by Kelly Reed

4 Things to Consider When Selling a Medical Practice


Every physician and practice owner will sell their practice during their career.  There are a variety of reasons which will lead to the sale of your business, some of which include:

  • Retirement
  • Choosing to sell your practice to a hospital|health system and becoming an employed physician
  • Merging your practice with a larger practice
  • Death or disability

What are some considerations that you should take into account?

  • Cost of Tail policies if you carry any claims made insurance policies.  Medical Professional Liability (medical malpractice) are commonly written on this type of insurance policy form.
  • Employees – What will happen to your staff?  Most employers are close to their employees and want to be sure that their staff will be taken care of in the future.
  • What is your company worth or otherwise stated what is the stock that you own worth?  If your operating agreement indicates the stock is worth $1, it may make negotiating the sale of that stock more challenging.
  • How will you be paid?  This sounds like a simple question, but can be complex in practice.  Everyone wants to make sure that the value of their company is maximized and you get as much $$$ up front, without hamstringing the future capital of the practice.

The best tip I can provide, is to do your homework.  This is true whether you are a medical practice or any other type of business. If you have proper planning on the front end by drafting an operating agreement, buy/sell, stock repurchase, etc… you have an opportunity to exit your business on your own terms and the business you built will be able to survive and thrive into the future.

For more information on how to plan for your “last sale” contact Kelly Reed | 906.315.7227 | kellyr@vastsolution.com.

The healthcare open enrollment period for 2022 individual and family health plans starts November 1 and runs through January 15.

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