The decision to sell a private practice can be a difficult one, but it’s only one of many you’ll need to make if you want it to be a smooth transition.
A doctor could wind up thinking about selling a practice for any number of reasons these days, from normal retirement to burnout or market forces. But there’s more to a sale than just handing over the keys. Whether a doctor is in the daydreaming stages or ready to pull the plug, succession planning is a must, according to an article in Physicians Practice.
“Physicians in private practice should make a point to start planning early and educating themselves about key concerns and considerations in the succession planning process,” writes Chris Mann of the law firm Dawda, Mann, Mulcahy & Sadler, PLC. Here are some tips to manage the process smoothly:
- Make sure you’re ready. Ideally, a physician will start a succession plan seven to 10 years prior to retiring, John Campbell, J.D., wrote in Modern Medicine. He recommends doctors focus on paying off student debt and saving for retirement as efficiently as possible, ensuring they’ll be able to pull the trigger when they are ready to hang up their stethoscopes.
- Be realistic. Everybody wants to get as much equity out of a business sale as possible, but physicians who don’t base that value on real data could be in for a difficult time. “Many physicians have a number in mind that they feel reflects the value of their practice,” says Mann, but those numbers frequently have little to do with fair market value.
- Don’t go it alone. Physicians underestimate the complexity of a practice sale at their peril. Campbell suggests a team of advisers with relevant experience in the areas of taxes, law, and finance.
- Don’t forget about your patients. When a trusted doctor retires, patients can become upset. Mann suggests plans focus on “continuity and patient retention,” ensuring a smooth transition for both the physician taking over and the patients who will visit his or her office.
Read the original article at FierceHealthcare.