How Private Equity Is Buying Up Physical Therapy Clinics

Episode notes

Private equity has been quietly rolling up physical therapy practices across the US for over a decade, and the pace has accelerated sharply since 2020. In this episode, Lucas and Luna trace the consolidation playbook: from the rise of platform companies like Athletico and Confluent Health to the 'buy-and-build' strategy of tucking in independent clinics. They break down the economics that make physical therapy so attractive - high margins, recurring demand, and a fragmented market of over 30,000 small practices - and examine the trade-offs for patients and clinicians. With roughly 25 percent of clinics now backed by private equity, the conversation touches on how consolidation affects referral networks, insurance negotiations, and clinical autonomy. Lucas walks through a typical deal structure: how a platform raises at, say, eight times EBITDA, does smaller bolt-on acquisitions at six times, and creates value through overhead reduction and expanded payer contracts. Luna pushes back on whether bigger is actually better for patient outcomes, citing studies that suggest corporatized settings may over-treat.

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