Guide to Selling a Speech & Occupational Therapy Integration Practice in Louisiana

Selling your Speech & Occupational Therapy practice is one of the most significant financial decisions you will make. In Louisiana, the market presents distinct opportunities and challenges, from navigating state regulations to understanding how large healthcare networks influence acquisitions. This guide provides a clear overview of the market, key considerations for a successful sale, and how to accurately determine your practice’s value. We are here to help you navigate this complex, yet rewarding, journey.

Market Overview

The market for therapy practices in Louisiana is shaped by a unique combination of regulatory oversight and a complex payment environment. For practice owners, understanding this landscape is the first step toward a successful sale. The presence of large healthcare systems and state-specific Medicaid programs creates both challenges and significant opportunities for well-positioned practices.

The Regulatory Environment

Your practice operates under the rules of the Louisiana Board of Examiners for Speech-Language Pathology and Audiology (LBESPA) and the Louisiana Occupational Therapy Association (LOTA). These bodies set the standards for care and licensing. It is important to know that state regulations strictly prohibit the sale or bartering of a professional license, a key factor that shapes how practice transitions must be structured.

The Payer Landscape

A significant portion of therapy services in Louisiana is influenced by Medicaid programs like Healthy Louisiana, which relies on Managed Care Organizations (MCOs). Your practice’s contracts and standing with these MCOs, as well as with large Integrated Delivery Networks (IDNs), heavily influence its attractiveness to buyers. A strong, diversified payer mix is a key asset in any sale negotiation.

Key Considerations

Beyond the market dynamics, selling your practice involves deeply personal and critical financial decisions. Your primary goal is likely to ensure your clients continue to receive excellent care and that your dedicated staff is treated well. Legally and ethically, clients cannot be “sold.” The process involves carefully transitioning goodwill and ensuring continuity of care, which requires thoughtful planning. At the same time, the financial structure of your sale is critical. How the deal is structured as an asset sale versus an entity sale, for example, has massive implications for your final, after-tax proceeds. Getting this wrong can cost you a significant portion of your life’s work.

Market Activity

While specific private practice sales are often confidential, the broader M&A trends in Louisiana are clear. We are seeing larger, national therapy providers and private equity groups show significant interest in the state, demonstrated by recent acquisitions. For instance, the expansion of major players like FOX Rehabilitation into Louisiana signals that the market is active.

This trend has three direct implications for you as a practice owner:

1. Increased Buyer Interest: There is a growing pool of well-capitalized buyers looking for quality practices in Louisiana. This is good news for sellers.
2. Higher Valuation Potential: When multiple buyers compete for a practice, it naturally drives up the potential valuation. The right process can create a competitive auction for your business.
3. The Need for Preparation: These larger buyers are sophisticated. They conduct deep financial and operational due diligence. Coming to the table unprepared can lead to a lower offer or a failed deal.

Sale Process

Selling a medical practice is not a simple transaction; it is a multi-stage process that requires careful management from start to finish. It begins long before a buyer is ever contacted, with deep preparation of your financial and operational documents. From there, we identify and confidentially approach a curated list of qualified buyers. This creates a competitive environment designed to yield the best offers. Once an offer is accepted, the most critical phase begins: due diligence. This is an intense review where the buyer verifies every aspect of your practice. Many deals fall apart here due to surprises or poor preparation. A smooth closing only happens when the foundation has been properly set.

Valuation

One of the first questions any owner asks is, “What is my practice worth?” While you may hear simple rules of thumb, like a multiple of annual revenue, these are often misleading and can dramatically undervalue your business. Sophisticated buyers don’t value your practice based on revenue. They value it based on its profitability and cash flow, a metric called Adjusted EBITDA.

Adjusted EBITDA starts with your net income and adds back interest, taxes, depreciation, and amortization. More importantly, it adds back owner-specific expenses (like a personal car lease) and normalizes your salary to a fair market rate. This reveals the true cash flow a new owner could expect.

Here is a simplified example:

This Adjusted EBITDA figure, not your net income, is what a buyer will apply a multiple to. A comprehensive valuation is the only way to uncover this true number and defend it during negotiations.

Post-Sale Considerations

The day your sale closes is not the end of the story. It is the beginning of a new chapter for you, your staff, and your patients. Planning for this transition is just as important as negotiating the sale price. What will your role be, if any? How can you ensure your professional legacy is protected? Modern deal structures often include ways for owners to share in the future success of the practice. This might involve an “earnout,” where you receive additional payments as the practice hits performance targets, or an “equity rollover,” where you retain a minority stake in the new, larger company. This can provide a “second bite of the apple,” often leading to another significant payday down the road.