Selling a Dermatology Practice In Today's Market
Baby boomer physicians are continuing to age in great number, necessitating the sale of their practices. The Great Economic Crisis negatively impacted a large segment of selling physicians who were counting on maximizing the value of their practices for retirement purposes. The Crisis drove many of these doctors to hold-off on selling their clinics out of fear, or out of necessity to re-build battered retirement reserves. The financial and consumers markets, while not fully healthy, have recovered to a sufficient level to drive sellers back into the market to divest their clinics. Factors related to dermatology reimbursements also have a bearing on the decision for many buyers and sellers.
We believe that the natural cycle of retiring and selling doctors combined with the glut of backlogged sellers from the Crisis, will cause a flood of selling activity on the practice market in the coming years. The influx of selling practice may create a buyer's market and require sellers to re-think their selling strategy. This will be magnified by buyer risk-aversion due to impending changes in reimbursements, insurance coverage, and mandated clinical requirements. Pressures on the buyer pool may reduce the the number of physicians who are willing to proceed with buying a dermatology practice, even if these fears are overblown.
In preparation, selling doctors need to establish a solid pre-sale strategy to enhance practice performance and maximize value. Transactions will be treated with a greater deal of buyer scrutiny and will require a greater substantiation of practice valuation (e.g. medical practice appraisal by a certified healthcare business appraiser). Sellers should seek the guidance of medical practice brokers and appraisers who demonstrate proven experience and an understanding of today's market for selling practices, in order to help them achieve their objectives within their given timeframe. Prudent buyers of practices will naturally do the same, as they approach potential acquisitions in the changing marketplace.
Transition Consultants is a medical practice sales and appraisal firm providing transaction advisory, merger/acquisition, and valuation services to physicians, medical groups, and clinical organizations nationwide. Dermatology is one of our core competencies; Our team has valued and structured dermatology-related deals for a multitude of individual doctors, health groups, hospitals, and private equity groups. For details please contact an advisor at 800-416-2055.