How to Extract Yourself from Private Practice and Transition Into Employment: A Step‑by‑Step Guide for Physicians

By Bruce G. Krider, MHA, American Healthcare Appraisal

Introduction: When the Road You’re On Stops Feeling Like Home

There comes a moment in many physicians’ lives when the private practice they built with grit, sacrifice, and more late‑night charting than any human should endure… starts to feel less like a calling and more like a burden. Reimbursement cuts keep coming. Staffing shortages never end. And the business side of medicine—well, it’s become a second full‑time job.

If you’re thinking about leaving private practice, you’re not alone. Thousands of physicians are quietly searching phrases like “How do I sell my medical practice?”, “physician exit strategy,” and “medical practice valuation.” This guide is here to walk you through the process—step by step, calmly, clearly, and with a little humor to make the journey easier.

Worthwhile Words:

“The moment you think you’ll ‘figure it out later’… that’s the moment later starts sprinting toward you.”

PART ONE: DECIDING TO LEAVE PRIVATE PRACTICE

Step 1 — Confirming That You’re Ready to Exit

Leaving private practice isn’t just a financial decision—it’s an emotional one. For many physicians, the practice is part of their identity. But when the administrative load outweighs the joy of patient care, it may be time to consider a transition.

Recognize the signs.

If you’re spending more time managing staff, negotiating payer contracts, or fighting denials than practicing medicine, that’s a signal. When the business consumes the healer, something needs to change. Take a quiet moment to list what drains you most — the pattern will reveal itself.

Understand what you’re giving up—and what you’re gaining.

You may lose some autonomy, but you gain stability, predictable income, and the ability to focus on patient care again. Employment can feel like stepping out of a storm and into a warm, well‑lit room. Write down what matters most to you now — your priorities may have shifted.

Differentiate between selling, winding down, and merging.

Each path has different implications for your income, your patients, and your future. Understanding the differences early helps you choose wisely. A short conversation with an appraiser or healthcare attorney can clarify which path fits your situation.

Worthwhile Words:

“Burnout doesn’t mean you’re broken. It means you’ve been carrying too much for too long.”

PART TWO: PREPARING YOUR PRACTICE FOR EXIT

Step 2 — Quietly Getting Your House in Order

Before you tell anyone—staff, partners, or even your spouse’s chatty cousin—you need to prepare your practice for a potential sale, merger, or wind‑down. This is where physician practice appraisal and medical practice valuation begin.

Gather 3–5 years of financial statements.

Buyers want to see trends, not snapshots. Clean, organized financials make your practice more attractive and increase confidence in your valuation. If your books are messy, hire a bookkeeper for a quick cleanup — it pays for itself.

Review payer contracts, vendor agreements, and leases.

These documents reveal obligations, renewal dates, and potential liabilities. A buyer will scrutinize them, so you should too. Create a simple spreadsheet listing each contract, its expiration date, and any termination clauses.

Understand your malpractice tail coverage.

Tail insurance can be expensive and must be factored into your exit strategy. Knowing your obligations early prevents unpleasant surprises. Call your carrier and ask for a written quote — don’t rely on assumptions.

Assess accounts receivable and run‑off revenue.

Your A/R is part of your practice’s value. Understanding how much is collectible — and how quickly — helps determine your true financial position. Print an aging report and highlight anything over 90 days; that’s where most surprises hide.

Identify compliance or billing risks.

Even small issues can scare off buyers or reduce your valuation. Addressing them early protects your negotiating position. A quick internal audit or outside review can uncover problems before a buyer does.

Worthwhile Words:

“A messy file cabinet has ruined more deals than a bad handshake.”

Step 3 — Choosing Your Exit Path

There are only three real ways out of private practice, and each one affects your practice appraisal, your income, and your future.

Selling the practice.

Selling can be clean and profitable — if your practice is well‑run and financially stable. Buyers may include hospitals, private equity groups, or other physicians. Start by identifying who is actively acquiring in your specialty and region.

Winding down the practice.

Sometimes the simplest path is to close the doors, sell the assets, and manage the run‑off revenue. This option works best when the practice has limited market value or when the physician wants a clean break. Make a timeline for closing, including patient notifications and record transfers.

