Selling your integrated Speech and Occupational Therapy practice in New Mexico presents a unique opportunity. Your combined service model is highly attractive in today’s healthcare market. A successful sale, however, depends on understanding your practice’s true value, navigating state-specific regulations, and preparing for the process well in advance. This guide provides a clear path forward, helping you turn your hard work into a rewarding legacy.
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Market Overview
The market for healthcare practices in New Mexico is active. Buyers are looking for established and profitable operations with strong patient retention. Your integrated Speech and Occupational Therapy practice fits this description well. This model, which offers a continuum of care, is efficient for patients and attractive to buyers seeking a strong competitive advantage.
A prime location and a full book of business are significant assets. In a state with diverse patient needs, a practice like yours that is already operationally sound offers a turnkey solution. This makes it a desirable target for both individual buyers and larger healthcare groups looking to expand their footprint in the region. The key is to present your practice in a way that highlights this built-in value.
Key Considerations for New Mexico Owners
Before you begin the sale process, it’s important to get a few state-specific items in order. Navigating these details properly can make the difference between a smooth transaction and a frustrating delay. Here is what you should focus on:
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State Licensure Compliance. Ensure every therapist on your staff is fully licensed with the New Mexico Regulation and Licensing Department (RLD). This includes being current on continuing education requirements and having passed the state’s jurisprudence exam. Buyers will verify this during due diligence.
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Staffing Structure. New Mexico does not currently license Speech-Language Pathology Assistants (SLPAs). If your staffing model relies on roles that border this function, you must clearly define their duties to align with state law. This is a point of concern for knowledgeable buyers.
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Integrated Service Story. Your greatest strength is the integration of speech and occupational therapy. You need to clearly articulate how this benefits patients and creates a sustainable business model. This narrative is a core part of your practice’s value.
Every practice sale has unique considerations that require personalized guidance.
Market Activity
We are seeing strong interest from buyers for therapy practices nationwide, and New Mexico is no exception. Strategic acquirers and private equity groups are actively searching for well-run, profitable practices to serve as platforms for growth. They are not just buying a job. They are buying a business with a proven track record and future potential.
Valuations reflect this interest. While some brokers use simple revenue rules, sophisticated buyers value your practice based on a multiple of its Adjusted EBITDA, or true cash flow. For practices with over $1 million in EBITDA, we often see multiples in the 5.5x to 7.5x range, and sometimes higher. This is because buyers pay for stability, scale, and a clear growth story, all of which an integrated practice can demonstrate.
The Sale Process
Selling a medical practice is a structured process, not a single event. Many owners think the work starts when a buyer is found. The most successful sales happen when the work is done long before the practice is ever listed. Preparing properly protects your confidentiality and gives you the upper hand in negotiations. The path generally follows a few key stages.
| Stage | What It Involves | Where It Can Get Complicated |
|---|---|---|
| 1. Preparation | Organizing financial records, defining your growth story, and addressing operational weaknesses. | Uncovering inconsistencies in your financial history that can raise red flags for buyers. |
| 2. Valuation | A deep analysis to determine your practice27s market value based on Adjusted EBITDA. | Relying on a simple “rule of thumb” that undervalues your practice’s unique strengths. |
| 3. Marketing | Confidentially marketing the opportunity to a curated list of qualified buyers. | Accidentally breaching confidentiality, which can disrupt staff and patients. |
| 4. Due Diligence | The buyer thoroughly inspects every aspect of your business, from financials to licenses. | Being unprepared for the depth of questions, which can cause delays and reduce trust. |
| 5. Closing | Finalizing legal documents and executing the transition plan. | Navigating complex legal terms and ensuring a smooth handover of operations. |
The due diligence process is where many practice sales encounter unexpected challenges.
What Is Your Practice Really Worth?
A proper valuation is the foundation of a successful sale. It is not about a quick “rule of thumb.” We determine value by looking at your practice the way a sophisticated buyer would. The key metric is Adjusted EBITDA. This figure represents your practice’s true, ongoing cash flow after “normalizing” for things like your personal salary or one-time expenses. It gives a clear picture of the business’s profitability.
From there, we apply a valuation multiple. This number is not random. It is influenced by many factors. Are you heavily reliant on one therapist, or do you have a diverse team? Do you have a track record of growth? Is your billing process efficient? Answering these questions helps us build a compelling story for buyers. Most owners are surprised to learn their practice is worth more than they thought once we reframe the numbers and the narrative.
Curious about what your practice might be worth in today’s market?
Planning for Life After the Sale
The day the deal closes is not the end of the story. A successful exit involves careful planning for what comes next, both for you and for the practice you built. Thinking about these issues ahead of time allows you to structure a deal that truly meets your goals.
Your Transition Role
Most buyers will want you to stay on for a transition period to ensure a smooth handover of patient relationships and operations. You can define the length and scope of this role during negotiations. A clear plan prevents future misunderstandings.
Financial Structure and Your Legacy
The deal is not always 100% cash at close. A portion might be structured as an “earnout,” which you receive if the practice hits future performance targets. Another option is an “equity rollover,” where you retain a minority stake in the new, larger company. This allows you to benefit from the future growth you help create, offering a potential second payday.
Protecting Your Team
Your staff is a huge part of your practice’s value. During negotiations, you can advocate for them by discussing their future roles and opportunities with the new owner. Securing a good home for your team is often a key non-financial goal for sellers.
Your legacy and staff deserve protection during the transition to new ownership.
Frequently Asked Questions
What makes an integrated Speech and Occupational Therapy practice attractive to buyers in New Mexico?
Integrated Speech and Occupational Therapy practices offer a continuum of care, which is efficient for patients and provides a competitive advantage. Such practices are turnkey solutions with strong patient retention and operational soundness, making them highly desirable for individual buyers and larger healthcare groups in New Mexico.
What are the key state-specific considerations when selling a Speech & Occupational Therapy practice in New Mexico?
Key considerations include ensuring that all therapists are fully licensed by the New Mexico Regulation and Licensing Department (RLD), defining the roles of any staff in borderline functions such as unlicensed Speech-Language Pathology Assistants (SLPAs), and clearly articulating the integrated service model’s benefits to patients and the business.
How is the value of a Speech & Occupational Therapy practice typically determined in New Mexico?
The practice’s value is primarily based on a multiple of its Adjusted EBITDA (true cash flow after normalization). Multiples can range from 5.5x to 7.5x or higher, depending on factors like team diversity, growth track record, and billing efficiency. This approach is more accurate than simple revenue rules and reflects the business’s profitability and growth story.
What are the typical stages involved in selling a Speech and Occupational Therapy practice?
The sale process generally includes: 1. Preparation (organizing finances and addressing weaknesses), 2. Valuation (determining market value based on Adjusted EBITDA), 3. Marketing (confidentially reaching qualified buyers), 4. Due Diligence (inspection of financials and licenses), and 5. Closing (finalizing legal documents and transition plans). Each stage has potential complexities to manage.
What should owners consider for life after selling their Speech & Occupational Therapy practice?
Owners should plan their transition role to ensure smooth handover, decide on financial deal structures such as earnouts or equity rollover for future benefits, and advocate for their staff’s future roles with the new owner. Thoughtful planning preserves the owner’s legacy and protects the team during the ownership change.