Private hospital and clinic finance in the UK
Private healthcare has grown strongly in the UK as patients, employers and the NHS itself look for faster access to treatment. Day-surgery centres, diagnostic imaging, ophthalmology, orthopaedics, fertility, dental, physiotherapy and aesthetics clinics are all expanding, and many are growing by opening sites or buying smaller operators. That growth is capital intensive, and the businesses that fund it well tend to grow faster.
Lenders like private healthcare for its resilient demand and strong margins, but they look hard at three things: where the income comes from, who generates it, and how the business is regulated. A credit paper that answers those questions clearly is often the difference between a lender that sizes the deal on property alone and one that lends on the strength of the whole business.
Medical equipment finance for scanners, theatres and lasers
High-value equipment is the backbone of most clinics and hospitals. MRI and CT scanners, surgical robots, theatre suites, ophthalmic lasers and digital dental equipment hold their value well and have an active resale market, which makes them good security. Asset finance, a separate facility from the core lending, spreads the cost over the equipment's working life, typically two to seven years, and can fund up to 100% of the asset cost for established businesses.
Keeping equipment finance with a specialist lender also helps the rest of the structure. It leaves the main acquisition or property lender with cleaner security, and lets you upgrade technology without renegotiating your core facility.
Dental practice acquisition finance and goodwill lending
Dental practices are one of the most actively traded healthcare businesses in the UK, and specialist lenders have deep experience of funding them. For established practices with a reliable mix of NHS contract income and private patients, lenders will lend up to 5x EBITDA on acquisitions, from £200k to £100m, on the practice's earnings and goodwill rather than just the property, which for a well-run practice can cover most of the purchase price.
Lenders look at the buyer's clinical experience, the practice's income history, the NHS contract value where there is one, and the strength of the associate and hygienist team. For growing groups, the same principles apply to clinics in physiotherapy, optometry, aesthetics and veterinary care.
Buy-and-build healthcare groups
Once a group has completed a few acquisitions, funding each one separately becomes slow and expensive. A larger committed facility with an acquisition line lets you move quickly when an opportunity appears and shows sellers that funding is already in place. Lenders will look at how earlier acquisitions have performed, so good post-acquisition reporting matters. As debt adviser we run the platform financing end to end: the information memorandum, the lender process, term sheets and negotiation to completion.
Funding clinic property and new site fit-outs
Owning your clinic or hospital gives long-term control and a strong security base. Commercial mortgages on freehold and long leasehold healthcare property run from £1m to £100m at up to 75% loan to value, priced from 1% over Bank Rate (3.75%) depending on product and structure, over terms of up to 25 years, with the valuer taking account of the healthcare use and the trading it supports.
Opening a new site is a different kind of risk. Fit-out, equipment, CQC registration and building a patient and consultant base all come before revenue. A fit-out loan with a capital repayment holiday, sized against the performance of your existing sites, lets the new clinic ramp up without straining the group's cash flow.
Insurer, NHS and self-pay income
Private medical insurers usually pay within 30 to 60 days, NHS commissioners on their own cycles, and self-pay patients upfront or by finance. A business with a growing NHS contract or a large insurer share can find cash tied up even while profits rise. Receivables finance releases that cash, and lenders advance up to 90% of eligible insurer and NHS invoices, with funds within 24 hours of invoicing.
Lenders also look at the balance of income. A healthy self-pay share shows patient demand independent of insurers and the NHS, while strong NHS and insurer volumes show recognition and consistency. Most lenders are comfortable with any sensible mix, provided it is clearly presented and the trends make sense.
CQC registration and consultant arrangements
Every regulated activity a clinic or hospital carries out needs the right CQC registration, and a change of ownership or a new site usually means new or varied registrations. Lenders build this into their conditions, so it pays to plan the regulatory steps alongside the funding rather than after it. In Scotland, Wales and Northern Ireland the equivalent regulators apply.
Consultant arrangements are the other question every lender asks. Many private hospitals and clinics rely on consultants who practise under admitting rights rather than as employees, and a few may account for a large share of revenue. Lenders are comfortable with that model when it is explained clearly: how long the relationships have lasted, how revenue is spread across consultants, and what the business offers that keeps them there.
Funding management buyouts and partner exits
Many clinics and practices are owned by founding clinicians who want to retire or step back. A management buyout, or a buy-in by a new partner, can be funded on the earnings of the business at up to 5x EBITDA, often with a mix of senior or stretch senior debt, equipment refinance and deferred consideration or vendor loan notes to the seller. We advise on the transaction and run the debt process, so the clinicians can keep treating patients. It keeps the business in the hands of the people who run it and gives the founder a clean exit.
What makes a private healthcare deal fundable
We help you pull this together and present it in a credit paper that tells the story of the business, then manage every lender on the deal so you have one adviser from first call to drawdown.
- Site-by-site management accounts that tie to the filed accounts
- Clear revenue reporting by payer and by service line
- A transparent summary of consultant and clinician arrangements
- Up-to-date CQC registrations and inspection reports
- An equipment schedule with ages and replacement plans