Selling Medical and Dental Practices to Corporate Buyers
Dentists and doctors are not always sure when the right time to think about transitioning their medical or dental practice. Years ago, when a professional got close to retirement age, they would market their office for sale or bring in a partner to take over their business. But now more than ever the buyers of a medical or dental practice is going to be a corporation. The margins have changed to the point where it is difficult for an individual doctor or dentist to buy a practice. Expenses keep going up while private insurance and government reimbursements continue to decline making it very difficult to generate a profit from a medical or dental office. Corporate medical and dental is a slightly different scenario.
Often time’s corporate doctors and dentists are private equity groups who do not need to finance their purchase. When a practice does not have debt the yields are calculated differently then when they are financed. Corporate medical and dental companies see the value of the founding doctor or dentist staying with the business. Years ago corporate buyers wanted the founding doctor or dentist to leave so they could implement their goals and objectives. Now corporate buyers want the doctor or dentist to stay around after the acquisition of the practice. Sometimes they even want them to stay on 10 years or more.
These corporate buyers can offer the dentist or doctor a sum of money up front, and a salary while they work and an equity stake in the DSO or MSO when the doctor wants to retire. Depending on the situation, a sale to a corporation may allow for a win- win for all parties concerned. Please feel free to reach out to HPRG for a free consultation on your situation. email@example.com, 301 . 571.9333, HPRGrealty.com.