Acquiring a medical practice and setting up a Mgmt. Services Org.

searcher profile

March 07, 2020

by a searcher from Georgetown University in Chicago, IL, USA

Does anyone have working knowledge (perhaps some reading material as well) on what is required to acquire a medical practice w/o having a licensed physician on the cap table? I believe this would entail establishing a "Management Services Organization" to act as the acquiring entity, but that's the extent of my awareness on the topic. My guess is that this varies by state.

I know of a couple different search funds that have acquired medical practices (dental and eye care), but I'm not sure if they set up a MSO.

Thanks in advance!

5
9
209
Replies
9
commentor profile
Reply by a searcher
from Rensselaer Polytechnic Institute in Queens, NY, USA
^redacted‌ is spot on! Corporate practice of medicine laws vary widely state to state. An experienced attorney in this space is crucial. Interview them. If an attorney can't whiteboard the whole structure for you, keep looking until you find one that can. In my experience, giving equity to your medical director is the best way to motivate and retain a quality physician (which you need in this business!).
commentor profile
Reply by an investor
from New York University in New York, NY, USA
Peter: Echo above, every state is different and every medical field is different, this includes the profitability of each state, depending on a variety of conditions within each industry.

Having managed one or two, who your Dr is in the chain, is as important as the structure itself (don't kid yourself). Feel free to reach out, if you like.

Good luck
commentor profile
+7 more replies.
Join the discussion