IDD valuation multiples are the number every owner wants and almost nobody explains properly. You hear that a competitor “got eight times,” or read a range in a trade article, and it’s hard to know what it means for your business. Eight times what? Before or after the buyer’s adjustments? Including an earnout that may never pay?
This guide cuts through that. It sets out the published multiples for providers serving people with intellectual and developmental disabilities (IDD) in 2026, explains why small and large providers trade so differently, shows how platform and add-on buyers think, and walks through how to use the data without fooling yourself. It builds on our full guide to IDD business valuation.
Key takeaways
- Smaller IDD providers sold for 3.5x to 6.47x cash flow in 2026, with a median of 4.95x; platforms above $5 million of EBITDA traded at 6x to 10x (HealthFMV).
- Across behavioral health generally, FOCUS Investment Banking reported platform multiples of 9x to 15x EBITDA and add-on multiples of 5x to 9x in August 2026 (FOCUS).
- Always check what a multiple is applied to. SDE and EBITDA multiples aren’t comparable.
- Headline multiples often include earnouts and rollover equity. Compare cash at closing, not just the number.
What are IDD valuation multiples?
IDD valuation multiples are the ratio between what a buyer pays for a provider and its annual earnings, usually adjusted EBITDA or, for smaller owner-run businesses, cash flow or seller’s discretionary earnings. A provider with $1 million of adjusted EBITDA that sells for $6 million has sold at 6x EBITDA.
Multiples are shorthand for risk and growth. A higher multiple means the buyer believes the earnings are dependable and likely to grow. A lower multiple means they see more risk: a concentrated referral base, heavy turnover, a tight state budget, or an owner the business can’t run without.
What multiple do IDD providers sell for in 2026?
Published 2026 data puts smaller IDD providers at 3.5x to 6.47x cash flow, with a median of 4.95x, and larger IDD platforms with more than $5 million of EBITDA at 6x to 10x EBITDA, according to HealthFMV’s July 2026 guide. Where a specific provider lands depends on size, state, staffing, compliance and buyer competition.
Here’s the published data side by side:
| Segment | Multiple | Basis | Source |
| Smaller IDD providers | 3.5x to 6.47x (median 4.95x) | Cash flow, 25th to 75th percentile | HealthFMV, July 2026 |
| IDD platforms, more than $5M EBITDA | 6x to 10x | EBITDA | HealthFMV, July 2026 |
| Behavioral health platforms (all sub-sectors) | 9x to 15x | EBITDA | FOCUS, August 2026 |
| Behavioral health add-ons (all sub-sectors) | 5x to 9x | EBITDA | FOCUS, August 2026 |
Read the FOCUS rows carefully. They cover behavioral health as a whole, including sub-sectors like autism and mental health, not IDD specifically. FOCUS notes IDD is a growing category supported by high occupancy and long waiting lists, but doesn’t publish an IDD-only range. The HealthFMV figures are the closest IDD-specific benchmark available.
Why do smaller IDD providers get lower multiples?
Because buyers see more risk in smaller businesses. A provider with a few homes depends heavily on the owner, a handful of managers and a small referral base. One resignation, one survey problem or one lost contract moves results a lot. Larger providers spread that risk and attract more buyers, which pushes multiples up.
There’s a second effect. Bigger providers can be platforms, and platforms attract private equity buyers who pay for the base they’ll grow from. Smaller providers usually sell as add-ons or to regional operators. That’s why the jump from the small-provider band to the platform band is the most important feature of IDD pricing. Growing from $2 million to $5 million of EBITDA doesn’t just add earnings; it can change who buys you and what multiple they apply.
Are SDE and EBITDA multiples the same?
No. Seller’s discretionary earnings add back one owner’s full compensation, assuming the buyer steps into that role. EBITDA assumes the buyer hires a manager at market pay, so only pay above market is added back. Because SDE is a larger number, SDE multiples are lower, and mixing the two overstates value.
A quick example shows why it matters. Say your EBITDA is $700,000 and you pay yourself $200,000, of which $80,000 is above what a hired director would earn. Your adjusted EBITDA might be $780,000, but your SDE would be $900,000. Apply an EBITDA-style multiple to the SDE figure and you’ve inflated your value before anyone has negotiated anything.
How do platform and add-on multiples work?
A platform is a larger provider that a buyer, often private equity, uses as a base for growth. Platforms command higher multiples. Add-ons are smaller providers bought and folded in. Buyers pay less per dollar of earnings for add-ons, but once combined, those earnings are valued at the platform’s higher multiple.
This gap, sometimes called multiple arbitrage, is one reason add-on buyers can still pay attractive prices. Here’s a simplified, hypothetical illustration. A platform buys an add-on with $1 million of EBITDA at 6x, paying $6 million. If the combined business is later valued at 10x, that same $1 million of earnings is worth $10 million to the platform’s owners, before any cost savings.
For a seller, the lesson isn’t that you’re being taken advantage of. It’s that add-on buyers have room to compete, and that competition between several of them, not a single conversation, is how you capture some of that value. Our guide to private equity IDD providers explains how these buyers operate.
What moves your multiple up or down?
