Over the past 25 years, I’ve worked with countless doctors in New York City, helping them navigate the complexities of selling their medical practices. As you approach retirement, it’s natural for your priorities to shift toward family, grandchildren, and travel. Many doctors also reduce their workload, opting to work part-time. While these changes are rewarding on a personal level, they can have a significant impact on your practice’s gross revenue—and ultimately, its value when it comes time to sell.
Having been part of so many successful transitions, I know that the key to selling your practice for the highest price lies in careful planning and consistent management. Here are five essential strategies to retain the value of your medical practice:
1. Maintain Consistent Gross Revenue
The valuation of your medical practice will primarily focus on the last three years of gross revenue. If your revenue dips during this period, so will the practice’s market value. To prevent this, consider hiring an associate or expanding services to sustain patient volume and billings. Even if you’re working fewer hours, keeping your revenue steady is crucial to maximizing your sale price.
2. Start Succession Planning Early
Early planning is one of the most effective ways to preserve and grow your practice’s value. Identify potential buyers or younger associates who might be interested in taking over. By mentoring them and involving them in the practice’s operations, you’ll ensure a seamless transition and build confidence in the continuity of patient care.
3. Optimize Operations and Financial Records
A well-organized practice is highly attractive to prospective buyers. Make sure your financial records are clear, accurate, and up-to-date. Streamline your billing processes and eliminate inefficiencies that could be reducing profitability. Demonstrating that your practice is professionally managed will significantly boost its appeal and value.
4. Retain Experienced Staff Members
Your staff is the backbone of your practice. Their experience and relationships with patients add tremendous value. Work to retain key team members by offering incentives or professional development opportunities. A stable and motivated staff will make your practice more desirable and reassure buyers of its continued success.
5. Balance Lifestyle Changes with Business Priorities
It’s tempting to scale back your involvement in the practice as you focus on family and travel, but doing so without a plan can negatively affect your revenue and patient retention. If you’re reducing your hours, hire support to maintain the same level of service and ensure patients continue to receive excellent care. Protecting your practice’s reputation is essential to securing top dollar.
Final Thoughts
Selling a medical practice is one of the most significant decisions of your career. By maintaining consistent revenue, streamlining operations, and retaining your team, you’ll set yourself up for a smooth and profitable transition. Remember, the valuation process will heavily consider the last three years of gross revenue, so it’s important to keep those numbers strong.
As someone who has spent over 25 years working closely with doctors in NYC to successfully sell their practices, I understand the challenges and opportunities involved. If you have questions or are considering selling your practice, I’m here to help. Contact me today to discuss your goals and how we can achieve the best outcome for your future.
