The market for selling an Orthopedic and Musculoskeletal practice in Tampa is presenting unique opportunities for owners like you. Florida’s growing population and high interest from buyers create a dynamic market where well-positioned practices are in demand. This guide provides a look into the current landscape, key buyer trends, and the valuation process, helping you understand the path to a successful sale.
A Strong Market for Ortho & MSK Sellers
If you are an Ortho & MSK practice owner in Tampa, you are in a strong position. The entire U.S. orthopedics market is growing, expected to expand from over $57 billion in 2023 to nearly $75 billion by 2028. This national trend puts a spotlight on practices everywhere.
Florida, and Tampa specifically, is a hotspot within this national market. The state’s powerful demographic trends, particularly its growing senior population, create a reliable and increasing demand for musculoskeletal care. This means buyers, from large health systems to private equity groups, are actively looking for established, high-quality practices in the area. They see Tampa not just as a good market today, but as a great market for future growth.
Key Considerations for Your Practice Sale
Selling your practice is more than a financial transaction. It involves your legacy, your team, and your patients. Thinking through these key areas early on is the first step to a smooth and successful transition.
Your Timing and Goals
Are you looking to retire completely, or do you want to stay on and focus solely on clinical work? Your personal and professional goals will shape the entire deal structure. Many owners think they should wait until they are ready to exit, but the best time to start planning is often 2-3 years before you want to sell. This gives you time to prepare the practice to get the highest value.
Your Staff and Legacy
You have likely spent years building a talented team and a reputation for excellent patient care. A major concern for sellers is ensuring staff are taken care of and that patient care continues without disruption. The right buyer will share these values. We help you find partners who are committed to protecting your legacy and investing in your team’s future.
Your Confidentiality
Exploring a sale should not disrupt your day-to-day operations or cause undue stress for your employees and patients. Maintaining strict confidentiality throughout the marketing and negotiation process is critical. A structured process managed by an advisory firm ensures that sensitive information is shared only with qualified, vetted buyers under strict non-disclosure agreements.
What’s Happening in the Tampa M&A Market
The activity in the healthcare M&A space is a strong indicator of opportunity. In the third quarter of 2024 alone, there were 110 reported transactions in physician practice management. This shows a continued, healthy appetite for practices like yours.
Two main types of buyers are driving this activity in Florida. You have large, strategic healthcare companies, like USPI, partnering with major local groups like the Florida Orthopaedic Institute. They are looking to expand their networks and invest in outpatient facilities. At the same time, private equity firms are actively acquiring Ortho & MSK practices to build regional and national platforms. This competition between different buyer types can create a very favorable environment for a seller who runs a structured, competitive sale process.
Understanding the Sale Process
Selling a medical practice is a structured journey, not a single event. While every sale is unique, the pathway generally follows four main stages. We manage this entire process so you can stay focused on running your practice.
- Valuation and Preparation. It all starts with understanding what your practice is truly worth. This involves more than looking at revenue; it’s about calculating your true profitability (Adjusted EBITDA) and preparing your financial and operational data so buyers can clearly see the value.
- Confidential Marketing. Your practice is never publicly listed. Instead, we create a compelling story around your practice’s strengths and confidentially present the opportunity to a curated list of qualified, pre-vetted buyers from our proprietary database.
- Negotiation and Offers. With interest from multiple parties, we create a competitive dynamic to drive up the value and improve the terms of the deal. We help you compare offers not just on price, but also on structure, culture, and fit for your long-term goals.
- Due Diligence and Closing. This is where the buyer verifies all the information about your practice. It can be an intense period, but with proper preparation, it goes smoothly. We manage the flow of information and work with legal teams to handle the final contracts, leading to a successful closing.
How Your Ortho & MSK Practice is Valued
One of the first questions every owner asks is, “What is my practice worth?” The answer is based on a structured financial analysis, not a simple rule of thumb. Sophisticated buyers look at two key components to determine value.
Finding Your True Profit: Adjusted EBITDA
Buyers value your practice based on its cash flow, or what we call Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization). This number is different from the profit you see on your tax return. We calculate it by taking your stated profit and adding back owner-specific expenses like an above-market salary, personal car leases, or other one-time costs. This process reveals the true, underlying profitability of your business, which is often much higher than owners realize.
Applying the Right Multiple
Once we establish your Adjusted EBITDA, we apply a valuation multiple to arrive at your practice’s Enterprise Value. This multiple is not a fixed number. It changes based on several factors:
* Scale: Practices with higher EBITDA generally receive higher multiples.
* Provider Mix: A practice less dependent on a single owner is seen as less risky and gets a higher multiple.
* Growth: A track record of consistent growth is very attractive to buyers.
* Ancillary Services: In-house services like physical therapy or imaging can significantly increase value.
For an established Ortho & MSK practice, multiples can range from 5.5x to over 7.5x of Adjusted EBITDA, depending on these and other factors. Our job is to build the story that justifies the highest possible multiple for your specific practice.
Planning for Life After the Sale
The moment your deal closes is a major milestone, but it is not the end of the journey. Planning for what comes next is just as important as negotiating the sale itself. A well-structured deal considers your life after the transaction.
Thinking about these areas ahead of time ensures the deal structure aligns with your personal and financial goals. For example, some sellers choose to “roll over” a portion of their equity into the new, larger company. This allows them to take cash off the table now while also participating in the future growth of the platform, offering a potential second major payday down the road.
| Area of Focus | Key Question to Consider |
|---|---|
| Tax Strategy | How can we structure the sale to legally minimize my tax burden and maximize my net proceeds? |
| Your Future Role | Do I want to retire immediately, or do I want a new role with less administrative burden? |
| Wealth Management | What is my plan for managing the proceeds from the sale to support my family’s future? |
| Legacy & Transition | How will the transition be managed to ensure my professional legacy is preserved? |
Frequently Asked Questions
What is the current market outlook for selling an Ortho & MSK practice in Tampa, FL?
The market in Tampa is very strong due to Florida’s growing population and high buyer interest. Tampa is seen as a hotspot for orthopedic and musculoskeletal care because of its aging population and robust demand, attracting large health systems and private equity firms looking to invest.
How should I prepare my Ortho & MSK practice for sale?
It is recommended to start planning 2-3 years before your intended sale to prepare the practice for maximum value. This includes understanding your true profitability (Adjusted EBITDA), organizing financial and operational data, and ensuring your team and patient care legacy are well protected.
Who are the typical buyers for Ortho & MSK practices in Tampa?
Buyers in Tampa include large strategic healthcare companies partnering with local groups, as well as private equity firms looking to build regional and national platforms. This creates competitive bidding which benefits sellers with better offers and terms.
How is the valuation of an Ortho & MSK practice determined?
Valuation is based on Adjusted EBITDA, which is the practice’s true cash flow after adding back owner-specific expenses. A multiple (ranging from 5.5x to over 7.5x) is then applied, influenced by factors like practice scale, provider mix, growth history, and ancillary services offered.
What considerations should I keep in mind for life after selling my practice?
Post-sale planning is important and might include tax strategies to minimize liabilities, deciding on your future role (retiring or continuing with less responsibility), wealth management for your proceeds, and ensuring a smooth legacy transition for your team and patients.