Roll Ups in Healthcare: The Hottest Trend Reshaping the Industry

Roll Ups in Healthcare by Dr. Allen Nazeri DDS MBA CM&AP

Consolidation has become the name of the game across multiple sectors, and healthcare is no exception. In recent years, “Roll Ups in Healthcare” have emerged as one of the most aggressive growth strategies deployed by private equity firms, strategic buyers, and entrepreneurial operators looking to scale quickly, gain market power, and command higher valuation multiples. From dental labs and dermatology clinics to behavioral health, home health, and veterinary services; roll-up activity is booming.

In this article, we’ll examine the drivers behind this trend, break down its pros and cons, and highlight key geographic hotspots and notable buyers behind the most significant roll-ups currently underway.

Roll Ups in Healthcare: What’s Driving the Surge?

The concept of roll-ups isn’t new, but its rapid acceleration in healthcare post-COVID is driven by a unique confluence of economic, regulatory, and structural factors.

1. Highly Fragmented Market

Most healthcare verticals, especially in the outpatient and ancillary services sector—remain fragmented, often dominated by small to midsize independent practices. This fragmentation creates ideal conditions for roll-up strategies aimed at capturing market share, centralizing operations, and improving margins.

2. Operational Efficiency & Economies of Scale

Roll-ups promise back-office consolidation, group purchasing power, centralized billing, and marketing automation. By eliminating redundancies and reducing fixed costs, acquirers can improve EBITDA margins and drive higher valuations.

3. Private Equity & Strategic Capital Influx

Private equity firms have raised billions in dry powder specifically earmarked for healthcare investments. With rising interest in recession-resistant assets, healthcare roll-ups offer both defensibility and a clear exit strategy, typically a larger strategic acquisition or IPO.

4. Regulatory Tailwinds

While regulations remain a concern (especially for physician-owned models), certain sectors, like home health and telemedicine—have benefited from more relaxed post-pandemic regulatory environments, encouraging broader investor participation.

Roll Ups in Healthcare: Pros & Cons for Founders and Buyers

Roll-ups offer distinct advantages—but also come with challenges. Whether you’re a seller considering joining a platform or an investor weighing acquisition targets, here’s what to keep in mind.

Roll Ups in Healthcare – Pros

Access to Growth Capital

Small practices often struggle to secure capital for expansion, new locations, or equipment. Roll-up platforms offer financial backing to grow faster than possible alone.

Monetizing Sweat Equity

Founders get a chance to take chips off the table, often with an upfront payment for their business and a “second bite at the apple” when the entire platform is sold at a higher multiple.

Operational Support

Owners joining a roll-up benefit from centralized resources including HR, legal, IT, marketing, and compliance, freeing them up to focus on patient care.

Roll Ups in Healthcare – Cons

Cultural Clash

Merging several independent practices under a single brand can lead to culture clashes. Misalignment on clinical philosophy or operational structure may affect performance.

Loss of Autonomy

Entrepreneurs who’ve built their practices independently may find it difficult to relinquish control, especially when KPIs and corporate mandates are imposed post-acquisition.

Integration Risk

Poorly executed integration can erode value quickly. Failure to align systems, staff, or workflows can result in reduced profitability and employee attrition.

Roll Ups in Healthcare: Hot Sectors to Watch

Not every healthcare niche is equally ripe for roll-ups. Here are five of the most active verticals where consolidation is creating new industry leaders:

1. Behavioral Health & Mental Wellness

Fueled by a national mental health crisis and increased insurance reimbursement, behavioral health—including addiction recovery, autism services, and psychiatric clinics—has seen a flood of roll-up activity. Acquirers range from PE-backed platforms to tech-enabled care providers.

2. Dental Practices & Labs

DSOs (Dental Support Organizations) continue their consolidation spree. Simultaneously, “Dental Lab Roll Ups” are gaining traction as labs centralize equipment, technology, and distribution to better serve DSOs.

3. Dermatology & Aesthetics

Highly cash-pay and low-overhead, dermatology is a darling of private equity. Multi-site roll-ups with cosmetic dermatology, medspas, and surgical aesthetics are multiplying across affluent metros.

