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Private practices: Tips before agreeing to medical practice buyout

The Avalere Health and the Physicians Advocacy Institute (PAI) reports acquisitions by hospitals of physician practices increased 128 percent from 2012 to 2018. The group estimates hospitals acquired over 13,000 physician practices from 2015 to 2018. PAI estimates over hospitals own over 80,000 physician practices throughout the country.

It appears this trend will continue. PAI predicts the rate of healthcare mergers involving hospitals acquiring private practice physician groups will continue to grow through the year.

What does this mean for physicians? Proponents of these transactions assert physicians can use this transition as an opportunity to focus less on business needs and more on quality care to patients. With the right deal, physicians can achieve this goal while also increasing efficiencies and cutting costs.

What is the right deal? Although the right deal will vary depending on the details of each practice, a good deal for physicians often involves a hospital that can provide the financial and technological infrastructure needed for modernization and growth. In other situations, an independent practice may consider joining an association of independent practices to better assure their continued autonomy.

Whatever decision a private practice is pursuing, it is wise to seek legal counsel to review a deal before moving forward. An attorney experienced in business transactions can provide assistance throughout the transaction. This process can begin with negotiating a deal that works best for your practice, drafting and reviewing documents to better ensure your business interest are protected and being there with you while the deal is completed.

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