Waiting feels like the prudent choice. It is the instinct of careful people — the impulse to hold on a little longer, to watch conditions develop, to avoid locking in a decision before the picture is clearer. For physicians who have spent careers making measured, evidence-based judgments, the disposition toward patience feels like a professional virtue applied to a personal decision.
In the context of a practice sale, that instinct deserves scrutiny. Not because urgency is the right posture — it rarely is — but because waiting is not a neutral act. It has costs that are real, compounding, and often invisible until the window that existed at one moment in the market has quietly closed. This post is about those costs: what they are, where they come from, and how to think about them honestly rather than in a way that creates artificial pressure in either direction.
The Market You’re Waiting For May Not Arrive
Physicians who delay a practice sale often do so with a vague expectation that conditions will remain constant or possibly improve — that valuations will rise further, that buyer appetite will strengthen, that some uncertainty in the reimbursement environment will resolve. Sometimes that expectation is correct. More often, it reflects a natural human tendency to project the present forward indefinitely, as though current conditions are the baseline from which things will only improve.
The physician practice M&A market is cyclical, and the conditions that produce high valuations are not permanent. The cost and availability of capital — the leveraged debt that PE-backed platforms use to finance acquisitions — fluctuates with interest rate environments in ways that directly compress or expand the multiples buyers can justify paying. The appetite of health systems to acquire physician practices waxes and wanes with their own financial performance and strategic priorities. Regulatory shifts, reimbursement changes, and macro-economic conditions all interact with the supply of available practices and the depth of the buyer pool in ways that no market participant can predict with confidence.
What we can say with confidence is that the period from approximately 2018 to 2021 represented a historically favorable seller’s market — one driven by abundant cheap capital, aggressive platform-building, and intense competition among buyers. Physicians who sold in that window achieved multiples that, in many specialties, were exceptional by historical standards. Physicians who were considering a sale during that period and chose to wait discovered that the window did not remain open indefinitely. The market that followed was more disciplined, more selective, and in some specialties, meaningfully less favorable to sellers.
The lesson is not that you should sell into any market regardless of your circumstances. It is that the assumption that waiting will produce the same or better conditions is an assumption worth examining carefully, and one that the market does not reliably reward.
Valuations Are Built on Earnings — and Earnings Are Not Static
Practice valuations in M&A transactions are almost universally expressed as a multiple of EBITDA — the normalized earnings of the practice. That means your valuation is a function of two variables: the multiple a buyer will pay, and the EBITDA on which that multiple is applied. Both of these can move, and not always in the same direction.
The multiple a buyer will pay is driven by market conditions — capital costs, buyer competition, specialty dynamics. The EBITDA on which it is applied is driven by the operational and financial performance of your practice. A physician who waits two or three years in the hope that multiples will improve may find that their EBITDA has declined during that period — due to staffing cost inflation, payor rate pressure, or simply the natural trajectory of a practice whose owner is beginning to reduce clinical volume or step back from the pace they maintained in earlier years.
The mathematics here are straightforward. A practice generating $1.5 million in EBITDA transacting at eight times is a $12 million outcome. That same practice two years later, if EBITDA has declined to $1.2 million due to reduced physician activity and multiple has compressed to seven times due to changed market conditions, is now an $8.4 million outcome. The physician waited two years and gave back $3.6 million — not through any bad decision, but through the compounding effect of two variables that both moved in the wrong direction during the waiting period.
This is not a hypothetical. It is a pattern we see with enough regularity that it deserves to be named plainly. Physicians who are reducing their clinical pace — who are seeing fewer patients, performing fewer procedures, or beginning to pull back from the operational responsibilities of the practice — should understand that this trajectory typically reduces EBITDA, and that a transaction negotiated on a declining earnings base produces a meaningfully lower outcome than one negotiated at peak performance.
Preparation Takes Time You Haven’t Started Spending
One of the most concrete hidden costs of waiting is the preparation time that a high-quality transaction requires — and that most physicians significantly underestimate. The practices that achieve the strongest outcomes in a sale process are not simply the ones with the highest earnings. They are the ones that can present those earnings clearly, cleanly, and in a form that withstands the scrutiny of sophisticated buyers and their advisors.
