The short answer
A concierge practice sale follows six stages: preparing financial and membership records, establishing a valuation range, approaching qualified buyers confidentially, negotiating a letter of intent, completing due diligence and a quality of earnings review, and closing with a defined transition period. Most physician-owners remain involved for a negotiated period after a concierge practice sale closes.
Quick answers
What is the first step in a concierge practice sale? Preparing records — clean financials, a documented member roster, and membership agreements reviewed by counsel — before any buyer is approached.
Can a practice be sold without staff or members finding out? Yes — a confidential process uses blind profiles and non-disclosure agreements so the practice is not identifiable until a buyer is qualified and bound.
Is a letter of intent binding? Mostly no — the price and structure in an LOI are usually non-binding, while the exclusivity and confidentiality provisions usually are.
What is due diligence in a concierge practice sale? The buyer’s independent verification of everything the seller has represented, covering financial, legal, regulatory and membership records.
Does the selling physician have to keep working after a concierge practice sale? Usually yes — buyers typically require a transition period, and its length and terms are negotiated rather than fixed.
When should members and staff be told? After the transaction is certain, in a planned sequence — staff before members, and never by rumour.
Can a single-physician practice be sold? Yes — single-physician practices transact regularly, though more of the consideration is typically deferred to reflect transition risk.
Key takeaways
- Selling a concierge medicine practice is a six-stage process, and the work that most affects the outcome of a concierge practice sale happens in the first stage, before any buyer is contacted.
- A confidential sale process is standard in membership medicine, because a practice perceived to be changing hands can lose members before a concierge practice sale completes.
- A letter of intent is largely non-binding on price but binding on exclusivity, which means signing one removes a seller’s leverage for the duration.
- Most price reductions occur between the letter of intent and closing, and most are caused by records that did not support what the seller represented.
- Physician-owners should expect to remain involved after closing, and the length and terms of that involvement are negotiable parts of a concierge practice sale.
What are the steps in a concierge practice sale?
There are six: prepare records, establish a valuation range, approach buyers confidentially, negotiate a letter of intent, complete due diligence, and close with a transition plan. The sequence rarely varies. What varies enormously in a concierge practice sale is how long each stage takes and how much of the price survives the fifth one.
| The six stages of a concierge practice sale. Durations vary substantially by practice size, buyer type, and the state of the seller’s records. Stage | What happens | What you decide |
|---|---|---|
| 1 · Prepare | Financials cleaned, member roster documented, agreements reviewed, advisors appointed | Whether to sell at all, and when |
| 2 · Value | Adjusted EBITDA established, valuation range assessed | Whether the range justifies proceeding |
| 3 · Approach | Blind profile circulated, NDAs signed, buyers qualified, meetings held | Which buyers to admit to the process |
| 4 · LOI | Offers received, structure negotiated, exclusivity granted | Which offer to accept, and on what structure |
| 5 · Diligence | Financial, legal, regulatory and membership review; QoE commissioned | How to respond to findings and repricing |
| 6 · Close | Definitive agreements signed, funds flow, transition begins | How and when to tell staff and members |
How do you prepare for a concierge practice sale?
Preparation means putting financial records, membership data, and legal agreements into a condition where an outside buyer can verify them quickly once a concierge practice sale begins. It is the stage with the greatest effect on final price and the only one a seller controls completely. It also takes the longest, and it should begin well before any decision to sell is final.
The financial records buyers expect
Buyers will ask for several years of profit and loss statements, balance sheets, and tax returns, and they will expect the three to reconcile. Beyond that, in a membership practice specifically:
- Revenue broken out by source — membership fees separated from any ancillary, insurance-billed, or fee-for-service lines. A single blended revenue figure invites the buyer in a concierge practice sale to assume the worst about the mix.
- An add-back schedule with documentation attached to each entry, not a list of assertions. Every item will be tested.
- Deferred revenue tracked properly. Annual fees collected in advance represent an obligation to deliver care later. If the accounts do not distinguish cash received from revenue earned, expect that to become a live issue at closing.
- Related-party arrangements identified — rent paid to an entity you own, family members on payroll, personal expenses. Disclose these early. They are always found, and finding them is worse than being told.
