Choosing an Experienced Health Care Appraiser
March 1, 2015 |
Download PDF
Thinking of Buying or Selling a Medical Practice? Having an experienced health care appraiser will ensure that the correct information and documents are requested, the right questions are asked, and all of the potential opportunities and risks of the entity and industry are included in the valuation. There are many resources available to health care appraiser.
Thinking of Buying or Selling a Medical Practice
Having an experienced health care appraiser will ensure that the correct information and documents are requested, the right questions are asked, and all of the potential opportunities and risks of the entity and industry are included in the valuation. There are many resources available to health care appraisers, including:
- The MGMA Data Dive database which allows for a detailed search for physician compensation, productivity, costs, and other financial and non-financial information frequently used in health care valuation;
- The Goodwill Registry, which is updated annually;
- Statistics and resources regarding ambulatory surgery centers and imaging centers;
- Health care law resources, specifically regarding Stark and the Federal Anti-Kickback Statute. The Stark law does not allow physicians to be compensated based upon the volume or value of their referrals to an owned facility. The Federal Anti-kickback statute sets forth that health care providers cannot exchange remuneration in return for referrals of federal health care program business (i.e. Medicare and Medicaid).
- Trade journals for the medical industry that include articles and information regarding changes in the industry and specific medical specialties;
- Medical equipment appraisers, and more.
valuation of health care entities
The valuation of health care entities has become a sub-specialty of business valuation, and individuals desiring a healthcare valuation should be sure that the hired appraiser has the necessary experience and resources for the engagement. Too often we find that business appraisers improperly rely on industry –wide data. Reimbursement rates, compensation, overhead costs, patient demographics, growth rates, and other factors are vastly different depending on the practice specialty (i.e., cardiology vs. dermatology), size of practice (i.e., two physicians vs. 20 physicians), location of practice (i.e., New York City vs. Columbus, Ohio) and other factors.
