How Much Is My Healthcare Practice Worth?

Free medical practice business valuation

1. Earnings

Use your most recent full year — your tax return or P&L. Estimates are fine; you can change any answer later.

Annual revenue

Total sales before expenses. Example: 850000

Reported profit

Net profit before income tax, as shown on your P&L or tax return. Enter a negative number for a loss. Example: 95000

Owner pay

Salary, draws, payroll taxes and benefits paid to one working owner. Example: $70,000 salary + $8,000 health insurance = 78000

Interest, depreciation & amortization (optional)

Non-cash and financing costs on your P&L. Example: 12000 of depreciation on a work truck

One-time or personal expenses (optional)

Costs a new owner wouldn't have. Example: a 6000 legal settlement, or a family member's phone paid by the business

Seller's discretionary earnings (SDE): —

Profit + owner pay + add-backs. SDE is what one full-time owner-operator takes home, and it's the standard earnings figure buyers use for businesses selling under about $2M.

2. About your business

Industry

State

Years in business

Revenue change vs. prior year (%) (optional)

Employees, not counting you

Your role day to day

I run daily operationsStaff handle most of it; I overseeIt runs without me

3. What transfers to a buyer

Check everything that applies.

Recurring revenueCustomers pay on a regular schedule, such as memberships, subscriptions or service plansCustomer contracts of 6 months or moreSigned agreements that would transfer to a new ownerOne customer is more than 25% of revenueBuyers look closely at how dependent revenue is on a single customerThe business owns its building or landProperty is valued separately and isn't included in the estimate

How Health & Medical businesses are valued

Healthcare practices (medical, therapy, allied health) are usually priced on seller's discretionary earnings (SDE), or on EBITDA for larger practices, with recurring patient revenue, insurance contracts, and practice size all affecting the multiple. Practices with a diversified payer mix and minimal owner-practitioner dependency command the highest prices.

Across all industries, small businesses selling for under $2M averaged 2.0×–3.1× SDE (IBBA & M&A Source Market Pulse, Q4 2025). The calculator above starts from these averages; businesses in your industry may trade above or below them.

What buyers look for

→Consistent patient volume and revenue trend
→Payer mix — insurance vs. cash pay split
→Staff credentialing and retention
→EMR data and documented patient records

What increases your valuation

✓Recurring patient base with low churn is the most important driver
✓Multiple revenue streams (ancillary services, products) increase value
✓Real estate ownership vs. lease is a major factor