Guide to Selling a Telehealth & Digital Therapy Solutions Practice in Ohio

If you own a telehealth or digital therapy practice in Ohio, you are in a unique market. Recent legislation has created a favorable environment for growth, making your practice an attractive asset for potential buyers. However, capitalizing on this opportunity requires informed navigation of state-specific regulations and buyer expectations. This guide covers the key market dynamics, valuation drivers, and strategic considerations for selling your Ohio-based telehealth practice.

A Market Primed for Growth

The market for telehealth and digital therapy in Ohio is not just growing. It is supported by a legislative framework that actively encourages expansion. The passage of House Bill 122, the Telemedicine Expansion Act, has fundamentally improved the landscape for virtual care providers.

This creates a strong seller’s market driven by a few key factors:

1. Mandated Reimbursement: The law requires both public and private insurance plans to cover telehealth services, ensuring stable revenue streams.
2. Broadened Scope: HB 122 expanded the definition of telehealth to include audio-only calls and secure messaging, allowing you to serve a wider patient population.
3. High Patient Demand: Patients increasingly prefer the flexibility of virtual care, and statewide physician shortages make telehealth a necessary solution for access.

These conditions make established, well-run Ohio telehealth practices highly sought-after by regional health systems and private equity buyers looking for a foothold in the state.

What Buyers Scrutinize in an Ohio Telehealth Practice

While the market is strong, buyers are meticulous. They look past the high-level opportunity and dig into the operational details to assess risk. When preparing for a sale, you should be ready to answer tough questions about three main areas.

Strict Regulatory Compliance

A buyer will want proof of your practices adherence to all Ohio telehealth laws. This includes documented patient consent for telehealth services, clear billing practices that align with payer policies, and meticulous records that follow the standards of care outlined in the Ohio Administrative Code.

State-by-State Licensing

Licensing is a critical point of diligence. While Ohio’s participation in the Interstate Medical Licensure Compact (IMLC) helps physicians, most other professionals (like therapists and social workers) must hold a specific Ohio license to treat patients in the state. A buyer will verify the licensure of every provider to understand the practice’s legal standing and limitations on serving out-of-state patients.

Technology and Security

Your technology platform is a core asset. Buyers will evaluate its security, HIPAA compliance, and user-friendliness for both patients and providers. Having a robust and secure system is a significant value driver. A history of data breaches or an outdated platform can be a major red flag.

Consolidation Is the Trend

You will not find much public data on the sale price of a practice just like yours down the street. These transactions are almost always private. However, the broader M&A trends in telehealth tell a clear story: the market is consolidating.

We see larger telehealth platforms and private equity groups actively acquiring smaller, well-run practices to gain market share and talent. For example, the recent acquisition of innovaTel by Iris Telehealth shows that even specialized segments like telepsychiatry are seeing significant investment. For an Ohio practice owner, this means there are sophisticated buyers looking for acquisition opportunities right now. Finding them, however, requires a targeted approach.

The Path to a Successful Sale

Selling a medical practice is a structured process, not a single event. While every deal is unique, the journey generally follows a clear path. Understanding these stages can help you prepare for what lies ahead.

1. Preparation and Valuation. This is the foundational step. We work with owners to analyze financials, normalize for owner-related expenses to find the true Adjusted EBITDA, and prepare marketing materials that tell a compelling story about the practice’s growth potential.
2. Confidential Marketing. We identify and confidentially approach a curated list of qualified buyers. This protects your staff and patients from the uncertainty of a potential sale while we gauge interest.
3. Negotiation and Offer Selection. Once offers are received, we help you evaluate them not just on price, but on structure, cultural fit, and post-sale terms. We manage negotiations to secure the best possible outcome.
4. Due Diligence and Closing. This is where the buyer verifies all your operational, financial, and legal information. Being well-prepared is critical to prevent surprises that could delay or derail the closing.

How Is a Telehealth Practice Valued?

Many practice owners believe their company’s worth is tied to revenue or net income. In reality, sophisticated buyers value your practice based on its Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization). This figure represents the true cash flow of the business after adding back owner-specific and one-time expenses.

That Adjusted EBITDA is then multiplied by a number (the “multiple”) to determine the practices Enterprise Value. The multiple is not fixed. It is influenced by the quality and risk of your practice.

Key Value Drivers for Telehealth

• Payer Mix: A healthy balance of private insurance, Medicaid, and private-pay clients demonstrates stability.
• Patient Retention: High retention rates and low patient acquisition costs prove you have a strong service model and brand.
• Technology Platform: A modern, secure, and integrated technology stack is a significant asset that buyers will pay a premium for.
• Provider Base: A practice that does not rely solely on the owner is less risky and therefore more valuable.

A proper valuation uncovers this true earning power and frames the story that justifies a higher multiple.

Planning for Life After the Sale

The final sale price is just one part of the equation. How the deal is structured has major implications for your after-tax proceeds, your role after closing, and your team’s future. It is important to think about what you want your transition to look like. Many deals today include components that keep the owner involved.

• An Earnout: This is a portion of the sale price that is paid out over several years, contingent on the practice meeting certain performance targets. Buyers use it to ensure a smooth transition.
• An Equity Rollover: This is when you “roll over” a percentage of your ownership into the new, larger company. It allows you to take cash off the table now while participating in the future growth of the combined entity, offering a potential “second bite of the apple” when the larger company is sold later.

The right structure depends entirely on your personal and financial goals. A good advisor helps you negotiate terms that protect your legacy and align with your vision for the future, whether that involves staying on or moving on to your next chapter.