Social networking websites for doctors and other healthcare providers are proliferating on the internet. I belong to a few of them myself and find them very valuable. PrivatePractice.MD’s focus will be a little different from those sites because this community of doctors will welcome the advice and guidance these experts can offer. There will be an exclusive “Doctors Only” area on PrivatePractice.MD where doctors can chat and exchange ideas privately, but much of the site will encourage the conversation between doctors and all the other important people who make a practice successful. PrivatePractice.MD is about the business, the logistics, and the mechanics of the heart and soul of a healthcare practice. The other sites help doctors discuss clinical issues, this site helps them learn and share best practice management practices. The end result is that everyone is happier and healthier, including your patients, your staff and you.

So please join in the conversation. Tell your colleagues about PrivatePractice. MD. Tell your lawyer, your accountant, your office manager, your medical billing staff, your life insurance agent, your financial advisor. Tell anyone and everyone who helps make your practice the success it is.

The seller needs to determine the price tag, which is usually derived from data over the past five years of the practice, as well as comparable comparisons to similar practices that have been sold recently, and a host of other factors. The buyer will typically insist on an independent valuation of the practice and the process can be enlightening to the selling physician. In fact, if the seller begins the process far enough in advance, he or she can often make changes and additions in the last year or two before selling to greatly increase the practice’s value.

Practice Partners should have partner buy-out agreements already in place, typically agreed upon at the time a physician is made a partner. Because the pay-out to the departing partner usually depends on the practice’s current valuation, a current and accurate practice valuation is needed as noted above. Hopefully the valuation appraisal appears fair to everyone involved, and should be a transparent process.

If you are a seller without an identified buyer, then you need to advertise and promote the sale of your practice using a planned strategy. Do you want a lump-sum payment or are you willing to be paid over a number of years as your buyer gets established? Can you assist the buyer with financing? How are you going to advertise? Start with word of mouth at your local hospital and medical society? Journal or Web-based ads? Direct mail?

If you are a buyer looking for an established practice, can you get “pre-qualified” for financing? Just as the sellers may have an attorney or licensed broker assisting them, you too should strongly consider having professional advice in your search for your new practice. The terms and conditions for the sale of each practice you consider may vary considerably and you will need to decide what factors are most important and when you can be flexible. Are you willing to let the selling physician work part-time for you as an employed physician for instance? Will you need seller-financing to buy a practice? Will you guarantee employment of a practice’s current staff for some period after you take over?

Have you bought or sold a medical practice? If so, please share your experience, and any lessons learned here on PrivatePractice.MD for those following in your path.

It’s penny wise and pound foolish, to quote Ben Franklin (I think), to try and micromanage your practice, in my opinion. Set up your systems and your protocols and procedures correctly from the start and you should have less headaches. To set your practice up correctly you need input from other, more experienced, doctors, and your business advisors, including your lawyer and your accountant.

Having an effective office manager and resources such as a medical billing professional, healthcare information technologist, and a human resources expert to guide you on issues such as billing procedures, EMR software selection, and payroll and staff benefit options will help you avoid big regrettable mistakes later. Where do you find these experts? How do you know who to trust? PrivatePractice.MD, as it grows, will be a superb resource for you.

We can’t ignore the fact that our medical practice is a business. It provides us our livelihood and provides jobs for our staff and paychecks for everyone including the ancillary team of experts we rely on every day. Our main focus is quality care of our patients, but we can’t provide the best care if we are worried about paying our office rent or making next week’s staff payroll. We owe it to our patients (and our staff, advisors, and ourselves) to be just as smart about our business as we are about the medical care we provide.

My goal for PrivatePractice.MD is for this community to grow to include many experienced doctors and other healthcare experts and advisors. This rich community will share ideas, challenge each other, and be a resource for the new doctors starting their own practices. Please be an active participant! RB