Why Now is the Time to Sell Your Urgent Care Practice
There are a number of keys to selling a medical practice, and increasingly doctors are joining larger health systems rather than trying to run a practice on their own. The same is true for urgent care practices, a part of the ambulatory health care system. Urgent care practices usually act as stand-alone walk-in clinics where patients can be seen in a manner similar to that of an emergency room.
This type of practice has several advantages, but if you run one of these, now is a great time to sell. Why? Here are a number of reasons.
Urgent Care Practice Industry Growth
The urgent care industry is growing. The United States spends 5% of GDP on Ambulatory Health Care which includes emergency rooms, emergency dentists, and other urgent care needs. About 40% of this revenue goes to physicians.
Due to the lack of family care physicians and often how long it takes to get an actual appointment, patients tend to use Urgent Care facilities for illnesses rather than just emergency services. This fact is spurring growth in this area, but with that growth comes some significant challenges.
Physicians who work in and run this type of clinic often don’t have regular patients, their workload is irregular and often seasonal, and extended hours are essential in order to meet patient needs.
The Urgent Care Practice Competitive Landscape
Using urgent care is also popular with patients because of the low cost compared to emergency room visits and hospitals. However, many hospitals and large health care systems offer their own urgent care facilities to capitalize on the needs of patients. While there are many patients who use these types of practices, there are also a lot for them to choose from.
As the competitive landscape changes, there is pressure from insurance companies, patients, and even the Federal government to reduce health care costs. This makes it harder for an Urgent Care practice to remain profitable. For the system to work, doctors need to see an average of around 20 patients or more each day, leaving little time for in-depth diagnosis and thorough health histories.
Regulations Related to Running an Urgent Care Practice
Like other medical practices and institutions, an urgent care practice is subject to many local, county, state, and Federal regulations. Not only are their physician and facility licensing rules, but there are also various finance regulations that must be adhered to related to collections, billing, and other common medical practice tasks. In order to expand an urgent care practice, many states who have requirements of staff to patient ratios require a Certificate of Need (CON) be approved.
Federal regulations regarding electronic medical records (EMR) and patient information and privacy have gotten stricter. The cost of healthcare is also being addressed at a Federal level, and no one is certain what the regulations will look like next.
Selling an Urgent Care Practice to the Right Buyer
Selling your urgent care practice now is a good idea simply because you can’t just sell it to anyone. The buyer must be a licensed physician or healthcare organization like an HMO or a hospital group. As more medical practices merge or are purchased by these groups, there are fewer buyers in the market for medical practices and specifically urgent care practices.
As the number of buyers is reduced, the market turns from a seller’s market to a buyer’s one. While your practice may have a certain monetary worth, the likelihood of finding someone who will pay that price is decreasing over time. This means the buyer can set more of the terms and conditions that you may have to comply with to sell your practice at all.
Getting Help Selling Your Urgent Care Practice
Does this sound daunting? It isn’t all bad news. If you prepare properly and get your urgent care practice ready to sell, the market is still viable. How are you going to do those things and run your practice?
This is where a business broker comes in. Hire a professional who will be part of a team that helps you prepare your practice to sell and helps you find the right buyer at the right time. Have questions? Ready to talk about selling your urgent care practice? Contact us here at Rogerson Business Services today to discover how we can help you.