PE is back. After a three-year slowdown, recapitalization transactions for PE-backed physician practice management platforms are expected to return in force in 2026, according to Healthcare Business Today. Add-on deal activity in healthcare ticked up 19% in 2025. In GI, cardiology, and dermatology, the consolidation wave is accelerating — not slowing.
If you own a specialty practice, you have probably noticed. PE firms have been calling. Competitors have been acquired. And if you have spent any time thinking about the next five years, one question keeps surfacing: should I sell, or should I be doing what PE is doing?
The answer is that you can run the same physician practice acquisition playbook — using debt instead of equity — and keep 100% of the upside yourself.
Key Takeaways:
- PE firms are reigniting physician practice rollups in 2026, with the strongest activity in GI, cardiology, and dermatology
- Physician-owners can execute the same physician practice acquisition strategy using debt financing — without surrendering equity
- Add-on practices typically trade at 4-6x EBITDA; platforms at scale — typically mid-to-high teens EBITDA — can exit at 12-14x — the multiple arbitrage accrues to whoever builds the platform
- Healthcare-focused lenders will finance physician-owned acquisitions when proforma combined EBITDA exceeds $5MM — ideally $10MM+ — and payor mix is commercially weighted
- Moving before the acquisition universe narrows further is the strategic imperative for independent specialty groups in 2026
What Are PE Firms Actually Doing in Specialty Practices Right Now?
PE firms are executing a disciplined consolidation strategy. They identify fragmented specialty markets, acquire independent practices at relatively modest valuations, build integrated platforms, and exit at substantially higher multiples.
The data is clear. In GI specifically, Cardinal Health’s Specialty Alliance absorbed GI Alliance, Solaris, and Urology America in a single consolidation wave — demonstrating how quickly the independent practice universe can contract. As of 2026, more than 35 active PE-backed dermatology platforms operate in the U.S., according to Healio and Physician Growth Partners data. In cardiology, six acquisitions closed in just the first two quarters of 2025, matching all of 2024. The AMA reports that approximately 6.5% of physicians worked in PE-owned practices in 2024, up from 4.5% in 2022 — concentrated disproportionately in high-value specialties.
The pace is not slowing. The window for independent practices to build scale before the acquisition universe narrows further is shorter than it was two years ago.
How Does the Multiple Arbitrage Work — and Who Captures It?
This is the core of the PE playbook, and it is simpler than it looks.
PE firms acquire add-on practices at 4-6x EBITDA — the going rate for a well-run but independent specialty group. They integrate those practices into a platform. When the platform reaches sufficient scale, it commands a dramatically higher exit multiple: 12-14x EBITDA, according to FOCUS Bankers’ Physician Practice M&A Multiples 2026 report. The value created in between belongs entirely to the entity that built the platform.
The key variable is scale — platform exit multiples of 12-14x require EBITDA in the mid-to-high teens. Here is what the math looks like for a physician-owner at a typical entry point:
| Sell your practice to PE today | Build a platform, then sell | |
|---|---|---|
| EBITDA at exit | ~$5MM (your current practice) | ~$16-18MM (platform at scale) |
| Exit multiple | 5-6x | 12-14x |
| Approximate proceeds | ~$25-30MM | ~$200MM+ |
| Who captures future upside | PE — they own the platform from here | You — 100% |
The arbitrage does not belong to PE by nature. It belongs to whoever builds the platform. A physician-owner who acquires add-on practices — using debt to fund each transaction — and reaches platform scale before selling captures the full multiple expansion. The PE firm would have done exactly the same thing, except the physician-owner keeps the equity.
What Does Physician Practice Acquisition Financing Look Like Without PE?
For physician-owned platforms with proforma combined EBITDA above $5MM — ideally $10MM+ — physician practice acquisition financing is available from healthcare-focused lenders. Not SBA programs designed for single-location practices, but institutional private credit and specialty finance companies that have underwritten these transactions dozens of times. The proforma figure is what matters: lenders size the loan to the combined entity after the acquisition closes, not just the existing platform.
What lenders actually evaluate:
- Proforma EBITDA and cash flows — lenders size the loan to the combined entity, not just the existing platform
- Payor mix — commercial-heavy practices command stronger terms; Medicaid concentration receives greater scrutiny
- Management depth — lenders want to see that integration is operationally manageable
- Physician contracts — contract length and departure protections matter significantly in credit analysis
- Integration history — if you have already acquired and successfully integrated one practice, the second transaction is markedly easier to finance
A typical structure for a physician-owned add-on acquisition: senior term loans at around 4x proforma EBITDA with minimal amortization. The practice does not give up equity. The physician-owner retains full ownership of the platform being built.
RCM companies have been running the same playbook. If you want to see how the build-not-sell argument works in another healthcare sub-sector, this piece on RCM market consolidation covers the same mechanics for revenue cycle management platforms.
Platforms like CAPX connect physician-owned practices to the healthcare-focused lenders who have done these transactions before — which is exactly the advantage PE firms have that independent physicians typically lack. Talk to CAPX before PE calls.
When Does Building Independently Beat Selling to PE?
The decision depends on where you are and what you want.
Selling to PE today means liquidity now, but at the cost of ownership. PE structures typically leave physicians with 30-40% equity in the combined platform, after management fees, preferred returns, and carried interest. The PE firm and its investors capture the majority of the eventual exit.
Building independently using debt means more risk and more work — but a fundamentally different economic outcome. A physician-owner who builds a 10-location GI platform and sells in five years owns 100% of the exit value. Cash flows service the debt during the build period; the principal is repaid at exit. The equity appreciation is entirely theirs.
The window to build is not unlimited. As PE consolidation continues in GI, cardiology, and dermatology, the acquisition universe of independent practices available to purchase shrinks each year. The physician-owner who waits for a cleaner moment may find fewer acquisition targets at reasonable multiples.
If you are currently receiving PE outreach and your platform — combined with a target acquisition — would exceed $5MM in proforma EBITDA, physician practice acquisition financing is likely available to you today. Contact CAPX to explore your options.
Bottom Line
PE is not doing anything a physician-owner cannot do. The multiple arbitrage is real, and it accrues to whoever builds the platform. For platforms with proforma combined EBITDA above $5MM — ideally $10MM+ — with clean financials and a commercially weighted payor mix, the debt is available. What has historically been missing is access to the right lenders. That gap is solvable.
