Prices, meanwhile, are ranging from zero to hundreds of thousands of dollars above what appraisers would consider fair market value. It's all timing. Managed care has thrown out the window all rules of thumb about physician practice sales. No longer are comparisons to practice values throughout the country valid. Physicians who sell are no longer doing so to retire, move or otherwise close up shop.
Buyers are no longer just another friendly doctor.
And specialists are having greater difficulty finding buyers for their assets. In a national survey of hospitals and health care systems across the country conducted by the journal Healthcare Financial Management and Physician Services of America of Louisville, Ky., more than a third reported involvement in acquiring physician practices in the last five years. Of those, one-third purchased internal medicine practices or groups. Interestingly, the survey also found that in most markets, it was the doctors, not the hospitals, who were most likely to initiate discussion. Consultants say physicians considering selling should be prepared for a time-consuming, expensive and emotionally trying process that typically lasts three to six months.