Any non-physicians that have bought a health care clinic?

April 19, 2024

by a searcher from Northwestern University - Kellogg School of Management in Atlanta, GA, USA

I'm a non-physician trying to buy a health care clinic in the state of FL (from a physician).

- How did you keep the insurance contracts continuous with BCBS, Aetna, Medicare, etc?

Best as I can figure, I need to buy the company stock (shares) to keep the TIN (EIN)?
- Does it help to leave the doctor on with 5% equity?
- I have an SBA lender who might be OK with purchase, but if you have others I'll take names...
- Attorney that can help model the sales agreement? Liabilities post sale if I keep the TIN....
Thoughts? Experience? Names?

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Reply by a searcher
from New York University in New York, NY, USA

Agreed with Andrea. It depends heavily on the state and type of healthcare entity you're acquiring. I am an owner at a pharmacy and I'm not a pharmacist. But we've been negotiating an LOI on a behavioral health entity and would need to set up an MSO that can only own the non-clinical assets, while we'd need a clinically licensed employee to "own" the clinical assets in a separate entity. My lawyer unfortunately is only NY/NJ or I'd refer you. The insurance contracts are an issue but not a big deal if you plan and leave enough time. How long? Your guess is as good as mine. It's a bit of a wildcard. But I can say that it seems way worse to a healthcare outsider than insider. It's a HUGE pain but it happens all the time and for those of us working in healthcare, we're used to it. But it can definitely cause delays in you operating at full capacity.

We had a change in ownership at the pharmacy (brought on a new partner) and Medicare specifically gave us a hard time about it, but it was resolved somewhat. We're still waiting on a chunk of receivables from Q4 last year, but we're ok going forward. You just need to accept that it's going to be a pain in the butt and take longer than you'd expect. But again I'm not a lawyer you definitely need a healthcare transaction specific lawyer in your corner that knows FL inside and out.

Reply by a professional
from Seton Hall University in Morristown, NJ 07960, USA

Hi ^redacted‌! Sorry I missed this post but it was probably after our conversation anyway. Your thoughts of leaving the doctor in place with 5% equity make sense to me, as I have worked with the MSO/DSO/friendly doctor model several times recently. I agree with the comments I have read above, but we used an alternative which included two LLC's, one clinical, one non-clinical. We were transferring doctors so we used an agreement to keep the old doctor billing - I like your options better if the doctor is friendly. The transition could take 90 days. Cleaner, but risk remains with the seller/doctor still involved. Happy to chat anytime - give you all my background info on the subject!

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