4. Home Health & Hospice

Aging populations and value-based care are fueling demand for home-based services. Roll-ups in this sector focus on geographic density, Medicare certification, and quality scores.

5. Veterinary Clinics

A close cousin to human healthcare, the veterinary roll-up space has exploded with multiple billion-dollar exits. The mix of passionate founders, cash-pay customers, and loyal clients is highly attractive.

6. Nursing Homes & Assisted Living Facilities

With Baby Boomers aging rapidly, long-term care facilities—including skilled nursing, memory care, and assisted living are now targets for consolidation. Buyers seek operational turnarounds, real estate ownership, and labor cost arbitrage. A handful of REIT-backed buyers are also driving consolidation.

7. AI-Driven Diagnostic and Tech-Enabled Providers

A new frontier in healthcare roll-ups is emerging around AI-enabled diagnostic platforms, tele-radiology networks, remote monitoring companies, and software-driven service providers. These roll-ups appeal to investors looking to merge healthcare with scalable tech, creating hybrid valuation multiples.

8. Clinical Trials & Research Sites

Decentralized clinical trials and SMO (Site Management Organization) roll-ups are gaining traction. With Big Pharma outsourcing more research, PE-backed consolidators are acquiring trial sites across the U.S. and globally, offering centralized contracting and tech platforms to streamline study execution.

Roll Ups in Healthcare: Key Geographic Markets

Roll-ups tend to concentrate in regions where healthcare demand is strong, regulations are favorable, and workforce availability is reliable. Here are some hotspots:

Roll Ups in Healthcare by Region

Texas

With no state income tax, a booming population, and a favorable regulatory environment, Texas is fertile ground for platform expansion in behavioral health, dental, and primary care.

Florida

The retiree-heavy population and year-round demand for services make Florida a favorite for roll-ups in home health, hospice, and dermatology.

Northeast Corridor

New York, New Jersey, and Massachusetts are popular for specialty-focused roll-ups—especially in behavioral health, clinical trials, and outpatient surgery centers.

Bonus Markets: Arizona, Georgia, and Illinois

These states are seeing increased roll-up interest in pain management, urgent care, and functional medicine.

Roll Ups in Healthcare: Who’s Buying Who?

Several players are dominating the acquisition landscape, each with their own strategy and end game. Here’s a quick overview:

Roll Ups in Healthcare – Top Acquirers

Private Equity-Backed Platforms

Firms like Shore Capital, Waud Capital, and Varsity Healthcare Partners are behind multi-vertical roll-ups. They often buy a large “anchor” practice and bolt on smaller ones to grow rapidly.

Strategic Buyers

Companies like Aspen Dental, Envision Healthcare, and UnitedHealth’s Optum continue to absorb smaller competitors, gaining market share and vertical integration.

Entrepreneurial Aggregators

Smaller roll-up groups formed by operators with deep sector knowledge (e.g., former dentists, therapists, or clinicians) are also in the game, especially in niche markets where PE hasn't yet dominated.

Roll Ups in Healthcare: Final Thoughts

Roll-ups in healthcare are not just a financial strategy, they are reshaping how care is delivered, how providers operate, and how investors evaluate value.

While the path may not be right for every owner or founder, those who understand the economics and prepare early are best positioned to capitalize. Whether you're a seller looking to maximize your exit, or a buyer seeking a scalable opportunity, roll-ups offer a blueprint for accelerated growth, when done right.

If you're considering rolling up companies , or selling into one, let's connect for a confidential discussion.

He holds a Dental Degree from Creighton University and an MBA in M&A and Investment Banking from the University of Bedfordshire. Dr. Allen is the author of "Value Engineering: Strategies to 10X the Value of Your Clinic and Dominate the Market!" and the brand new book "Selling Your Healthcare Company at a Premium". Dr. Allen offers a free valuation to business owners ready for a partial or complete exit strategy. Dr. Allen collaborates with strategic buyers, private equity firms, and institutional investors, taking direct accountability for the annual successful sell-side representation of nearly $750M in enterprise value.

To have a confidential discussion about your company and receive a free valuation, please email Allen@ahcteam.com or Allen@ahcpexits.com

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