Documenting the member panel
This is where concierge practices differ most from other medical practices, and where sellers are most often unprepared. A buyer wants to see the panel as data, not as a description: how many members, joined when, at what fee, renewed how many times, departed when and why where known.
Practices that have never maintained this rigorously can reconstruct it, but the reconstruction is slow, and it frequently reveals a retention picture less flattering than the one the owner carried in their head. Better to find that out privately, years ahead, than in a data room.
Membership agreements and whether they transfer
Have counsel review the agreements against four questions: does the contract assign to a new owner, what notice does a fee change require, what are the termination and refund terms, and do the executed copies on file match the current template?
That fourth question fails more often than owners expect in practices grown over a decade — a template updated three times, with members still on all four versions and some signed copies missing entirely.
Reducing founder dependence before it is measured
A buyer will assess how much of the practice’s value walks out with the departing physician. The structural answer — associate physicians, members comfortable seeing more than one provider, marketing that sells the practice rather than the person — takes years to build. It cannot be assembled during a sale process, which is precisely why it belongs in the preparation stage and why that stage should start early. This is covered in more depth in our guide to how concierge practices are valued.
Assembling the advisory team
Three roles, and they are not interchangeable: a transaction attorney experienced in healthcare, an accountant who can prepare and defend the add-back schedule, and an M&A advisor who runs the concierge practice sale. Appointing them early costs money long before a concierge practice sale exists to pay for it. It is still the cheaper order of operations.
How is the asking range established?
A valuation range is established by calculating adjusted EBITDA — earnings restated to remove owner-specific and non-recurring costs — and assessing what multiple the practice’s characteristics support. Retention history, physician dependence, panel composition, and the transferability of member agreements all move that multiple.
Two points that matter more than the arithmetic.
A range is not a price. It is an assessment of what a category of buyers might pay under a set of assumptions. Buyers with different strategies value the same practice differently, and a competitive process is what discovers which of them values it most.
The range should be established before buyers are approached, not after. A seller who enters conversations without an independent view of value is negotiating against a number the buyer chose. The full method is set out in what a concierge medical practice is worth.
How do you approach buyers without staff or members finding out?
Confidentiality is maintained by controlling what is disclosed and when. Buyers first receive an anonymised summary that describes the practice without identifying it. Only after signing a non-disclosure agreement and being qualified as a credible buyer does anyone learn the practice’s name. Staff and members are told after the concierge practice sale is certain, not while it is being explored.
Blind profiles and non-disclosure agreements
Blind profile A one or two page summary describing the practice — region rather than city, panel size in a band, revenue in a range, model and structure — with nothing that identifies it. Also called a teaser. Non-disclosure agreement A contract binding a prospective buyer to confidentiality before receiving identifying information. Also called an NDA or confidentiality agreement.
The discipline that matters is qualification. An NDA is a legal remedy after a breach, not a prevention of one. Narrowing the field to buyers with a genuine mandate and the means to complete does more for confidentiality than any document.
Why this matters more in membership medicine
In most businesses, a rumour of sale is an inconvenience; in a concierge practice sale it is a revenue event. In a concierge practice it is a direct financial event. Members joined for continuity of care with a specific physician. A member who hears the practice may be sold does not wait to learn the details — some will simply not renew, and the retention figure a buyer is underwriting starts falling during the concierge practice sale that was meant to reward it.
This is also why Concierge Practice Report takes such care with the phrase “in play.” A practice described publicly as being on the market has already paid a price for it.
Where the meetings happen
Not at the practice, at least not initially. Staff notice unfamiliar visitors, and they draw accurate conclusions. Early meetings happen off-site or remotely. Site visits come late in the process, and are usually arranged outside clinical hours.
Confidentiality is a sequence, not a document. What is disclosed, and when, does more work than any agreement signed afterwards.
What is a letter of intent, and what does it commit you to?
A letter of intent is a written outline of the proposed deal — price, structure, timeline, and conditions — signed before definitive agreements are drafted. Most of an LOI is non-binding, including the price. The provisions that usually do bind are exclusivity and confidentiality, and those are the ones that change a seller’s position materially.
Exclusivity is the term that matters
An exclusivity clause — sometimes called a no-shop — commits the seller to stop talking to other buyers for a defined period while the chosen buyer completes diligence.
