The buy-in should reflect the buy-out. If a doctor runs errands with $X a medical group, the group must buy the doctor at the same $X. In other words, you should use the same formula to determine both the purchase price of a doctor for the shares of a practice and the purchase price of the doctor when leaving the office. The reason for the rule is fairness. Neither the practice nor the doctor should have any gales with the buy-in and the buy-out that follows. The buy-in structure is a critical element of the partnership agreement. These are important points to settle on buy-in: Action step Before accepting the financial terms of a buy-in, doctors should discuss these conditions with their accountant and relevant tax issues should be taken into consideration. Step action doctors should let their lawyer be the “bad guy”; They can always blame their lawyer. It is important for the physician to maintain good relationships with partners during the negotiation process, while ensuring that important issues are dealt with appropriately. Doctors come and go from medical groups. If a doctor enters a practice as a shareholder or partner, the practice must prepare for the doctor`s exit. The exit is inevitable. In this article, I give a simple rule for structuring the doctor buy-in to a practice and subsequently taking over the doctor`s shares of the practice.
As always, you can read other articles about buy-ins and buy-outs and buy-sell, in the Sidebar on the right. Look under the title “Partner and Shareholder Relations; Buy-sell. After you arrive, it usually takes another three to five years to complete a buy-in. A practice will not discourage you by making redemption payments phenomenally high, so it will distribute payments over time. But partners also won`t just want to give their practice, so you can expect to spend a decent portion of your income for buy-in. Above all, it is important to be sure that you get an equal voice as a partner while the buy-in process is complete. Keep advisors who can help you. “It`s worth having a lawyer who knows about the laws of this state,” says Alice G. Gosfield, a health lawyer in Philadelphia, JD. “Also, it`s worth having an accountant.
A doctor`s personal tax effects can be important. Partnership/share and enterprise agreements generally contain binding buy-back provisions. Often, new medical partners focus on their buy-in obligations and not on their corporate obligations (or obligations) to buy from existing partners in certain circumstances. How is the buyout funded? Are there cross-purchase life insurance on the life of partners to finance buybacks? How is the purchase price determined and how is it compared to the buy-in price? Sansweet advises: “As a young doctor, you should hire a health lawyer, accountant or medical expert – someone who is very competent and experienced in this area – to check the proposed feed-in price, to see if it is reasonable and reasonable.” However, he adds, paying for a separate assessment of the practice is generally not worth the effort or the money.