IMA Financial Group does much more than employee benefits, insurance consulting, and risk management, they partner with the Michigan State Medical Society and its’ members to support their Mergers and Acquisitions (M&A) and buy/sell transaction needs from contemplation, to planning and through execution.
The pace of physician practice mergers and acquisitions (M&A) has remained steady through 2025 and into early 2026, driven by persistent economic pressures, workforce shortages, and the shift toward value‑based care. Recent analyses highlight that consolidation continues even amid caution from buyers, as practices grapple with rising administrative burdens, increasing reimbursement pressure, and the need for capital to modernize operations. Independent practices in particular face mounting challenges - from inflation and labor costs to competition from health systems, private equity platforms, and payers - prompting many to explore partnerships or outright acquisition as a means to preserve long‑term viability.
In 2024 and 2025, M&A activity remained highly active across key specialties such as internal medicine, cardiology, orthopedics, and dental services, with strategic buyers continuing to dominate deal flow even in a high‑interest‑rate environment. Market reports show that although deal volume softened slightly in certain segments, total deal value rose significantly in early 2025 – up 56 percent compared to the prior half‑year – reflecting a shift toward larger, more strategic transactions that offer scale, operational efficiency, and stronger financial footing. At the same time, regulatory scrutiny and state oversight of healthcare transactions have increased, adding additional complexity to the transaction lifecycle and elevating the importance of thorough pre‑closing risk assessment.
As consolidation accelerates, physician owners contemplating a sale or partnership are faced with an environment where misunderstandings about financial performance, reimbursement trends, revenue cycle reliability, or liability exposure can lead to valuation gaps, renegotiations, or even failed deals. This is where third‑party financial due diligence has become not merely advisable, but essential.
Healthcare M&A specialists deliver objective, comprehensive financial due diligence tailored specifically to physician practices, multispecialty groups, and management services organizations.
Independent diligence is crucial for several reasons:
Clarifying True Earnings and Quality of Revenue
Many physician practices experience volatility in collections, payer mix, charge capture, and coding integrity. Without a rigorous analysis of normalized earnings and sustainable cash flow, deal valuations may be materially off base. Market research shows that financial distress or reimbursement variability influenced more than 40 percent of provider‑side M&A transactions in 2025, underscoring the need for clear visibility into financial fundamentals before closing.
Identifying Operational Risks and Cost Structure Realities
As inflation and rising labor costs continue to squeeze margins across the healthcare sector, a detailed cost review helps identify post‑transaction efficiency opportunities. This is critical for buyers and helps sellers prepare for scrutiny and defend value. Studies note that staffing challenges and administrative burdens remain among the most significant pressures driving physicians toward employment or partnership models.
Supporting Smoother Negotiations and Faster Closings
Well‑prepared diligence packages reduce uncertainty for buyers, mitigate renegotiation risk, and help both sides align on deal structure earlier in the process.
Enhancing Long‑Term Success of the Partnership
Comprehensive diligence helps ensure that expectations around profitability, investment needs, and future operational performance are realistic, laying a stronger foundation for integration.
As physician practice consolidation continues in 2026, those considering a sale, acquisition, or strategic partnership are encouraged to engage a third-party diligence partner early in the process. Their expertise helps protect your practice, preserve value, and support successful transitions in an increasingly complex and fast‑moving healthcare landscape.
Your next strategic move deserves expert guidance. IMA’s healthcare M&A diligence team brings deep industry insight and decades of hands‑on experience to every engagement. See how we can support your practice at www.imadiligence.com or reach out directly, dan.kohanzo@imacorp.com.