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Should You Sell Your Medical Practice?

If you are a physician who is consider- physicians or a practice management lump sum purchase price, but will be
ing selling your practice, there are a company or private equity firm which receiving a reduced salary for only a lim-
number of important issues you must employs a large number of physicians ited number of years. The transaction
think about before you proceed. will be able to negotiate better payor con- may be less advantageous for more junior
tracts than an individual physician or physicians, who may be “repaying” the
Who Will Purchase My Practice? small group practice. purchase price by receiving a lower
Hospitals, physician practice manage- Finally, selling your practice will salary for a much longer period of time.
ment companies, private equity firms, enable you to achieve financial security, Physicians should also understand that
and even insurance companies are all in by receiving a cash payment that will, a practice acquisition will be successful,
the market for physician practices. hopefully, reflect the value you have cre- for both purchaser and seller, only if fun-
Hospitals are looking to secure a stream ated over years of building your medical damental and positive changes are made
of referrals from their physician employ- practice. in the operation of the practice—to
ees for hospital inpatient and outpatient increase revenues and control expenses.
services. Health insurance companies are BY MARSHALL R. When Should I Sell? Physicians looking to sell their practice
looking to control the costs of caring for BURACK When is the best time to sell your prac- should understand, prior to the sale,
their members. Practice management tice? For physicians who are becoming what operational changes the purchaser
companies and private equity firms overwhelmed by the managerial and eco- intends to impose, and the physicians
(which generally pay the highest prices tices to obtain management support and nomic challenges of operating an inde- must be prepared to accept and embrace
to acquire practices) are in it to make a to shift the burden of managing their pendent medical practice, or who are these changes, if they want the transac-
profit from the operation of physician practice to a larger, more qualified busi- being forced to accept unfavorable con- tion to be successful.
practices. You must decide what is the ness entity. Hospitals, practice manage- tracts from health insurance companies,
best fit for you. ment companies, and private equity and who are willing to practice medicine What Is the Next Step?
firms are able to provide experienced as an employee of a large organization, If you are thinking of selling your prac-
Why Should I Sell My Practice? professional management personnel to rather than as a partner of a small group tice, you should engage qualified legal,
What Are the Benefits? manage the business end of a medical medical practice, the time to sell may be financial and tax advisors to help answer
The health care industry is experienc- practice, allowing the physicians to con- now. your questions and to assist you, if you
ing tremendous disruption and change, centrate on caring for their patients. elect to proceed. The sale of your medical
which is making it more difficult to oper- In addition to the increasing complex- What Do I Need to Know about practice may be the most important step
ate an independent medical practice. ity of managing a medical practice, the Economics of a Practice you take during your professional career.
Physicians are increasingly looking to physicians are finding it is increasingly Sale? You want to assemble a team of experi-
sell their practice to a third party which costly to operate a medical practice. If you plan to sell your practice, you enced professionals to make sure you
can help them address the challenges of Personnel and occupancy expenses are must understand the economics of the receive fair value for your practice and
managing and financing the operation of increasing. Electronic medical records proposed transaction. A purchaser which that you are legally protected against
a medical practice. Physicians are becom- systems are expensive, and a modern pays you a significant sum of money will unreasonable or unfair contractual provi-
ing overwhelmed with the burdens of medical practice often requires costly need to recover its investment, plus a sions and unforeseen future events.
complying with new Medicare require- new equipment. Selling your practice to return on its investment, over a period of
ments and regulations, dealing with a well-capitalized purchaser can provide time. A purchaser will generally seek to Marshall Burack is a partner at
commercial insurors, complying with much needed financial resources to recover its investment by paying the Kopelowitz, Ostrow, Ferguson, Weiselberg
HIPAA requirements, addressing new HR address these financial requirements. employed physicians a lower salary than & Gilbert, P.A., a law firm with offices in
requirements and increasing costs of pro- The sale of your practice should also the physicians were previously drawing Fort Lauderdale, Coral Gables and Boca
viding health care and other benefits for result in increased leverage in negotiat- from the practice, and retaining the dif- Raton. For more information, visit
employees, and dealing with other bur- ing provider contracts with commercial ference. This arrangement can work to www.kolawyers.com.
dens of operating a medical practice. insurance companies. A hospital system the advantage of more senior physicians
Many physicians are selling their prac- which includes numerous employed in a group, who may receive a substantial

Maria Albury, Executive Director of Greystone’s

Wilton Manors Health and Rehabilitation Center, Wins Award

from Greater Fort Lauderdale Chamber of Commerce

Greystone Healthcare Manage ment, “We are so happy that Maria who loved to write, dubbing her “Artist
an industry-leading healthcare man- received this lovely award from in Residence.” She became a contribu-
agement company, announced that the Greater Fort Lauderdale tor to the rehabilitation center’s
Maria Albury, Executive Director of the Chamber of Commerce,” said newsletter. Albury traveled out of state
Wilton Manors Health and Kimberly Pero, regional vice to track down the birth certificate of a
Rehabilitation Center, was honored president of the South Florida recovering stroke patient who never
with an Excellence in Healthcare Region. “She is someone who was able to secure it on his own. She
Award from the Greater Fort never hesitates to do something aided a homeless woman in the com-
Lauderdale Chamber of Commerce. special in order to meet her munity and was able to reunite her
The Chamber recognized people in the patients’ needs. We have long with her family in Pennsylvania. The
healthcare industry who go beyond the known her dedication to her list goes on.
ordinary scope of their job to make a job is extraordinary – it is won- Albury joined Greystone in 2006.
positive impact in the community. derful that more people know She previously served as the Executive
Albury has more than 20 years of now.” Director for Greystone’s largest skilled
healthcare leadership experience. As There were many anecdotes nursing facility, Unity Health and
Executive Director of the Wilton that demonstrate her commit- Rehabilitation Center. Since joining the
Manors location, Albury runs all oper- ment to patients. The judges Greystone family, Albury has received
ational aspects of the facility, from learned how she created her multiple awards including Greystone’s
patient care to new hires to quality Chris Coffey, President & CEO of Sunshine Health “Stars of Life” program, offering Outstanding Leadership Award for
assurance. Wilton Manors is one of and Kate Goldman, Director of Government and skilled, custodial and rehabilita- Sustainability.
four Greystone health centers located Community Relations for Baptist Health South tive services along with a holis- Albury graduated from the
in South Florida, offering skilled nurs- Florida flank Maria Albury, winner of the tic approach for people affected University of Miami. She is a Certified
ing care, rehabilitation services, med- by HIV/AIDS. She purchased a Preceptor and has mentored many
ically complex care and traditional Excellence in Healthcare Award from the Greater typewriter for a patient who aspiring administrators through the
long-term care services. Fort Lauderdale Chamber of Commerce. experienced respiratory failure years.

South Florida Hospital News southfloridahospitalnews.com December 2018 17