BLOG: Considering taking the plunge?
For the independent practices out there, it’s natural to wonder at some point if you should consider selling. But where to begin?
First and foremost, to the extent there are multiple physician owners, you need to make sure everyone is on the same page. These discussions may be hard, but the owners of the practice need to coalesce around an agreement to sell. Does everyone want to sell, and for the same reasons? Does everyone agree on how the proceeds will be split? The last thing you want to do is get far down the road in a potential sale negotiation, only to then find out that one or more of your partners has no interest in selling (maybe they never did, or maybe they don’t like the type of platform you’re considering joining). That can be a costly mistake, in terms of both time and dollars.
Once you have internal alignment, you need to do your diligence. Talk to physicians who have sold and joined platforms. Don’t just talk to the people who the buyer or platform suggest. Talk to people who your advisers or peers suggest. Ask if the way they practice medicine was affected at all by the transaction. Ask if the benefits they sought by partnering with a platform have been realized.
If you are considering specific platforms, do your diligence on the financial sponsor(s) that own the platform. Have they been in medicine before? Do you know what their vision is for growth and how they plan to accomplish that — and do you share the same vision? Have they put in place a qualified management team that understands physician practice management and the business and clinical nuances of your specialty area? Do they let the practices they partner with continue to operate the way they always have, or do they try to get all practices to adopt the culture and approach of the platform?
These deals are about more than just economics. Yes, the money is appealing. But not all platforms are created equal — make sure you do your diligence so you don’t make a decision that you may regret down the road.
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