Buyers adjust the multiple based on how confident they are in your future earnings. The factors below are the ones that most often push an IDD provider toward the top or bottom of its range.
| Pushes the multiple up | Pushes the multiple down |
| Larger size and several service lines | Dependence on the owner or one manager |
| Low turnover, little overtime or agency staffing | High turnover, heavy overtime |
| Clean surveys, no open plans of correction | Open deficiencies or recent sanctions |
| States with stable, rising rates | States with rate freezes or budget stress |
| Full homes and a waiting list | Long-term vacancies |
| Broad referral base | One or two referral sources |
| Assignable leases at market rent | Informal or below-market related-party leases |
| Dense homes in one region | Scattered sites that are hard to supervise |
Staffing deserves special mention. The 2024 NCI State of the Workforce survey put average DSP turnover at 37%. Buyers compare you directly to that figure, and it’s one of the few factors that affects both your earnings and your multiple at the same time.
Why published multiples can mislead you
Treat any multiple you hear with care, for four reasons. First, IDD deals are private, so samples are small and skewed toward deals someone chose to talk about. Second, multiples are often quoted on the buyer’s adjusted earnings, not yours. Third, headline multiples frequently include earnouts and rollover equity that may pay less than face value. Fourth, strategic buyers sometimes overpay for a specific fit, like a county they need.
So when someone says a provider “got 9x,” ask: 9x of what, adjusted by whom, and how much was paid in cash at closing? The honest answers usually bring the number back toward the published ranges.
How do earnouts and rollover equity change a multiple?
They can make a headline multiple look much bigger than the cash you’ll actually receive. When a deal is described as “7x,” part of that value may be paid later, only if targets are hit, or reinvested in the buyer’s company. Always split an offer into its parts before comparing it with another.
Here’s a hypothetical offer on a provider with $1 million of adjusted EBITDA, described as 7x:
| Part of the offer | Multiple | Amount | When and how you get it |
| Cash at closing | 5.0x | $5,000,000 | At closing |
| Earnout | 1.0x | $1,000,000 | Over two years, if targets are met |
| Rollover equity | 1.0x | $1,000,000 | Only when the buyer sells again |
| Headline | 7.0x | $7,000,000 |
A competing offer of 6x all in cash could be worth more to you, depending on how likely the earnout is to pay and how much you trust the buyer’s growth plan. Our guide to IDD deal structures explains how to weigh each piece.
How should you use IDD valuation multiples?
Use them to find a realistic range, not a single number. Take your adjusted earnings, apply the published range for your size, and then ask which factors put you toward the top or bottom. That gives you a sensible starting point for conversations with advisors and buyers.
Here’s a worked, hypothetical example. A provider with $600,000 of cash flow, applying HealthFMV’s small-provider range:
| Point in range | Multiple | Implied value |
| 25th percentile | 3.5x | $2,100,000 |
| Median | 4.95x | $2,970,000 |
| 75th percentile | 6.47x | $3,882,000 |
The spread between the bottom and top of that range, about $1.8 million, is roughly what preparation and a competitive process are worth fighting for. For a practical plan to move toward the top, see how to prepare an IDD business for sale.
Do supported living and group homes trade at different multiples?
They can. Supported living is asset-light and scalable, which buyers like, but depends on delivering authorized hours with a stretched workforce. Group homes carry more real estate and occupancy risk. There’s no published multiple split between them, so buyers price each on its own drivers. Our guide to supported living business valuation covers that service line in detail.
Frequently asked questions
What is a good EBITDA multiple for an IDD provider?
It depends on size. For smaller IDD providers, HealthFMV’s 2026 data shows 3.5x to 6.47x cash flow with a median of 4.95x, so anything above the median suggests a strong business or strong competition. For platforms above $5 million of EBITDA, 6x to 10x is the published range.
Why did my competitor get a higher multiple than I’ve been offered?
Possibly several reasons: they were larger, had lower turnover or cleaner surveys, operated in a state with better rates, attracted several competing buyers, or their headline multiple included an earnout or rollover equity. Ask what the multiple was applied to and how much was paid at closing before comparing.
Do IDD valuation multiples change with interest rates?
They can. Higher borrowing costs make acquisitions more expensive for buyers who fund deals with debt, which can pressure multiples. IDD has been relatively resilient: The Braff Group noted IDD deal flow kept pace with pre-pandemic levels through 2022 and 2023, when rising rates slowed most other sectors, and reached a record 31 deals in 2025.
Is a multiple of revenue ever used for IDD providers?
Rarely as the main method. Revenue multiples ignore margins, and two IDD providers with the same revenue can have very different staffing costs and rent. Buyers occasionally look at revenue for context or for unprofitable businesses, but almost all IDD valuations are built on adjusted EBITDA or cash flow.
How can I increase the multiple buyers offer?
Reduce the risks buyers price in. Stabilize staffing, close open survey findings, broaden referrals, put leases on market terms, build management depth beyond yourself and, where possible, grow toward the scale that attracts platform buyers. Then run a confidential process with several buyers so they compete for the business.
Where can I find reliable IDD valuation multiples?
Start with published sources that state their basis and date, like HealthFMV’s IDD valuation guide and the quarterly reports from sector advisors such as Mertz Taggart and The Braff Group. Treat anecdotes from peers with caution. An advisor with recent IDD deals can share anonymized ranges that fit your size and state.
IDD valuation multiples: the bottom line
IDD valuation multiples tell you where your business sits, not what it’s worth on its own. Use the published ranges to set expectations, check what every quoted multiple is applied to, compare cash at closing, and focus on the factors that move you up the range. Competition does the rest.
| Want to know which multiple range your business sits in? Get the IDD Exit Report newsletter for quarterly valuation data, or book a confidential valuation conversation with the IDD team at Olympic M&A. Disclosure: IDD Exit Report is published in partnership with Olympic M&A, a healthcare M&A advisory firm. |