That preparation involves normalizing financial statements to reflect the true economic performance of the practice — stripping out personal expenses, accounting for one-time items, adjusting physician compensation to market benchmarks, and documenting the add-backs that a buyer will credit in their valuation analysis. It involves organizing contracts — payor agreements, facility leases, employment agreements, equipment financing — in a way that presents a coherent picture of the practice’s obligations and rights. It involves resolving compliance matters, updating credentialing, and addressing any operational issues that a buyer’s due diligence team will inevitably surface.
This work takes time — typically six to twelve months of consistent effort before a practice is genuinely ready for a well-run sale process. Physicians who decide they want to transact and expect to close within ninety days are almost always disappointed, and the transactions that close on compressed timelines almost always leave value on the table because the preparation was incomplete.
Every month spent waiting for conditions to improve is a month not spent building the foundation that will make your transaction outcome as strong as it can be. Starting the preparation process early — even before you have made a firm decision to sell — costs nothing and preserves options. Waiting until the decision feels urgent and then rushing the preparation process is a reliable path to a suboptimal outcome.
The Competitive Landscape Is Shifting Around You
While an individual physician considers their timing, the market around them is not standing still. PE-backed platforms are actively acquiring practices in attractive specialties and geographies. Health systems are expanding their employed physician networks. Other independent practices in your market are transacting, and each transaction changes the landscape for the ones that follow.
In some specialties and markets, this dynamic creates a narrowing window. A PE platform that has acquired two or three practices in your specialty in your geography may have satisfied its appetite for that market. A health system that has secured the referral network it was seeking may be less motivated to acquire additional practices in the same area. The competitive pressure among buyers that produces strong outcomes for sellers is a function of buyer appetite, and that appetite is consumed by completed transactions.
The physician who waits while their peers transact may find, when they are finally ready, that the buyer pool in their market has thinned. The platform that was paying aggressive multiples two years ago has moved on to build in other geographies. The health system has shifted its capital priorities. The independent practice that was the most obvious acquisition target in the region is no longer that practice, because others that were equally attractive have already been acquired.
None of this means that waiting necessarily forecloses your options. It means that the options available to you at any given moment are shaped by what has happened around you, and that informed awareness of those dynamics is part of making a timing decision well.
The Personal Costs That Don’t Appear on a Balance Sheet
Everything discussed above is measurable in financial terms. There is another category of cost that is harder to quantify but no less real — the personal toll of operating a business you are ready to exit but have not yet left.
Physicians who have reached the point where a sale feels right — where the administrative burden has become genuinely exhausting, where the succession question has become urgent, where the energy required to run the business is competing directly with the energy available for clinical care — do not typically find that waiting improves their experience of practice. The conditions that make a sale attractive tend to persist and intensify, not resolve on their own.
There is a real cost to continuing to lead an organization through transitions you are no longer fully committed to, to making capital decisions with a timeline you’re uncertain about, and to managing a team whose future you cannot yet clearly define. The emotional and operational weight of ownership under those circumstances is not neutral, and the physicians who have managed it for longer than they needed to describe it as one of the more significant regrets of an otherwise well-managed professional transition.
What Good Timing Actually Looks Like
We are not arguing that every physician should sell immediately. We are arguing that timing should be the product of deliberate analysis rather than default inaction. The relevant questions are not whether the market will improve — no one can answer that reliably — but whether the conditions of your practice and your life are pointing in a clear direction, and whether delaying that direction serves you or simply defers it.
Good timing in a practice sale is almost always earlier than it feels comfortable. It is before earnings peak and begin their natural decline. It is while the physician still has enough runway ahead of them to represent a compelling clinical and operational asset to a buyer. It is while the preparation can happen deliberately rather than reactively. And it is while the market is active rather than after it has shifted.
The physicians who tell us they wish they had started the process sooner are far more numerous than those who tell us they wish they had waited longer. That asymmetry is worth taking seriously.
If you have been thinking about a transaction and finding reasons to wait, we would welcome the opportunity to talk through your specific circumstances — the condition of your practice, the state of the market in your specialty, and what the timing picture actually looks like for you. That conversation costs nothing, and it might clarify the decision in ways that a few more months of waiting will not.
Alexander Price & Co.
Healthcare Transaction Advisory
info@alexanderpriceandco.com | www.alexanderpriceandco.com
The information contained in this post is intended for general informational purposes and does not constitute legal, tax, or financial advice. Physicians considering a practice transaction should consult with qualified legal and financial advisors in addition to an experienced transaction advisor.
