Texas Physician Practice
Sale Attorney.
Deliberate legal counsel for Texas physicians, dentists, veterinarians, optometrists, and other healthcare professionals selling, acquiring, affiliating, or planning the succession of a professional practice. Lone Star Counsel coordinates the transaction, the healthcare-regulatory framework, the tax structure, and the payor-credentialing transition under one attorney-CPA roof.
A Texas physician practice sale is not a standard business acquisition. The corporate-practice-of-medicine doctrine controls the ownership structure. The Stark law and the federal anti-kickback statute constrain every element of the compensation stack. Fair-market-value support is required, not optional. Payor credentialing takes months and cannot be compressed. Physician non-competes are governed by their own Texas statute. And the professional entity itself must remain physician-owned — no exception, no workaround.
Lone Star Counsel represents Texas physicians, dentists, veterinarians, optometrists, chiropractors, and other licensed healthcare professionals in every phase of a practice transition: full asset sales, MSO transactions with private equity or hospital systems, partial equity sales, partner buyouts, de novo affiliations, and multi-generational family-practice succession. Led by Darryl V. Pratt, Esq., CPA, the firm brings the legal, tax, and healthcare-regulatory disciplines under a single engagement.
The value of a physician's life work is decided in the ninety days before signing — not in the ninety days after.
Four Transaction Structures for a Texas Practice.
The right structure depends on who the buyer is, what the physician wants after closing, the payor mix, the referral profile, and the tax objectives of both sides. Lone Star Counsel evaluates each of the four principal structures against those variables:
Full Asset Sale
The buyer's professional entity (or MSO plus professional entity) acquires the non-clinical assets. The seller-physician exits after a transition period, typically 6–24 months as a W-2 employee.
MSO Transaction
A private-equity, physician-network, or hospital-affiliated MSO acquires the non-clinical assets and manages operations. The physician-owned professional entity remains and retains clinical decisions. Often paired with physician-equity rollover into the MSO.
Partial Sale / Equity Rollover
The physician sells a controlling interest but retains meaningful equity — a "second bite of the apple" structure common in private-equity roll-ups. Requires careful documentation of the retained equity's terms and future liquidity path.
Internal Partner Succession
The retiring physician sells to existing physician partners — often over 5–10 years — through a coordinated buy-sell, funded by life insurance, group credit facility, or seller-financed installment. Preserves practice continuity and physician ownership.
Six rules govern every Texas physician transaction.
Standard M&A practice cannot be layered onto a healthcare transaction without adjustment. Six regulatory disciplines — three federal, three Texas-specific — control the structure:
- Corporate practice of medicine (Texas)
Non-physicians cannot own the professional entity or employ physicians to practice medicine. Every buyer structure must respect this rule.
- Stark law (federal)
42 U.S.C. §1395nn — strict-liability prohibition on physician self-referral for designated health services with Medicare/Medicaid patients. Every financial relationship must fit an exception.
- Anti-kickback statute (federal)
42 U.S.C. §1320a-7b — intent-based prohibition on remuneration inducing federal-healthcare-program referrals. Fair-market-value documentation is essential.
- Texas Business & Commerce Code §15.50(b) (physician non-competes)
Specific Texas rules for enforceability of physician non-competes — buy-out provision, patient-list access, and continuity-of-care requirements are mandatory.
- HIPAA and Texas Medical Records Privacy Act
Patient-record transfer, business-associate agreements, and patient-notification requirements govern every practice transition.
- Payor credentialing (Medicare, Medicaid, commercial)
Not law strictly, but a critical-path operational reality — credentialing cannot begin before the acquiring entity has a tax ID, cannot conclude before closing without payor cooperation, and drives 60–120 days of post-closing cash-flow risk.
Ten instruments that carry a Texas physician sale.
A complete Texas physician-practice transaction is a coordinated document set — not a single agreement. The document family typically includes:
Corporate practice of medicine
Texas's rule that non-physicians cannot own a professional medical entity or employ physicians to practice medicine. The rule shapes every physician-practice transaction structure in the state.
Management-services organization (MSO)
The buyer-owned entity that acquires the non-clinical assets and provides administrative services to the physician-owned professional entity under a long-term management-services agreement.
Stark law
42 U.S.C. §1395nn — prohibits physicians from referring Medicare or Medicaid patients for designated health services to entities with which they have a financial relationship, absent a statutory exception.