Merging into a larger group.

Merging allows you to maintain continuity of care while shedding administrative burdens. Larger groups often have better payer contracts, stronger infrastructure, and more predictable income. Reach out discreetly to groups you respect and ask whether they’re open to discussions.

Worthwhile Words:

“The first offer is like the first pancake—rarely the one you want to serve.”

Step 4 — Getting a Realistic Appraisal

This is where your expertise shines, Bruce. Physicians often overestimate the value of their practice because they’re emotionally attached. But medical practice valuation is based on objective factors.

Buyers care about future earnings, not past glory.

A full waiting room in 2018 doesn’t matter if reimbursement has dropped and staffing costs have risen. Buyers want to know what the practice will earn after they take over. Prepare a simple projection of next year’s revenue and expenses — it helps anchor expectations.

Goodwill is limited in today’s market.

Most buyers won’t pay for “reputation” unless it’s tied to recurring revenue or specialty dominance. Emotional value doesn’t translate into financial value. Focus on tangible assets and sustainable earnings instead.

EBITDA multiples for small practices are modest.

Private equity pays high multiples for large groups — not solo or small practices. Understanding this prevents disappointment and helps you negotiate realistically. Ask your appraiser for comparable transactions in your specialty.

Payer mix and reimbursement trends matter.

A Medicare‑heavy practice will be valued differently than a commercial‑dominant one. Buyers analyze risk, not nostalgia. Print your payer mix report and highlight any shifts over the last three years.

Worthwhile Words:

“Hope is not a valuation method.”

PART THREE: EXECUTING THE TRANSITION

Step 5 — Preparing for the Transition

Once you’ve chosen your path, it’s time to execute with precision.

Notify staff at the right time.

Too early creates panic; too late creates resentment. Timing is a delicate art. Draft your communication plan before you speak to anyone — it keeps emotions from steering the conversation.

Communicate clearly with patients.

Patients appreciate transparency, and proper communication reduces confusion and complaints. Provide written instructions about where you’re going and how they can continue care. Keep the message simple and reassuring.

Handle medical records properly.

HIPAA doesn’t take a vacation just because you’re transitioning. Ensure you follow state rules for retention and transfer. Create a checklist so nothing slips through the cracks.

Manage accounts receivable.

Decide whether you’ll collect A/R yourself or sell it as part of the transaction. Each option has pros and cons. Review your aging report to estimate how much you’re likely to collect.

Ensure compliance with state and federal rules.

Every state has its own requirements for closing or transferring a medical practice. Missing a step can create legal headaches. Check your state medical board’s website for a closure checklist.

Worthwhile Words:

“If you think communication is expensive, try miscommunication.”

PART FOUR: FINDING YOUR NEXT OPPORTUNITY

Step 6 — Where to Start Your Job Search

This is where many physicians feel lost. But the path is clearer than it seems.

Start with your network.

Your colleagues know your reputation and your strengths. They often know about opportunities before they’re posted. Send a few discreet messages letting trusted peers know you’re exploring options.

Contact hospital systems directly.

Hospitals have internal recruiters and unadvertised openings. A direct inquiry can bypass the noise. Visit their careers page and send a short, professional email to the physician recruitment team.

Use physician recruiters strategically.

Recruiters can be helpful, but remember: they work for the employer. Use them as a resource, not a guide. Ask them which organizations they represent — transparency matters.

Explore national job boards.

Sites like NEJM CareerCenter, Doximity, and PracticeLink offer thousands of listings. They’re a good way to understand market trends. Set up alerts so opportunities come to you.

Consider locums as a bridge.

Locums can provide income and flexibility while you explore long‑term options. It’s also a low‑risk way to test different practice settings. Start with a short assignment to see what fits.

Worthwhile Words:

“If a recruiter calls you three times in one day… someone, somewhere, is desperate.”

PART FIVE: SECURING THE RIGHT POSITION

Step 7 — Evaluating Employment Offers

Employment contracts can be confusing, but understanding the key components makes comparison easier.

Base salary vs. wRVU compensation.

