An experienced ophthalmologist had been looking for a way out of his PE backed group for more than a year. The volume mandates were increasing and scheduling pressure was unsustainable. He'd started reaching out to colleagues, scanning listings, and having quiet conversations with practice owners who might be interested in bringing on a partner or transitioning their practice.

The Practice That Matched

He found one. A well established ophthalmology practice in a major metro area, run by a physician in his 70s who was ready to step back. The practice had the right patient demographics, payer mix, and reputation. The retiring physician didn't want to sell to PE because he'd watched what happened to colleagues who took that path and wanted no part of it. He wanted a successor who'd maintain the standard he'd set over three decades.

The ophthalmologist fit the profile. Experienced, well credentialed, strong reviews. The conversations went well, both physicians respected each other and wanted the same thing.

Where the Deal Broke Down

The deal collapsed over contract risk.

The ophthalmologist's current employment agreement included a non-compete that restricted where he could practice for 2 years after departure. The radius was broad enough that the new practice fell inside it, or close enough to the boundary that the legal exposure was uncertain. His attorney advised that taking the position would create litigation risk that could cost more than the opportunity was worth.

He asked the retiring physician to structure the transition in a way that would reduce his exposure, either through a delayed start, consulting arrangement during the restriction period, or financial bridge that would cover his income if the PE group sued. The retiring physician understood the problem but didn't have the resources or the risk tolerance to underwrite that kind of protection for someone he'd only recently met.

The space between what the ophthalmologist needed to feel safe making the move and what the retiring physician could offer was real, and neither side could bridge it. After several weeks of back and forth, the retiring physician decided not to go through with the transition at all and just kept practicing.

Willing Parties, No Structure

Two physicians who wanted the same thing. A surgeon with the right credentials standing in front of a practice that needed exactly what he had to offer. Both sides willing and motivated, yet the deal died because the financial and legal risk of the transition fell entirely on the successor, and no one was positioned to absorb it.

This is what succession failure looks like when it has nothing to do with money, ego, or incompatibility. What was missing was a structure that could manage the transition risk so that neither party had to carry it alone.

How a Management Partner Absorbs the Risk

A third party operator that manages the business side of the transition changes the equation fundamentally. If the management entity handles the billing, payer contracts, staffing, equipment and operational risk, then the successor physician's downside is structurally capped. The successor's compensation is structured through the management agreement, not through a direct employment arrangement with the retiring physician. The management entity can sequence the transition around the successor's contractual restrictions, structure the timeline to minimize legal exposure, and provide the financial stability that the retiring physician couldn't offer on his own.

The retiring physician also benefits. Instead of trying to find a successor willing to accept the full risk of the transition, the retiring physician works with a management partner that handles the complexity. The conversation shifts from negotiating risk allocation to discussing clinical fit, patient continuity, and transition planning. The parts of succession that should determine whether a deal gets done are the parts that actually determine whether it gets done.

Every month that passes without a viable succession model for these transitions is a month where another deal like this one falls apart because the structure doesn't exist to make it work. Or at least, it didn't exist until now.

This article is for general educational purposes and is not legal or financial advice.

Verdira is a healthcare acquisition platform focused on ophthalmology practices. Physician ownership. Transparent structure. No volume quotas. If you are evaluating the ophthalmology market and want to understand how different practice models affect transition planning, we are open to thoughtful conversations.

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