Owning a medical practice isn't for everybody. There are a number of factors to consider before making that big decision.
Although Law 360 reported that the market for buying and selling medical practices is hot and has never been more active, physicians must be prepared to be a business owner as well as a healthcare provider, according to Renal & Urology News.
So first, ask why you want to buy a practice and whether being a business owner suits you. If you decide you have enough business savvy or have help from those who do, look carefully before you make the leap, the publication advised.
Consider the practice’s location and its demographics. Is the area growing? Are there already too many doctors? Are most practices owned by hospitals, which will likely refer most patients to practices they own?
Carefully assess the financial shape of a practice. Prior to selling or closing a practice, its owners must get the practice’s books and finances in order, according to attorney Jayme Matchinski in an article for the American Osteopathic Association. Look at how the valuation of the practice, a benchmark for negotiation of the purchase price, was established. Look back at the financial history of the practice and examine potential expenses, Renal & Urology News suggested.
Think about staffing needs. Has the practice been adequately staffed and paid? If physicians working in the practice will stay on, find out if they have the same vision for the practice, Keith Borglum, a licensed practice broker, told Renal & Urology News.
If you decide to buy, work out details of the transition, such as how patients will be notified and whether the selling physician will remain involved in the practice, said Matchinski.