Private equity (PE) firms have been active in healthcare for long enough that their pattern, or “playbook,” has become clear. Buy up specialty groups, restructure operations to improve revenues and cut costs, increase the value of their acquired assets, and sell to the highest bidder after several years. The specialties of interest have evolved in waves as markets become saturated or regulatory conditions change (case in point: emergency medicine roll-ups took a significant hit due to the No Surprises Act), but using debt-leveraged buyouts to generate economies of scale is a formula that could work for any specialty. The emergent problem for PE firms, and more crucially their physician platforms, is that the highest bidder is almost always another PE firm. In a study of 807 dermatology, ophthalmology, and gastroenterology practices acquired by PE firms between 2016-2020, 52 percent underwent a secondary sale to another (usually larger) PE firm, while only one percent were sold to a strategic buyer. This is unsustainable because these secondary sales rely on a more aggressive form of the same playbook. Physician partners may enjoy a further boost to their equity, but younger physicians will cede more of their autonomy and patients eventually face even higher prices. It comes down to how one defines value, an existential question in healthcare. PE firms are very successful at creating financial value, which appeals to other likeminded PE firms, but they have been less interested in generating the transformative value that leads to a final strategic exit. The cycle of secondary sales will continue to play out for some time, but we’re approaching a ceiling that may require a new playbook to deliver the ultimate return on investment.