Physician Owned Practice Representation

One of the biggest challenges for our healthcare clients is understanding the value of hiring a law firm to help navigate a practice sale or purchase especially when a practice can be purchased with cash proceeds or through seller financing (meaning, the buyer pays the seller incrementally).  

 

The problem with structuring a sale of assets and goodwill or equity (a purely legal process) without the help of a team that understands both law and healthcare is that it can cause that presumably “easy sale” to evolve into a post-closing nightmare.  Believe it or not, acquisitions are not as simple as a handshake agreement and change in vendor/insurance contracts.  At minimum, an acquisition conducted through a seasoned legal eye with substantial experience in healthcare practices will consider the following:

 

1. How will the sale be structured?  Can the buyer obtain traditional bank financing to minimize any post-closing risk of default as a result of not paying the monthly payments that were promised to the seller?  
    

2. How will the transition period be structured? For example: will a traditional asset sale be sufficient for a large multi-location urgent care clinic where insurance credentialing needs to be considered?
    

3. Does the purchase agreement adequately outline how the seller’s account receivables will be collected and how on-going procedures (if any) will be handled
    

4. Are there any practice liens that need to be cleared at closing to make sure that the buyer is not taking on unexpected debt? For example: think of cosmetic/ plastic surgery offices with multiple laser machines and leased equipment.  

 

We approach every deal with the understanding that our clients are equipped with making their own business decisions but need education and legal guidance to execute their business decisions. Whether you are a buyer or a seller of a medical practice, the acquisition process can be cumbersome. Our goal is to guide you through the process to ensure that you are fully supported at each stage of the process to achieve your goal with transparency of fees so that you can focus on your deal without concern about your legal bill.

 

The practice acquisition process has multiple steps, particularly for buyers, including but not limited to:

 

• Financing/Approval Process

• Initial Preview of the Practice/Letter of Intent

• Purchase Agreement Drafting/Negotiations

• Fulfillment of Lending Requirements (if applicable)

• Obtaining Insurances

• Entity Formation

• Lease Review/Assignment or Purchase Contract for the Underlying Real Estate

• Ancillary Matters Such as Post-Closing Seller Transitional Services and Staff Considerations

• Closing/Escrow/Disbursement of Funds

 

We also provide limited-scope services in the event that you only want a review of the purchase agreement or lease, but we strongly encourage our clients to take advantage of our full-service, flat-fee solution to make sure your deal is handled appropriately.