Current market multiples for mental health and substance use disorder treatment facilities. Understand where your program fits and what drives valuations in today's market.
4.0x - 8.5x
EBITDA Multiple Range
Across all behavioral health service levels
7.0x+
Premium Programs
70%+ commercial, strong growth, management depth
+0.5x
Per 10% Commercial
Payer mix is the #1 multiple driver
Valuation multiples vary significantly based on treatment intensity, regulatory complexity, and payer reimbursement models. Here's what programs like yours are selling for.
Medical detoxification facilities with 24/7 nursing and physician oversight
4.5x - 7x
Median: 5.5x
Inpatient residential programs (30-90 day length of stay) for substance use and mental health treatment
4x - 6.5x
Median: 5x
Structured day programs (6+ hours/day, 5-7 days/week) for mental health and substance use treatment
5x - 8x
Median: 6.5x
Structured outpatient programs (9-20 hours/week) for ongoing mental health and addiction treatment
5.5x - 8.5x
Median: 7x
Individual and group therapy, psychiatric services, medication management for ongoing care
4.5x - 7.5x
Median: 6x
Peer-supported recovery housing with varying levels of structure and clinical services
3x - 5.5x
Median: 4x
Six factors that separate premium 8x+ valuations from average 5x multiples.
Commercial insurance penetration is the #1 value driver. Each 10% increase in commercial mix adds ~0.5x to your multiple.
70%+ commercial = premium multiples (7-9x)
Consistent revenue and EBITDA growth over 24+ months signals sustainable business model to buyers.
15%+ annual growth = 10-20% multiple premium
Business that runs without founder dependency. Strong leadership team (ED, COO, Clinical Director) in place.
Transferable operations = 1-2x multiple increase
High-demand metros with strong commercial insurance markets command premium multiples.
Top 50 MSAs with limited competition = premium
Larger facilities and multi-site operators benefit from economies of scale and platform potential.
$3M+ EBITDA or 3+ locations = strategic premium
Clean licenses, no survey deficiencies, and strong compliance track record are non-negotiable.
Any open issues = deal killer or major discount
Get a rough estimate of your potential multiple based on key drivers
What's happening in behavioral health M&A right now that affects your valuation
Buyers prioritize facilities with diversified commercial contracts (4+ payers at 15%+ each) to reduce single-payer risk.
💡 If >40% of revenue comes from one payer, expect 10-15% valuation discount.
Dual-diagnosis and integrated mental health/SUD treatment programs commanding 15-20% premiums over single-focus facilities.
💡 Purely SUD or purely mental health programs face commoditization. Integration = differentiation.
Private equity seeking $5M+ EBITDA platforms for add-on growth. Strategic premiums of 20-30% for scalable models.
💡 Multi-site operators with proven playbook for opening new locations command premium multiples.
Virtual IOP and outpatient capabilities viewed as competitive advantage, especially for adolescent and young adult services.
💡 Pure brick-and-mortar without virtual options may face 5-10% discount in competitive markets.