Valuation Multiples by Industry: Healthcare Services 2025
Based on a review of 2024–2025 transaction data, industry research, and recent client engagements, this report summarizes prevailing valuation ranges across major healthcare service sectors. The findings reflect consensus trends observed in private equity platform investments, strategic acquisitions, and specialty roll-ups.
What you’ll learn in this article
Scale premium is real: Practices at ~$5M+ EBITDA often trade 2-4 multiple turns above smaller add-ons. Larger PE platforms can achieve multiples into the teens.
Ancillaries drive value: owned ASCs, imaging, pathology, and cath labs commonly add 1–3 turns to EBITDA multiples.
Hottest lanes: Cardiology and GI show the fiercest buyer competition in 2025, with ophthalmology (retina) commanding strategic interest.
Payor mix = quality of earnings: Well-diversified, in-network payor strategies are preferred, with government pay appropriate for the service line. >70% commercial or strong cash-pay components correlate with top-quartile outcomes.
Strategic stretch: Recent transactions suggest distributors, payors, and health systems may pay 20–40% more than pure financial buyers when synergies are clear.
Following record-high valuations in 2021–2023, tightening credit and higher physician compensation costs have led to normalized pricing in 2025. Median healthcare services EV/EBITDA multiples have moderated to roughly 11.5×, down from 14.5× in 2024, with the widest dispersion seen between small add-ons and large, infrastructure-rich platforms.
Healthcare Services EBITDA Multiples by Specialty
The healthcare services sector exhibits significant variance in valuation multiples, depending on specialty type, practice size, and buyer category.
| Specialty / Vertical | Platform Multiple (EBITDA) | Add-On Multiple (EBITDA) | Notes / Common Key Drivers |
|---|---|---|---|
| Physician Practices (Primary Care, Cardiology, GI, Orthopedics, Dermatology) | ~10×–12× for scaled multi-site groups | ~5×–9× for single or limited-site practices | Diversified bench, ancillaries, and strong commercial mix. |
| Dental Support Organizations (DSO) | ~9×–11× for multi-location groups (pedo/ortho, OMS) | ~5×–8× for single-site or <$1M EBITDA | Multi-office density, provider leverage, and hygiene recall programs drive upper-range results. |
| Behavioral Health | ~9×–13×+ for large, multi-state platforms | ~3×–8× for smaller regional or single-site clinics | Premiums for in-network contracts, continuum of care, and accredited programs; discounts for OON/self-pay mix or staffing churn. |
| Ophthalmology | ~10×+ for multi-ASC or retina platforms | ~5×–9× for single or mid-sized groups | ASC ownership, premium lens conversion, and retina services lift valuations |
| Women’s Health (OB/GYN) | ~8×–11× for diversified, multi-provider groups | ~5×–8× for single-office or limited-scope practices | Imaging, fertility, and menopause programs raise value; heavy OB call burden or med-mal trends depress multiples. |
| Medical Spa / Aesthetics | ~7×–12× for scaled multi-state brands | ~3×–8× for single-site or early-growth chains | Membership/subscription revenue and multi-market replication justify higher EBITDA multiples. |
Key Research Findings
Platform and Large Practice Premium: Practices with $5M+ EBITDA typically achieve 2-4 multiple points higher than smaller add-on acquisitions
Ancillary Revenue Impact: Specialties with owned ambulatory surgery centers or cath labs, imaging, and other ancillary facilities often command premium multiples
Buyer Competition: Cardiology, ophthalmology, and gastroenterology have seen the most aggressive bidding from private equity platforms
Healthcare M&A Transaction Value by Practice Size
Scale lowers execution risk and supports corporate infrastructure, so buyers reliably pay up as EBITDA rises. The table shows median multiples by earnings tier, the typical deal type at each tier, and who buys those assets.
| Practice EBITDA Range | Median EBITDA Multiple | Transaction Type | Typical Buyers |
|---|---|---|---|
| <$500K | 4.5x | Add-on/Bolt-on | Regional groups, hospitals |
| $500K – $1.5M | 6.2x | Add-on | Nearby PE platforms, health systems |
| $1.5M – $3M | 7.8x | Add-on | PE platforms, health systems |
| $3M – $5M | 9.1x | Smaller Platform | New PE platform, established platforms entering a new market, health systems |
| $5M+ | 11.3x | Platform | PE platform creation, strategic buyers |
*Actual pricing varies with each transaction based on many factors. Intended for educational purposes only and not a guarantee of any outcome.