Understand what that does. Before signing, a seller has competing interest and therefore leverage. After signing, there is one buyer, a clock, and a seller who has told other parties to stand down. If diligence then produces a reason to reduce the price, the seller’s alternatives are to accept, or to restart a process that has now consumed months.
This is not an argument against exclusivity, which buyers reasonably require before spending money on diligence. It is an argument for two things: keeping the exclusivity period as short as is realistic, and doing the preparation work in Stage One so that diligence has nothing to find.
Reading the structure, not just the number
Two offers with the same headline figure can be very different deals. The composition is what determines how much a seller actually receives and when:
- Cash at closing — paid on completion, certain
- Escrow or holdback — a portion retained for a period against post-closing claims
- Rollover equity — a stake retained in the acquiring entity, whose eventual value depends on that entity’s performance
- Earnout — deferred consideration paid only if defined targets are met after closing, frequently membership retention in this sector
- Seller note — a portion the seller finances, repaid over time
A higher headline price with more weight in earnout and rollover carries more risk than a lower price paid mostly in cash. Which is preferable depends on the seller’s circumstances and their read on the buyer — but the comparison has to be made deliberately, and it is a conversation for your advisor and your own tax counsel, not for an article.
What happens during due diligence?
Due diligence is the buyer’s independent verification of everything the seller has represented. It covers financial records, legal and corporate documents, regulatory compliance, employment matters, leases, and — in a membership practice — the member panel in detail. It usually includes a quality of earnings review commissioned from an independent accounting firm.
What a quality of earnings review examines
Quality of earnings (QoE) An independent accounting analysis verifying that reported earnings are accurate and sustainable. Not an audit — a targeted test of whether the earnings presented are real, recurring, and correctly stated.
In a concierge or DPC transaction it typically tests each add-back individually, reconciles member-level revenue against bank deposits, recalculates retention independently from the roster, examines related-party arrangements, and scrutinises revenue recognition on fees paid in advance.
The membership retention analysis
This is the analysis that decides concierge deals. The buyer rebuilds the retention picture from source records rather than accepting the seller’s figure, usually by cohort — members who joined in a given year, tracked forward.
Cohort analysis surfaces things a blended retention rate conceals. A practice can report stable overall retention while its newest cohorts are leaving considerably faster than its oldest — which tells a buyer that recent growth is not durable, and that the stability in the headline number is being propped up by long-tenured members who will eventually age out.
Where deals stall
In rough order of frequency, from what the sector sees repeatedly:
- Membership records that do not support the reported retention. The single most common cause of repricing.
- Add-backs that cannot be documented. Adjusted EBITDA falls, and with a multiple applied, the price falls by more.
- Agreements that do not assign. Discovered late, this can require re-papering the entire panel before closing.
- Undisclosed related-party arrangements. Damaging out of proportion to their size, because they call every other representation into question.
- Regulatory structure issues — corporate practice of medicine, licensing, Medicare opt-out status.
- Lease problems — assignment restrictions, personal guarantees, or a term too short for the buyer’s plans.
Every item on that list is findable in advance by the seller. That is the argument for Stage One, stated as plainly as it can be.
What happens at closing, and what is your role afterwards?
At closing, definitive agreements are signed, funds are transferred, and ownership passes. The seller’s role does not end there. Most concierge transactions include a transition period during which the selling physician continues to practice, introduces members to colleagues, and transfers institutional knowledge. Its length and terms are negotiated as part of the deal.
Post-closing commitments
Expect the definitive agreements to address a continued clinical role and its compensation, a non-compete and non-solicitation covenant, cooperation with any earnout measurement, and indemnities backed by the escrow. Each is negotiable. Each should be reviewed by your own counsel, since these are the terms that govern your working life after the money has arrived.
Telling staff and members
Sequence and timing do more damage than content when handled badly.
Staff first, and in person. They will be asked by members and need to know before they are. Staff who learn of a sale from a member do not recover their confidence quickly.
Members after, and from the physician. A letter over the practice’s name reads as an administrative notice. A letter from the physician who has cared for them reads as what it is. Say what continues, name who they will see, and be specific about what changes — vagueness is read as bad news being withheld.
Not before the concierge practice sale is certain. A sale announced and then abandoned costs members and staff, and there is no way to un-tell it.
