The market for oncology practices in Nevada is more active than ever. Larger oncology groups and private equity firms are driving a wave of consolidation, creating a significant opportunity for practice owners. If you are considering your future, understanding this landscape is the first step. This guide covers current market trends, crucial Nevada-specific regulations, and how to value your practice to achieve your personal and financial goals. The process involves more than finding a buyer. It requires careful preparation.
Nevada’s Oncology Market: An Overview
If you’ve noticed more consolidation in Nevada’s oncology space, you are right. The market is incredibly active. Right now, about 26% of oncology clinics in the state are backed by private equity. This reflects a national trend where sophisticated buyers are seeking to partner with established, high-quality practices. This level of buyer interest has created a seller’s market for practice owners who are properly prepared. But it also means you are more likely to be negotiating with an experienced corporate buyer, not another local physician.
Key Considerations for Nevada Owners
Selling your practice in Nevada isn’t just a financial transaction. It’s a legal one with state-specific rules you must follow. Overlooking these can derail a deal.
The Corporate Practice of Medicine (CPOM) Rule
Nevada law generally prohibits a non-physician or a standard corporation from owning a medical practice. This is known as the Corporate Practice of Medicine doctrine. So, how are private equity firms and large groups buying practices? They use a specific legal structure.
The MSO Solution
The answer is the “Friendly PC-MSO” model. Your clinical practice (the Professional Corporation or PC) remains owned by a licensed physician. The buyer acquires a new Management Services Organization (MSO) that handles all non-clinical functions like billing, HR, and marketing. The MSO and PC are tied together by a long-term management services agreement. This structure is standard for corporate buyers, but setting it up correctly is a critical part of the deal.
What Market Activity Looks Like
These market trends are not just theoretical. They are happening on the ground in Nevada. For example, in July 2022, The Oncology Institute (TOI), a major national group, acquired the Las Vegas practice of Dr. Nutan Parikh. This transaction shows a pattern. Buyers are looking for well-run, established practices with strong community reputations and a solid patient base. They saw the value in a practice committed to excellent, value-based care. The right buyer is not just looking for assets. They are looking for a platform for future growth, and they are willing to pay for it.
The Practice Sale Process
Many owners think selling is about finding a buyer. In reality, the most critical work happens before your practice is ever presented to anyone. A structured process protects your confidentiality and creates the competition needed to maximize value. The process generally follows a few key phases.
| Stage | What Happens | Why It Matters |
|---|---|---|
| Preparation | We organize your financials and frame your practice’s story. | This phase is where value is created. It answers a buyer’s questions before they ask them. |
| Valuation | We determine a market-based valuation based on real-time data. | An accurate valuation sets realistic expectations and anchors all negotiations. |
| Marketing | We confidentially approach a curated list of qualified buyers. | A competitive process with multiple bidders is the only way to ensure you get the best price and terms. |
| Due Diligence | The chosen buyer verifies all financial, operational, and legal info. | This is where deals often fail. Proper preparation prevents surprises and keeps the deal on track. |
| Closing | Final legal documents are signed, and funds are transferred. | We manage the attorneys and accountants to ensure a smooth transition to your next chapter. |
How Your Practice is Valued
One of the first questions an owner has is, “What is my practice worth?” The answer is more complex than a simple multiple of revenue. Sophisticated buyers look at one primary metric: Adjusted EBITDA. This stands for Earnings Before Interest, Taxes, Depreciation, and Amortization. More importantly, it is “adjusted” to reflect the practice’s true profitability. We find and normalize owner-specific expenses like personal car leases or above-market salaries that a new owner would not incur. For example, a practice with $500,000 in profit might have a true Adjusted EBITDA of $700,000 after these adjustments. That $200,000 difference can add over a million dollars to your final value. This number, multiplied by a market-based factor, determines your practice’s valuation.
Planning for Life After the Sale
The day the deal closes is not the end of the story. It is the beginning of a new chapter for you, your staff, and your legacy. A successful transition is defined by more than just the sale price. It is defined by how well the deal aligns with your long-term goals. We help owners think through these critical points from the very beginning.
- Your Future Role. Do you want to retire immediately, or continue practicing for a few years with less administrative burden? The right partner will accommodate your desired timeline.
- Your Staff’s Security. Protecting your loyal team is often a top priority. We help negotiate terms that ensure your staff are retained and their futures are secure.
- Your Financial Upside. Many deals include an equity rollover, where you retain a minority stake in the new, larger company. This gives you a “second bite of the apple” when the larger group is sold again in the future.
- Your Legacy. You have spent a lifetime building your practice’s reputation. The right partner will be a steward of that legacy, continuing your commitment to excellent patient care in the community.
Thinking about these elements early in the process ensures you find a partner who fits not just your financial needs, but your personal ones as well.
Frequently Asked Questions
What are the current market trends for selling oncology practices in Nevada?
The Nevada oncology market is very active, with about 26% of oncology clinics backed by private equity. Larger oncology groups and private equity firms are driving consolidation, creating a seller’s market for well-prepared owners. Buyers are experienced corporate entities rather than local physicians, seeking established, high-quality practices with strong community reputations.
What is the Corporate Practice of Medicine (CPOM) rule in Nevada, and how does it affect the sale of an oncology practice?
Nevada law generally prohibits non-physicians or standard corporations from owning medical practices, known as the Corporate Practice of Medicine (CPOM) rule. To facilitate sales to private equity or large groups, the “Friendly PC-MSO” model is used where the clinical practice remains owned by a licensed physician (Professional Corporation or PC), while the buyer acquires a Management Services Organization (MSO) that handles non-clinical functions. This legal structure complies with Nevada regulations.
How is an oncology practice valued when selling in Nevada?
The primary metric for valuation is Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization), adjusted to reflect true profitability by normalizing owner-specific expenses. For example, personal expenses like car leases or above-market salaries are removed. The adjusted EBITDA is then multiplied by a market-based factor to determine the practice’s value, often resulting in a higher valuation than simple revenue multiples.
What steps comprise the typical process of selling an oncology practice in Nevada?
The selling process includes several stages: 1) Preparation – organizing financials and framing the practice’s story; 2) Valuation – determining a market-based valuation; 3) Marketing – confidentially approaching qualified buyers to create competition; 4) Due Diligence – buyer verification of all information to prevent surprises; 5) Closing – signing documents and transferring funds, managed by attorneys and accountants to ensure smooth transition.
What should owners consider about their future after selling their oncology practice in Nevada?
Owners should consider: 1) Their future role, such as retiring immediately or practicing with less administrative burden; 2) Securing the future of their staff by negotiating terms to retain them; 3) Financial upside opportunities, including equity rollover to retain a minority stake in the larger company for potential future gains; and 4) Legacy preservation, ensuring the new partner continues the commitment to excellent patient care in the community.