Key Research Findings
Scale Premium: Practices above $3M EBITDA can achieve 80% higher multiples than sub-$1M practices
Platform Threshold: Most private equity firms require a minimum $3M EBITDA for platform investments (with many requiring $5M)
Strategic Value: Buyers often pay premiums for practices that can serve as regional consolidation platforms
Payor Mix Impact on Healthcare Valuation Multiples
Payor composition is a direct proxy for revenue quality and earnings durability. Below, see an illustration of how different profiles can map to EBITDA ranges, buyer preference, and key risks to underwrite.
| Payor Mix Profile | EBITDA Multiple Range | Revenue Quality | Buyer Preference | Risk Factors |
|---|---|---|---|---|
| >70% Commercial | 8.5x – 12.0x | Premium | High | Minimal |
| 50-70% Commercial | 6.5x – 9.5x | Standard | Moderate | Contract renewals |
| Mixed (Balanced) | 5.5x – 8.0x | Stable | Good | Reimbursement changes |
| >50% Medicaid | 4.0x – 6.5x | Government-dependent | Specialty-dependent | Regulatory cuts |
| Cash-Pay/Elective | 7.0x – 15.0x | Variable | Specialty-dependent | Economic sensitivity |
Key Findings
Commercial Insurance Premium: Practices with predominantly commercial payor mix may achieve 40-60% higher multiples
Government Reimbursement Risk: Medicaid-heavy medical practices face valuation discounts due to potential rate reductions.
Cash-Pay Volatility: Self-pay specialties show the widest multiple ranges based on market positioning and investor interest in the space (e.g., high interest in plastic surgery and aesthetics. Lower interest in Lasik-only practices).
Recent Healthcare Services Transactions
Select 2024–2025 transactions illustrate where market-clearing prices have landed for billion-dollar platforms. While smaller deals clear at lower prices, these comps frame what strategics will pay when vertical integration or supply-chain synergies are material.
| Transaction | Specialty | Deal Value | Buyer Type | Strategic Rationale |
|---|---|---|---|---|
| Retina Consultants of America | Ophthalmology | $4.6B | Strategic (Cencora) | Vertical integration |
| GI Alliance | Gastroenterology | $2.8B | Strategic (Cardinal Health) | Supply chain synergies |
| Core Oncology | Oncology | $2.49B | Strategic (McKesson) | Drug distribution synergies |
| OneOncology | Oncology | $2.1B | Financial (TPG) | Platform expansion |
Key Research Findings
Strategic Premium: Strategic buyers may pay significant premiums vs. financial buyers for synergistic value
Scale Advantage: Billion-dollar platforms can achieve multiples 2-3x higher than typical practice sales
Vertical Integration: Healthcare distributors are actively acquiring practices to control supply chains
Requesting a Copy of This Report
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Sources
FOCUS Investment Banking – “What is the Value of my Medical Practice?” (Eric Yetter, 2023). Accessed at: focusbankers.com.
DueDilio Industry Guide – “Healthcare Business Valuation: Methods, Metrics & Expert Tips” (June 2025). Accessed at: duedilio.com.
Peak Business Valuation – “Medical Practice Valuation Multiples” (June 2025). Accessed at: peakbusinessvaluation.com.
American Health Law Assoc. – “Healthcare Transactions in 2024 – Notable Deals” (Ankura, Apr 2025). Accessed at: americanhealthlaw.org.
VMG Health – “A New Buyer in Physician Practice M&A – Strategic Transactions” (Tim Spadaro, Oct 2024). Accessed at: vmghealth.com.
TCTMD / JACC – “Private Equity Interest in Cardiology Has Spiked in Recent Years” (Todd Neale, July 2024). Accessed at: tctmd.com.
Helix Health Capital – “EBITDA vs. EBPC: Valuation in Physician Practice Acquisitions” (Kayla Ballesteros, 2023). Accessed at: helixhealthcapital.com.
M&A Healthcare Advisors – “Understanding Value Based on EBITDA Multiples” (2023). Accessed at: mahealthcareadvisors.com.
Palladium Business Brokers – “How to Prepare Your Practice for Sale: A Checklist” (Mar 2025). Accessed at: palladiumbb.com.
Stifel – “HEALTHCARE SERVICES: Market Update February 2025” (Feb 2025). Accessed at: stifel.com.
