South Florida Hospital News
Friday February 26, 2021
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October 2013 - Volume 10 - Issue 4
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Buying a Medical Practice

There are a number of scenarios where an individual would consider buying a practice. Purchasing a medical practice from a retiring doctor can be an excellent idea for a younger doctor looking to take on greater responsibilities and become established in a community.
 
But be wise and diligent. Every practice has numerous facets you need to investigate. Among the top priorities is the structure of the transaction – is this a stock purchase, where the seller does not retain any liabilities, or an asset purchase with limited indemnification? Will the seller sign a non-compete? To what degree will the seller remain involved?
 
Prior to the purchase, consider representations and warranties carefully. Representations are statements that cover a wide range of time, up to the present. Warranties look ahead and offer safeguards for the future. The combination of representations and warranties offer the buyer a set of assurances for the future, based on the present and past activities and issues of the practice. As healthcare gets increasingly more complicated, the assignment of contracts is a critical aspect of the purchase of a practice. Contracts can be the foundation of the practice – certainty about which ones can be assigned to a new party is essential, as is precise language in the contract.
 
Always use a professional who understands the complexities of such a transaction, who can negotiate the best price, offer the wisdom of experience and create a contract that is sensible and effective.
Jodi Laurence is a board certified health laws attorney and co-founder of Florida Health Law. She can be reached at jl@flhealthlaw.com or (954) 358-0155.
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