Healthcare, Education & Personal Services · Buyer guide
Buying a Physical Therapy Practice business
Published · Reviewed by The Diligence Standard Team · Updated
a Physical Therapy Practice can look attractive on a summary P&L while the operating details underneath it change the cash flow, transferability and capital a buyer will actually own. Diligence should connect the reported earnings to the business-specific drivers that create them.
How the business works
Visits per therapist, payer mix, referral sources, clinician retention, billing quality and owner clinical production drive value.
Risks to test
- Owner/referral dependence
- Therapist shortage
- Payer changes
- Billing/AR quality
- Credentialing
- Lease
Evidence to request and reconcile
- Visit/production data
- Payer reports
- Referral-source detail
- Therapist payroll/licenses
- AR aging
- Credentialing
Decision questions
- What profit remains after market pay for owner clinical work?
- Which referral sources dominate?
- How collectible is AR?
- Which therapists are critical?
- What credentialing changes are required?