How to Buy a Medical Practice, Clinic or Pharmacy in 2026
by Raises.com
This article is general information, not legal, tax, securities or investment advice. Laws, rates and programs change, and the details here may no longer be current. Confirm anything you plan to act on with your own counsel and accountant.
A buyer who is not a licensed clinician can fund a medical practice, clinic or pharmacy with investor capital, but the license decides the structure before any money moves. Where corporate practice of medicine rules apply, a licensed owner holds the practice and your company runs the rest. The lender then reads payer mix, receivables and the seller's exit.
Why the license comes before the price
A practice earns its revenue from clinicians who bill payers under their own licenses and enrollments, so the thing you are buying can stop earning the day the wrong person owns it. A car wash keeps washing cars under a new owner. A practice keeps billing only if the license and the contracts follow. Price that risk first.
1. Settle who may own it before you price it
Many states keep a corporate practice of medicine rule, which bars a company owned by non-clinicians from employing physicians or owning the practice that bills for their care. Get a healthcare lawyer's answer for the practice's state before the letter of intent. Everything else follows from it.
Where the rule applies, the standard answer is two companies. A clinician-owned professional corporation holds the practice and signs the payer contracts. Your management company, owned by you and your investors, supplies the space, the non-clinical staff, billing and equipment under a management services agreement for a fee. The fee is your revenue. That agreement is your collateral, and the lender reads it line by line.
A pharmacy answers to the state board of pharmacy instead. The board issues the permit, requires a pharmacist in charge on it, and decides whether a new owner needs a new permit and whether a non-pharmacist may own the store. Ask before you sign. If the store dispenses controlled substances, ask the DEA how its registration moves to a new owner. Make both answers closing conditions.
2. Match the debt to who operates
The SBA lends to operating businesses, and the cleanest SBA 7(a) fit is a licensed clinician buying a practice they will run, in a deal under the program's $5M cap. A non-clinician buyer is a harder file. Your company runs the management side, and someone else's license covers the clinical side. Ask the SBA lender in writing whether it will lend into that structure.
Neither client file here is a physician practice or a pharmacy. Dave Klivans, co-founder of ag.online, worked with Raises.com®, and his acquisitions include a memory care facility secured by SBA and commercial bank debt. That is licensed care inside a building, the closest file we have. For his lenders, the team built a family-office-level financial model across his personal and business entities to surface the DSCR metrics they required. Do the same here.
The practice, the management company and your personal statement should reconcile in one model, because a lender who reads three sets of numbers that disagree stops reading. Above the cap, the senior debt is usually a bank loan to the management company. Its covenants sit on the fee. If the clinician's entity can cut that fee, the loan is weaker.
3. Read the collections, not the charges
A practice bills its full charges and collects far less, because payers pay their contracted rates, deny some claims and take some payments back after an audit. A lender underwrites what was collected. So should you.
Pull the payer mix by month for the last two years: Medicare, Medicaid, each commercial plan and cash pay. Concentration is the risk. A practice that collects most of its money from one commercial plan can lose a large part of its revenue when that contract renews lower.
Then age the receivables. Ask for the aging report, the denial log and every credit balance. A credit balance is money the practice owes back to a payer or a patient, and it becomes yours if you buy the entity. Old receivables lose value every month they sit.
A pharmacy adds two lines. Its reimbursement runs through pharmacy benefit managers, so read each contract and its audit history. Count the inventory on closing day and price it at cost, as its own line apart from goodwill.
4. Write the selling clinician's exit into the deal
Patients follow the clinician they know, which makes the seller the key person in the deal and the first thing a lender asks about after the payer mix. Put the transition in writing. The agreement should say how long the seller stays, how many days a week they see patients, and how they introduce a successor.
Tie part of the price to the handover. A seller note that pays out while the seller still sees patients keeps them invested after close, and the lender sees a seller with money riding on the transition. Settle the malpractice tail too. A claims-made policy needs one, or claims from care before close have no policy behind them.
5. Put investor equity where the license allows it
Investors buy into the management company through an SPV that owns it, never into the professional corporation that holds the license. That line protects the structure. The PPM should describe the management agreement, name the licensed owner, explain how that owner is replaced, and say what happens if a board or payer challenges the arrangement. File Form D within 15 days of the first sale.
Ade worked with Raises.com® and went from no deals funded to closing two acquisitions. His thesis was defensible industries such as real estate and essential services, capital preservation, and returns that are predictable. A medical practice can fit that thesis. It fits only when the payer mix, the receivables and the seller's exit are on paper before the first investor call.
Practice vs clinic vs pharmacy
| Question | Medical practice | Clinic | Pharmacy |
|---|---|---|---|
| Who licenses it | The state medical board licenses the physicians | State boards license the clinicians; some clinic types also need a state facility license | The state board of pharmacy issues the pharmacy permit |
| Ownership question to answer first | Whether a corporate practice of medicine rule bars non-clinician ownership | The same question, for every clinician who bills | Whether a non-pharmacist may own it, and who the pharmacist in charge will be |
| Structure for a non-clinician buyer where the rule applies | A management services company plus a clinician-owned professional corporation | The same two companies | Ownership as the board allows, with a pharmacist in charge on the permit |
| What the lender reads first | Collections by payer and the receivables aging | Collections by payer, receivables and visit volume | Benefit manager reimbursement, inventory and prescription volume |
| Key person | The selling physician | The lead clinicians and the medical director | The pharmacist in charge |
| SBA 7(a) fit | Cleanest when a licensed buyer will operate and the deal is under the $5M cap | The same test | When your company operates the pharmacy and the deal is under the $5M cap |
Frequently asked questions
Can a non-doctor own a medical practice?
Yes, through a management services company, while a licensed clinician owns the practice itself in states with corporate practice of medicine rules. The two are tied by a management services agreement. Get the state's answer before you sign.
Can I use an SBA 7(a) loan to buy a medical practice?
Yes, when your company will operate the practice, the deal fits under the $5M SBA 7(a) cap, and you meet the SBA's eligibility rules. A licensed buyer who will see patients is the cleanest file. For a management company structure, get the lender's answer in writing first.
What does a lender look at when you buy a practice?
Collections by payer, the receivables aging, credit balances owed back, and the seller's transition plan. Charges matter less than collections. The seller's exit is read as hard as the numbers.
Who keeps the receivables when you buy a practice?
Whoever the purchase agreement names. In an asset purchase the seller often keeps receivables billed before close, so plan working capital as if you start collecting from zero. Write the cutoff date into the agreement.
Can investors own part of a pharmacy?
Ask the state board of pharmacy first, because it decides who may own the permit holder. Where outside owners are allowed, investors buy into an SPV that owns the pharmacy company. The pharmacist in charge stays on the permit.
Raises.com® builds the structure behind the purchase of a business or a building, practices included: the PPM, the subscription and operating agreements, the CFA financial proformas and the data room. That keeps the raise legally and financially sound. See how acquisition capital gets structured at https://raises.com/buy-a-business, or book a strategy call at https://raises.com/call.
General information, not legal, tax, securities or investment advice. Laws, rates and programs change, and the details here may no longer be current. Confirm anything you plan to act on with your own counsel and accountant.