What Is My Dermatology Practice Business Worth in 2026?

Dermatology practices are selling for 6.0x-12.0x EBITDA in 2026, with top-performing practices that combine medical stability with cosmetic growth clearing at 8x-12x EBITDA and mature regional platforms reaching 12x-15x. Single-physician practices typically trade at 3x-5x EBITDA, small group practices at 4x-7x, and multi-provider platforms with strong Mohs, MDS, and cosmetic revenue at 8x+. Active buyers include Epiphany Dermatology, Advanced Dermatology & Cosmetic Surgery, US Dermatology Partners, Forefront Dermatology, Schweiger Dermatology Group, and PE-backed platforms across the consolidation landscape.

Who this is for: Owners of medical dermatology practices, Mohs and skin cancer surgery practices, cosmetic dermatology groups, and multi-provider dermatology platforms generating at least $500K in EBITDA who are considering a sale in the next 12-24 months.

How Is a Dermatology Practice Valued?

Valuation comes down to adjusted EBITDA multiplied by a market multiple, with working capital and closing adjustments layered in. The EBITDA recast is where most of the negotiation happens. Physician compensation gets normalized to market — buyers apply a fair-market-value salary to each working physician and add back the difference. Non-recurring items, related-party rent, owner personal expenses, and one-time legal or consulting fees all come out. In my experience, a clean recast typically adds 20-35% to stated EBITDA for owner-operated dermatology practices.

What makes dermatology unique is the revenue mix scrutiny. Buyers underwrite medical dermatology, Mohs/surgical, and cosmetic as three separate businesses inside one P&L. Medical derm revenue gets the most credit because it's insurance-reimbursed and durable. Mohs surgery revenue earns premium pricing because of high margins and demand. Cosmetic revenue is prized for growth but gets less multiple because it's discretionary and cyclical. The best-priced practices have roughly 50-60% medical, 20-30% Mohs/surgical, and 15-25% cosmetic — which is why diversified dermatology practices outearn single-service operators almost every time.

What Are Current Dermatology Practice Valuation Multiples?

In 2026, the market is stratified by size and quality. Single-physician practices with $200K-$500K EBITDA trade at 3x-5x and typically sell to local strategic acquirers or owner-operator buyers. Small group practices with $500K-$1.5M EBITDA are in the 4x-7x range. Multi-provider practices generating $1.5M-$5M EBITDA with diversified medical/surgical/cosmetic revenue hit 8x-12x. Regional platforms above $5M EBITDA with multiple locations, recruited associates, and scalable infrastructure reach 12x-15x.

Mohs-heavy practices earn premium multiples because Mohs revenue is high-margin and supply-constrained. Cosmetic-heavy practices get discounted relative to medical-heavy ones because consumer discretionary revenue is less durable through recessions. Practices with recruited associates (non-owner physicians generating billable revenue) scale cleanly for a buyer and command 1-2 turns above owner-dependent practices of the same size.

Who's Buying Dermatology Practices in 2026?

The buyer pool is deep and experienced. Epiphany Dermatology leads the market with 39 announced deals over the past five years, making it the most active platform consolidator. Advanced Dermatology & Cosmetic Surgery (ADCS), US Dermatology Partners, Forefront Dermatology, Schweiger Dermatology Group, Pinnacle Dermatology, DOCS Dermatology, and Dermatologists of Central States round out the strategic acquirer list. On the PE side, LGP Capital, Harvest Partners, Morgan Stanley Capital Partners, New MainStream Capital, and Audax Group have active dermatology platforms.

Q1 2026 physician practice deals have concentrated in dermatology, cardiology, and orthopedics — reflecting continued PE capital availability for high-margin specialties. Dermatology remains attractive to buyers because of recurring patient base (skin cancer screenings, chronic eczema/psoriasis, acne), premium insurance reimbursement, cosmetic upside, and strong patient loyalty. Adjacent specialties like optometry platform acquirers are watching dermatology's rollup playbook because the unit economics and consolidation logic are nearly identical.

What Makes a Dermatology Practice Worth More?

Multiple expansion comes from a short list of factors. First, revenue mix — practices with a healthy balance of medical, Mohs/surgical, and cosmetic consistently outperform single-service practices in valuation. Second, physician leverage — when non-owner providers generate the majority of billable revenue, the practice scales without the owner and commands premium pricing. Third, Mohs capability — having a fellowship-trained Mohs surgeon in-house typically adds a multiple turn because Mohs is a high-margin, insurance-reimbursed service with structural demand.

Fourth, cosmetic infrastructure — a well-built cosmetic business with neurotoxins, fillers, lasers, body contouring, and a trained aesthetician team is a growth asset buyers pay up for, especially one with recurring loyalty memberships. Fifth, EHR and revenue cycle — clean data exports from Modmd, Nextech, EMA, or EZDerm, strong days-in-AR, and clean payor credentialing files all reduce buyer risk. Sixth, contracts and credentialing — in-network status with major commercial payors and clean Medicare/Medicaid participation histories are baseline requirements.

What Hurts Dermatology Practice Valuations?

A few things cut multiples hard. Owner-physician dependency is the biggest — if the founder generates more than 40% of medical billings, buyers either walk or structure a multi-year earnout. Concentrated cosmetic revenue (cosmetic more than 50% of total) introduces cyclical risk and gets discounted. Heavy reliance on a single referral source (one primary care group, one hospital system) creates single-point-of-failure risk that kills deals.

Poor documentation, failed OIG audits, any Mohs utilization anomalies, or patterns of high modifier-25 billing all trigger extra diligence and usually a price reduction. Owner-sublet real estate at above-market rent is a red flag for buyers because it signals hidden compensation. Finally, locums-heavy staffing, unfilled physician positions, and poor mid-level leverage (PAs and NPs underutilized) all suggest operational fragility and reduce multiples.

How Long Does It Take to Sell a Dermatology Practice?

Typical timeline from engagement to close is 6-12 months. Preparation and CIM build runs 4-6 weeks. Go-to-market with buyer outreach runs 6-10 weeks. LOI negotiation is 2-4 weeks. Due diligence is the long phase for dermatology — 75-120 days given Mohs utilization scrutiny, payor credentialing review, physician employment diligence, and quality-of-earnings work. Closing documentation runs another 30-45 days. The practices that close fastest are the ones with clean EHR data, documented Mohs utilization patterns, and physician employment agreements with post-transaction non-competes already in place.

"Dermatology is the highest-multiple specialty I work in consistently. A practice I sold last year — $2.3M EBITDA, three physicians including a Mohs surgeon, 55% medical / 25% Mohs / 20% cosmetic split, strong BCBS and Anthem contracts — ran a competitive process with eight LOIs and closed at 10.8x. The owner had spent two years building cosmetic revenue and recruiting a non-owner associate. That preparation added about $6M to the enterprise value. Dermatology sellers who plan their exit two to three years out always out-earn the ones who decide to sell on a Tuesday."

— John M. Salony, Business Broker