How long does a concierge practice sale take?
The stages after preparation follow a fairly consistent rhythm; the preparation stage varies enormously, because it depends on the condition of the records at the start. A practice with clean financials, documented membership data and reviewed agreements moves through the process substantially faster than one reconstructing three years of member history from memory and bank statements.
What does a concierge practice sale cost?
Sellers typically bear advisory fees, legal fees, and accounting fees. Advisory fees are commonly structured as a success fee calculated on transaction value, sometimes with a retainer credited against it. Legal and accounting costs are usually billed hourly and are incurred whether or not the transaction completes — a point worth understanding before diligence begins.
Can a boutique or single-physician concierge practice sale work?
Yes. Single-physician and small concierge practices transact regularly. The process is the same six stages, and the differences are matters of degree rather than kind: the buyer pool tilts toward individual physicians and smaller groups alongside platforms, physician dependence is a larger factor in structure, and more of the consideration is typically deferred into an earnout or a transition arrangement reflecting the handover risk.
What does not change is that preparation determines the outcome. A well-documented small practice frequently transacts more cleanly than a larger one with disorganised records.
Frequently asked questions
What are the steps in a concierge practice sale?
There are six stages: preparing financial and membership records, establishing a valuation range, approaching qualified buyers confidentially, negotiating a letter of intent, completing due diligence including a quality of earnings review, and closing with a defined transition period.
Is a letter of intent legally binding?
Partly. The commercial terms in a letter of intent, including price and structure, are usually non-binding. The exclusivity and confidentiality provisions are usually binding, which means signing one commits a seller to stop talking to other buyers for a defined period.
Can I sell my practice without my staff and members knowing?
Yes. A confidential process uses an anonymised blind profile and non-disclosure agreements so that no buyer learns the practice’s identity until they are qualified and legally bound. Staff and members are informed after the concierge practice sale is certain, in a planned sequence.
What is a quality of earnings review?
A quality of earnings review is an independent accounting analysis, commissioned by the buyer, verifying that reported earnings are accurate and sustainable. It is not an audit. In a concierge transaction it tests add-backs individually and recalculates membership retention from source records.
Why does a concierge practice sale fall through or get repriced?
Most repricing happens between the letter of intent and closing, and the most common cause is membership records that do not support the retention the seller reported. Undocumented add-backs, agreements that do not assign to a buyer, and undisclosed related-party arrangements are the next most frequent.
Do I have to keep working after a concierge practice sale?
Usually, for a negotiated period. Most concierge transactions include a transition during which the selling physician continues to practice and introduces members to colleagues. The length, compensation and terms of that period are negotiable parts of the deal.
When should I tell my staff and members about a concierge practice sale?
After the concierge practice sale is certain, never during exploration. Staff should be told first and in person, because members will ask them. Members should hear from the physician directly, with specific information about what continues and who they will see.
Can a single-physician concierge practice be sold?
Yes. Single-physician practices transact regularly. The process is identical, though physician dependence typically means more of the consideration is deferred into an earnout or transition arrangement that reflects the handover risk.
Preparation is the stage that decides the rest
Almost everything that reduces a price is discovered in diligence and was fixable in preparation. If a sale is anywhere on your horizon, the work worth doing now is the work that happens before a buyer is ever contacted.
Read next: what a quality of earnings review tests →
Informational only; not legal, tax, or investment advice. Every concierge practice sale is unique — consult qualified advisors.
Common mistakes in a concierge practice sale
- Starting too late. The preparation that lifts a concierge practice sale takes years, not weeks.
- Talking to one buyer. A single unsolicited bidder sets the price; a competitive concierge practice sale discovers it.
- Ignoring assignability. Membership agreements that do not transfer will be repriced during any concierge practice sale.
- Telling staff early. Nothing destabilises a concierge practice sale faster than a rumour on the front desk.
- Skipping the add-back schedule. Undocumented adjustments simply disappear from the final number.
Related reading
A concierge practice sale is one chapter in a longer story. These guides cover the valuation that sets the range and the buyers who respond to it.
- What is a concierge medical practice worth?
- Who buys concierge medical practices — and what each one wants
- What is a quality of earnings review?
- What is adjusted EBITDA in a medical practice sale?
- Transitioning out of a concierge practice: your real options
