We are assisting many physicians, dentists and veterinarians as they are trying to determine what the best next steps are for their practices and themselves.  This can range from relatively new practitioners, all the way to doctors nearing the end of their professional careers.

Many solo practitioners are concerned about what would happen to their practices, families, staff and patients if they were to suddenly die or have to stop practicing on account of disability, for example.  We have discussed options with many such physicians and dentists.

Here are some scenarios to consider:

• Should they hire an associate who could hopefully be groomed to take the practice over?

• Should they enter into an agreement with another similarly situated practitioner, who would either buy the former’s practice or at least work to help keep it afloat, under contractually agreed to arrangements, until a long term successor is found?

• Should they seek out a merger partner? There may be neighboring practitioners who would be a fit here.  By combining, they may be able to avoid duplication in staff, equipment, space, advisors, and more.  It may more easily allow for the hiring of another doctor or adding another modality that neither could have financially justified as a solo.  It also would allow for mutually beneficial provisions in the event of death, disability or other departure from the practice.

• Should they seek to sell out (to another doctor, a larger medical group, a hospital, private equity group, or another entity)?

It is not a one size fits all world.  But, with private equity joining the market in some specialties the potential for cashing in for good money while addressing the above “what if” scenarios has been enticing.  The below sets forth just some of what we have seen recently.

In the last few months we have worked on the sales of two solo dermatologists to private equity buyers.  We helped a larger solo dental practice sell to a dental service organization.  An ophthalmologist and related surgery center are also being aggressively pursued as we go to press.  These are situations where large purchase prices were involved and post-sale employment arrangements were in sync with the respective doctors’ goals.

Others are transitioning their practices into hospitals/teaching institutions.  They often involve less in the way of purchase price.  But they may involve better remuneration packages while providing “titles” and administrative and teaching opportunities that some doctors crave.

When one is faced with these choices and/or is approached about such a proposed transaction, be sure to get experienced and competent, professional advice.  We want to be sure that you understand all of your options, are asking the right questions, critically analyzing the answers, and deciding what option (possibly including making no move at this time) is best for you.

Vasilios (“Bill”) J. Kalogredis has been advising physicians, dentists, and other health care professionals and their businesses for over 40 years.  He is Chairman of Lamb McErlane PC’s Health Law Department.  bkalogredis@lambmcerlane.com; phone, 610-701-4402; or fax, 610-692-6210.