There are a number of occasions that require the formal valuation of your medical and dental practice, such as death, divorce, sale of all or part of the practice, disability, etc. There are also a number of occasions in which it is either advisable or desirable to know just what your practice is worth.
Our medical and dental practice valuation process is the same regardless of the triggering event. We look at the value of the practice from a number of perspectives and calculate the value in several ways, each of which is valid and according to normal accounting standards. We then take a blend of these various methodologies to determine our final dental and medical practice valuation.
It is our recommendation that every practice should have an initial medical or dental valuation with periodic updates for several reasons. If the dental or medical practice valuation has been performed and kept up to date, then all parties are able to plan and anticipate exactly what would be the financial consequence of any triggering event.
Dental or Medical Practice valuations performed after an event such as death, disability, etc., become personal. Medical or Dental practice valuations performed before the triggering event are evaluated logically because the parties do not know, at that time, whether they would be in the position of buyer or seller and can therefore look at the value more objectively.
In the event of death of a solo physician, we believe the updated dental or medical practice valuation, coupled with a document designating DoctorsManagement (or whoever has specific knowledge of the practice and its value) should be contacted immediately to initiate a process of transferring (selling) the practice before its value drops significantly. If we are familiar with the practice and have already done the medical or dental practice valuation, we can immediately put it on the market and get the top possible price. The longer a practice sits without a physician or even with a locum tenens provider, the lower its value.