Anti-kickback statute
42 U.S.C. §1320a-7b — prohibits remuneration to induce federal-healthcare-program referrals. Applies to every element of a transaction with a referral component.
Fair-market-value opinion
The written valuation opinion that supports the price, MSO fees, and lease rates against Stark and anti-kickback scrutiny.
Texas §15.50(b) — physician non-compete
The Texas statute governing enforceability of non-competes against physicians, with specific requirements including a buy-out provision and continuity-of-care rules.
Payor credentialing
The process by which each payor (Medicare, Medicaid, commercial insurers) recognizes the acquiring entity's tax ID and pays claims — typically 60–120 days after application.
DEA and CLIA registrations
Facility-level registrations that require re-issuance in the buyer entity's name; timing coordination is critical to avoid controlled-substance or laboratory service gaps at closing.
Personal goodwill vs. enterprise goodwill
For C-corp practices, the allocation of value between the physician's personal goodwill (owned individually) and the entity's enterprise goodwill can materially reduce the seller's tax result.
Section 1060 allocation
The IRS-required allocation of purchase price across seven asset classes — negotiated in the APA and reported by both parties on Form 8594.
Six steps, measured against the credentialing clock.
- 01.
Discovery & Structure Conference
We identify the physician's goals — retirement, partial exit, hospital affiliation, private-equity partnership, family transition — and select the structure that fits: full sale, MSO, partial sale, or de novo affiliation.
- 02.
Regulatory Framework
We coordinate the Stark and anti-kickback analysis, fair-market-value support, corporate-practice-of-medicine structure, and payor-credentialing pathway that will govern the transaction.
- 03.
LOI & Definitive Agreement Drafting
We prepare or negotiate the Letter of Intent, then draft the Asset Purchase Agreement (or MSO agreement package) with the healthcare-specific representations, restrictive covenants, and closing conditions the transaction requires.
- 04.
Diligence, Licensing & Credentialing
We coordinate legal, financial, tax, and regulatory diligence; prepare license and DEA transfer applications; initiate payor credentialing in the acquiring entity's name; and manage patient-notification requirements.
- 05.
Employment & Restrictive Covenants
We draft physician employment agreements with §15.50(b)-compliant non-competes, non-solicits, and compensation formulas that survive Stark and anti-kickback scrutiny.
- 06.
Closing & Post-Closing Transition
We execute the closing, coordinate the transition of records, staff, credentialing, and facility licenses, and support the buyer and seller through the 60–120-day post-closing period until payor credentialing completes.
The numbers behind the medical practice.
Physician-practice transactions sit at the intersection of business law, healthcare regulation, tax planning, valuation, insurance, and estate planning. As a dually licensed Texas attorney and Certified Public Accountant, Darryl V. Pratt is positioned to coordinate the legal terms, the tax structure, and the financial modeling in a single engagement — while working alongside the client's independent CPA, healthcare-regulatory specialist, and financial advisor.
A Practice Sale Never Stands Alone.
The physician's practice is usually the largest asset in the retirement plan. The transaction must be coordinated with the surrounding disciplines so the sale, the tax treatment, the retirement structure, and the estate plan describe the same event.
Why Choose Lone Star Counsel?
- Nearly 30 years of combined legal and financial experience from a Texas attorney and CPA.
- Focused counsel for Texas physician-practice sales, MSO transactions, partner successions, and healthcare M&A — with corporate-practice-of-medicine, Stark, and anti-kickback structuring under one engagement.
- Deliberate representation of Texas physicians, dentists, veterinarians, optometrists, chiropractors, and multi-specialty groups.
- Coordinated planning that treats the practice sale as a life-decision — not just a transaction — with the tax, retirement, and estate integration the physician's family deserves.
- Attorney-CPA perspective that matters most at the moment goodwill is allocated, receivables are valued, and the earn-out formula is negotiated.
Answers before the transition.
Schedule a Practice Transition Conference.
Whether you are five years from retirement, considering a private-equity or hospital affiliation, planning an internal partner succession, or acquiring a practice, Lone Star Counsel can help you plan and execute the transaction that fits your practice, your family, and your timeline.
(972) 712-1515
2591 Dallas Parkway, Suite 300, Frisco, Texas 75034
Serving physicians, dentists, veterinarians, and healthcare professionals throughout Texas.