Explore Medical Practice Acquisition and Sale in Tennessee

The most active buyers right now are hospitals and health systems, physician groups backed by private equity, Federally Qualified Health Centers (FQHCs) and individual physicians who want to own a practice.

Tennessee has 29 federally funded health center organizations (HRSA, 2025), and about 52% of people on Medicare in the state are in Medicare Advantage or other private plans (KFF, 2024). That makes groups focused on value-based care especially interested in primary care practices with many senior patients. Because Tennessee limits ownership of medical practices to licensed physicians, investor-backed buyers usually work through a management company that partners with a physician-owned practice.

We can tell you which buyer types are most active for your specialty and location.

Generally no. Tennessee does not allow unlicensed people or companies to directly employ physicians unless a law allows it, but the exceptions are broad: hospitals and their affiliates, physician-owned professional corporations, nonprofit clinics, FQHCs, rural health clinics, community mental health centers and others. Physicians use a medical professional corporation or medical PLLC, and physician assistants may co-own these with physicians.

What changed recently: since July 1, 2025, hospitals in counties of 105,000 people or fewer may employ physicians in all specialties (HB 979). Rules like these change often, so have a health care attorney review the deal structure.

Most practices are valued on their adjusted yearly profit, often called EBITDA or seller's discretionary earnings, times a multiple. The multiple goes up with steady revenue, a loyal patient base, providers and staff who will stay, clean financial records and a practice that does not depend only on you. It goes down with heavy reliance on one payer, falling patient numbers or a short lease.

In Tennessee, Medicaid (TennCare) runs entirely through managed care plans, so your mix of Medicaid, Medicare and commercial patients and the plans you contract with weigh heavily in the price. The state has 169 primary care shortage areas, and practices that serve these communities often draw strong buyer interest because patients have few other options.

A confidential valuation is the best way to see where your practice stands.

All three can work, and the right choice depends on your goals and the buyer. Selling the building with the practice gives you one clean exit and more cash at closing, but some buyers cannot finance both. Leasing it to the buyer gives you steady income and often makes the practice easier to sell, as long as the rent and terms are at market rate and the lease is long enough for the buyer's lender. Keeping the building and leasing it to someone else is also an option if you want to hold it as an investment.

Tennessee has no state personal income tax, so a building sale is not hit by a state income tax, though federal capital gains tax still applies. We help you compare the options with your CPA before the practice goes to market.

Usually yes. Under Tennessee law, a health care non-compete in a signed writing is treated as reasonable if it lasts 2 years or less and covers a 10-mile radius or the county of the main practice site, whichever is greater. Emergency physicians are not covered by these rules.

For the sale of a practice, the agreed time and area only need to be reasonable and are presumed reasonable. Your attorney should review the terms before you sign.

Tennessee requires records to be kept at least 10 years from the last professional contact, and for minors at least one year after they reach adulthood if that is longer.

When you retire or sell, patients seen in the prior 36 months must be notified within 30 days, and in a sale the records must go to a physician or entity bound by the same confidentiality rules. We make sure the records transfer is written into the purchase agreement.