adding back owner-specific or one-time expenses, such as an above-market salary, personal vehicle leases, or other perks. This process reveals the practice’s true cash flow, which is what buyers are really purchasing. We often find this simple step can significantly increase a practice’s perceived value.
What Drives Your Multiple?
Once Adjusted EBITDA is calculated, it is multiplied by a number (the “multiple”) to determine your practice’s total value. That multiple is not random. It is influenced by several factors.
1. Scale: Practices with higher EBITDA are seen as less risky and command higher multiples.
2. Provider Model: Practices that are not totally dependent on the owner-physician are more valuable.
3. Growth Trajectory: A history of consistent growth is very attractive to buyers.
4. Payer Mix: A stable mix of in-network insurance contracts reduces perceived risk.
Post-Sale Considerations: Structuring Your Next Chapter
The transaction is not just an end point. It is the beginning of your next chapter. How the deal is structured has major implications for your future wealth, clinical role, and personal goals. One of the most common concerns we hear from physicians is the fear of losing control. Modern deal structures are designed to address this.
With a private equity partner, for example, it is common for the seller to “roll over” a portion of their equity into the new, larger company. This allows you to take significant cash off the table now while retaining ownership and participating in the future growth of the platform. This creates the potential for a “second bite at the apple” when the larger platform is sold again years later. Your exit should be designed around your specific objectives, whether that is maximizing cash at close, maintaining clinical autonomy, or creating long-term wealth.
Frequently Asked Questions
What are the current market trends affecting the sale of oncology practices in Jacksonville, FL?
The oncology practice market in Jacksonville is experiencing significant consolidation, with a 20.8% rise in acquisitions in Florida from 2018 to 2020. Independent practices are increasingly integrating with larger hospital systems or private equity firms to gain scale and resources. This trend pressures independent practices but creates opportunities for strategic sales.
Who are the typical buyers of oncology practices in Jacksonville, and what are their goals?
There are three primary buyer types: 1) Hospitals or health systems aiming to expand their service lines, often through full acquisitions; 2) Private equity groups that seek to grow EBITDA and build regional platforms, offering a partnership model with potential equity rollover and future payouts; 3) Strategic acquirers looking to enter or expand in Jacksonville, which can involve full sales or partnerships focused on market share.
How is the value of an oncology practice in Jacksonville typically determined?
Practice value is primarily based on Adjusted EBITDA—earnings before interest, taxes, depreciation, and amortization, adjusted for owner-specific or one-time expenses. This adjusted figure reflects the true cash flow and is multiplied by a factor known as the multiple, influenced by factors such as practice size, provider model, growth history, and payer mix.
What key factors should oncology practice owners consider when planning to sell their practice?
Owners should consider the protection of patient care continuity and clinical teams during transitions, the type of buyer that aligns with their goals, and how the deal structure will affect their future wealth and role. Proper preparation involving clean financials and compliance documentation is crucial to ensure a smooth sale process and maximize value.
What post-sale options do oncology practice sellers have regarding their ongoing involvement and financial participation?
Sellers often have options like ‘rolling over’ equity with private equity partners, allowing them to retain ownership and clinical autonomy while receiving immediate cash payouts. This structure also offers potential future earnings from the larger platform‚Äôs growth, enabling sellers to design an exit strategy that balances cash, control, and long-term wealth.