Anyone have experience owning and running a pediatric clinic as a non MD?

July 25, 2025

by a searcher from Cornell University in Atlanta, GA, USA

Looking at acquiring a pediatric clinic in a downtown district in a major city. It's one location with 2 doctors and several nurses staying on. The seller is an MD retiring. I am looking for experiences from others, who are not MDs, on their ownership experience.

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Reply by a searcher
from University of Illinois at Urbana in Chicago, IL, USA

Bilal - some elementary concepts you may already have solutions for:| 1. Corporate practice of medicine - some states do not allow for non-clinician owners/prohibit them from billing government payors. Make sure to consult a lawyer/compliance professional in your state to ensure you can own the entity (or consider a managed service structure as a work around - will still need a "friendly physician" owner if your seller is leaving) 2.) A departed physician seller will directly hit top line revenue, make sure you're not including that drop through in EBITDA (even if you are hiring a replacement). 3.) Also consider what staff the physician is supervising - practice may be out of compliance of nurse to physician coverage ratios and suddenly your nurses may not be able to bill 4.) Also worthwhile considering a billing audit by companies like Farragut Square. Don't want a Medicare or other payor audit clawing back collections from you retrospectively (less important if you create a new clinical entity to bill from) 5.) However, if you create a new clinical entity to bill from, you're likely going to have to recontract (i.e. negotiate rates) with payors and then go through the separate process of recredentialing your billing clinicians with them. That will likely set your cash flow back a number of months 6.) Finally, in addition to point #5, be aware that there is meaningful lag in collections between services rendered and when you get paid for them in medical services. This cash flow cycle can be long and will need meaningful working capital support to ensure you can keep operating and build A/R when you start up (being a cash-only practice helps with this, but is relatively rare in most medical practices).

Reply by a searcher
from Western Illinois University in Atlanta, GA, USA

Bilal- I was in a similar situation. I have a couple Doctor contacts to help get around this issue. They are even willing to add equity. Im based in Atlanta as well. Perhaps we can link up to discuss opportunities. Have a great weekend. redacted

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