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Selling a Dental or Medical Practice in Texas: Valuation, Buyers and What to Prepare
By Josh Campbell, Business Broker · First Choice Business Brokers Dallas Metro · Updated October 2026
Who can own a practice in Texas
Texas generally restricts ownership of dental and medical practices to licensed professionals. This is known as the corporate practice of dentistry and medicine doctrine. As a result:
- Individual buyers are typically licensed dentists or physicians
- DSOs and private equity usually acquire through a management services organization (MSO) structure, where a licensed professional owns the clinical entity and the MSO handles the business side
A healthcare attorney should review any structure before closing.
What drives practice valuation
| Factor | Raises value | Lowers value |
|---|---|---|
| Collections and profit | Steady or growing, documented | Declining or volatile |
| Active patients | Large, active base with good recall | Shrinking patient base |
| New patients | Steady new patient flow | Few new patients |
| Payer mix | Fee-for-service or strong PPO rates, diversified | Heavy reliance on low-paying plans or Medicaid |
| Hygiene and ancillary revenue | Strong hygiene program, in-house ancillaries | Doctor production carries everything |
| Doctor dependence | Associate providers in place | Selling doctor produces nearly all revenue |
| Staff | Experienced, stable team | Turnover |
| Facility and equipment | Modern equipment, digital records, room to grow | Outdated equipment, space constraints |
| Lease | Long, transferable lease or owned real estate | Short lease |
How practice deals are structured
- Doctor-to-doctor sale: often financed by specialty healthcare lenders; the selling doctor may stay for a short transition
- DSO or private equity sale: usually includes cash at closing, sometimes equity rollover, and a multi-year employment agreement for the selling doctor
- Associate buy-in or buyout: an internal successor buys over time
The right path depends on your goals: retire soon, keep practicing, or maximize value with ongoing upside.
Regulatory items buyers will check
- Licenses: the buyer must hold an active Texas license from the appropriate board
- Patient records: transfer and custody must comply with HIPAA and Texas rules
- Insurance credentialing: the buyer must be credentialed with payers, which takes time
- DEA and controlled substance registrations, where applicable
- Compliance history: billing, coding and board complaints
Who buys dental and medical practices
- Individual dentists or physicians: often first-time owners or associates
- DSOs and medical groups: expanding into DFW and Texas markets
- Private equity backed platforms: through compliant MSO structures
- Hospital systems: for some medical specialties
How to prepare your practice for sale
- Track collections, production, profit and new patients monthly.
- Strengthen your hygiene or ancillary programs.
- Bring on an associate to reduce dependence on the selling doctor.
- Review payer contracts and fee schedules.
- Secure or extend your lease, or decide about owned real estate.
- Organize compliance, credentialing and records documentation.
- Clean up your financials and document your add-backs.
Josh's take: Practice buyers know patients follow the doctor more than the sign out front. That's why the transition plan matters so much, and why DSOs usually want you to stay on for a while. Texas corporate practice rules shape how the deal gets structured, so bring a healthcare attorney in early, and plan on credentialing taking longer than anyone promises.
Frequently asked questions
What is my dental practice worth?
Smaller practices are often valued at about 60 to 80% of annual collections, while larger DSO-ready practices can bring 4 to 8 times EBITDA or more.
Can a non-dentist or non-physician buy my practice?
Generally not directly in Texas. DSOs and investors typically use management services organization structures with a licensed professional owner.
Will I have to keep working after the sale?
In a DSO sale, often yes, for a set period. In a doctor-to-doctor sale, transitions are usually shorter.
How long does credentialing take for the buyer?
Often several months, so start early to avoid gaps in insurance payments.
This page is general information, not legal advice. Talk with a healthcare attorney about ownership rules and deal structure for your practice.