Know how productivity affects your income. Some models reward efficiency; others punish it. Ask for sample compensation reports from current physicians.

Quality incentives.

These bonuses can be meaningful — or meaningless. Understand how they’re measured. Request the actual metrics and historical payout data.

Call coverage expectations.

A high salary can hide a brutal call schedule. Ask for the call rotation in writing. Speak with current physicians to confirm reality matches the contract.

Non‑compete clauses.

These can limit your future options. Read them carefully. Ask an attorney to review the language before you sign.

Signing bonuses and relocation.

These are negotiable and often flexible. Don’t accept the first offer. Ask whether bonuses can be tied to milestones instead of time.

Tail coverage.

This can cost tens of thousands of dollars. Know who pays. Request a written estimate from your malpractice carrier.

Worthwhile Words:

“The devil doesn’t hide in the details. He lives there.”

Step 8 — Negotiating Your Contract

Negotiation isn’t confrontation—it’s communication.

Know what’s negotiable.

Salary, call burden, start date, bonuses, and tail coverage are often flexible. Don’t assume the first draft is final. Ask respectfully and clearly for what you need.

Know what’s not.

Stark Law, Medicare rules, and hospital policy are immovable. Don’t waste energy trying to change them. Focus your negotiation where you have leverage.

Approach negotiation calmly.

Hospitals expect it. You’re not being difficult — you’re being professional. Prepare your priorities in advance so you negotiate with clarity.

Worthwhile Words:

“Closed mouths don’t get better contracts.”

PART SIX: LANDING WELL

Step 9 — Planning Your First 90 Days

Your first 90 days set the tone for your new career chapter.

Credentialing takes time.

Start early to avoid delays. Missing paperwork can push your start date back by months. Keep a folder with every required document ready to go.

EMR training is essential.

Mastering the system improves efficiency and reduces frustration. Don’t skip training sessions — they save time later. Ask for a “super‑user” mentor.

Meet key leaders.

Relationships matter in employed settings. Introduce yourself to department chairs, nursing leaders, and administrative staff. These early connections make your transition smoother.

Understand productivity expectations.

Clarity prevents misunderstandings. Ask for written benchmarks and examples. Review them monthly during your first quarter.

Build early patient volume.

A strong start leads to long‑term stability. Work with scheduling to open slots early. Introduce yourself to referring physicians.

Worthwhile Words:

“The first 90 days aren’t about proving yourself—they’re about learning the rhythm of your new world.”

Conclusion: A New Chapter, Not an Ending

Leaving private practice isn’t failure—it’s evolution. And with the right guidance, the transition can be smooth, strategic, and even liberating.

Use the Editable AI Prompt Below to Create Your Personalized Transition Plan

If you’d like to use the editable version of the AI prompt — where you can fill in your details, tailor the questions to your specialty, and generate personalized guidance — you can access it directly on my website.

Customizable AI Prompt (Copy & Paste)

The following is an AI prompt which is meant to be pasted into an AI platform, ie. ChatGPT or Co-pilot for example. 

Once you fill in your practice details at the bottom of the page, copy everything and paste it into AI for advice on all the points we have added below plus the information you have added where it says “INSERT YOUR PRACTICE DETAILS HERE” This will give you good advance on a plan forward.

I am a physician preparing to transition out of private practice.

I need guidance tailored to my specialty, my practice size, and my goals.

Please help me with the following:

1. Evaluate my current practice situation and identify the best exit strategy

   (selling, merging, or winding down).

2. Provide a checklist of what I need to prepare before approaching buyers or employers.

3. Suggest employment opportunities based on my specialty and geographic preferences.

4. Help me evaluate job offers, including compensation models, call schedules,

   non-competes, and tail coverage.

5. Provide negotiation strategies tailored to my situation.

6. Outline a 90-day plan for transitioning into an employed role. 

Here is my background and current situation: [INSERT YOUR PRACTICE DETAILS HERE].

Have Questions?

If you’d like to discuss your situation, explore your options, I’m always glad to help.

Phone: 760‑612-9156
Email: bgkrider@ahca.com

You’re not alone in this transition — and you don’t have to navigate it without a guide.