The challenge: Selling a practice without a broker's help
FAMILY HEALTH CARE AIKEN, SOUTH CAROLINA
THE CHALLENGE: Selling a practice without a broker's help.
Olivia Cato Bland has no use for a broker.
"I realize there are brokers available, but I would really like to accomplish this on my own," says Cato Bland, her confidence stemming from a previous 10-year career in real estate.
The practice has plenty of selling points, she says. Foremost may be its designation by the federal government as a "Rural Health Clinic" in an underserved area, which entitles the practice to higher Medicaid and Medicare reimbursements.
In addition to receiving a fair price for the practice, Cato Bland wants to be sure she and her husband are leaving Dr. Bland's 2,500 active patients in good hands.
"We are interested in selling our medical practice to one or two physicians who can step in and give it the time it needs to grow and grow," she says.
First, the Blands should get a practice appraisal from a specialist in the field, says Mark D. Scroggins, CHBC, CPA, a practice management consultant with Clayton L. Scroggins Associates in Cincinnati, Ohio. That could cost more than $3,000, but it'd be money well-spent and would give them a ballpark figure of the price they should expect.
In seeking to identify potential buyers, the Blands should begin by contacting competing hospitals within a 50-mile radius of their practice, according to Scroggins. "The hospitals may want to expand or protect their market referrals, plus they have deeper pockets," he says.
If that doesn't work, try nearby or regional physicians, who may be looking to expand their practices by adding another location.
While shopping for a buyer, Scroggins recommends temporarily hiring another provider, such as a physician's assistant or locum tenens doctor, to give the Blands plenty of time to look into all their options. A feeling of urgency to sell could work against them.
"When searching for the best buyer and terms, you need to make time your ally," Scroggins says.
Next month in Medical Economics: Consider the risks and rewards of selling your practice-or buying someone else's.