After advising more than 25 physician groups on successful partnerships with private equity, we've seen one rule hold true: PE pays more for practices with higher and growing EBITDA ("owner's profit"). Yet, many practices have struggled as wages climb faster than reimbursement. Here are three strategies we've seen boost EBITDA — and your practice's value — without sacrificing patient care.
1. Fully Utilize Mid-Levels, Then Add More
Mid-levels (e.g., nurse practitioners, physician assistants) often boost your bottom line because their pay is significantly lower than a doctor's, while their reimbursement rates are only slightly lower (typically 85–90% of a doctor's). However, this only works if mid-levels are well-trained, well-compensated, and both highly utilized and productive.
Hiring, Training, and Retaining Mid-Levels: Successful practices take one of two paths: hire less experienced mid-levels and invest in a structured training program, or pay more for experienced hires who need less training. Whichever path you choose, create a clear career roadmap and pay structure from Day 1.
Utilization and Productivity: The most profitable practices have a common profile — their providers are both highly utilized and productive. A mid-level who's underutilized spends time idle. One who's busy but not productive may have training gaps.
2. Add or Expand Profitable Services and Ancillaries
When exploring new services or ancillaries, answer three questions: Does it improve care for existing patients? What's required to launch? Do you have enough patient volume to justify the investment?
A well-chosen ancillary can significantly boost EBITDA while offering more services under one roof. It also becomes a major multiplier on your practice's value — patients are happier, more likely to refer friends, and more willing to stay under your care.
3. Open New Locations (But Only After Maximizing the First)
Before deciding to open another location, check if you're truly maxed out. Could you still grow patient volume at your current site with better marketing or increased insurance-network reach? Plan who will manage the new location without hurting the first.
We find that expanding from one to two locations is often the hardest step. Once you prove the model with a second site, replicating success for a third becomes easier.