buying a practice

[leon3087]

I an interventional pain/PM&R guy.

I got several offers to buy an existing practice either immidiately or or after working for a year.

What are the pros and cons? How to evaluate the practice?

Thanks!

 

[ampaphb]

I an interventional pain/PM&R guy.

I got several offers to buy an existing practice either immidiately or or after working for a year.

What are the pros and cons? How to evaluate the practice?

Thanks!

ONLY buy the current value of the hard assets and the accounts receivable that are realistically collectible. DO NOT let them talk you into placing a dollar figure on "good will" as part of the valuation. When Dr. Smith introduces me to his new associate, Dr. Jones, who will be taking over the practice, Dr. Jones does not in any way magically gain caché over any other new guy who recently moved to town just because Dr. Smith gave him his seal of approval.

 

[Disciple]

So, you're saying, don't allow the price to be raised to account for the reputation or referral base of the practice?

 

[ampaphb]

So, you're saying, don't allow the price to be raised to account for the reputation or referral base of the practice?

What I'm saying is, if you are buying a practice where the older partner is leaving, and you will be taking over, there is no way of assuring that either the reputation or referral base will transfer to you. That being the case, I would think very hard about whether any value should be attached to such an amorphous asset.

 

[Fro]

buy an existing practice either immidiately or or after working for a year.

if you're a resident getting these sorts of offers already you gotta believe those practices are sinking fast

 

[PMR 4 MSK]

I can't imagine having the capital or collateral to buy a practive right out of training.

Value of a medical practice is extremely difficult - much of it is, by nature "intangible" and what it is worth to the owner, may not be to you.

Speaking as someone who went solo from the start, I advise against it - unless you have owned a business before, been in the admin of a business or at least possess an MBA, don't do it. Better to spend some time working on learning how to practice medicine before you learn how much money you can lose buying and running you own business.