More complicated than you think – Valuing a medical practice
Abstract: A new wave of purchases of physician practices, mostly by hospitals, is taking place around the country. Because of their numbers, size and purchasing power, hospitals are currently defining the standards for valuing the practices they buy. A practice’s sale price is typically based on the value assigned to it by a professional appraiser when there’s a strategic buyer. The value is made up of the practice’s tangible assets, cash, accounts receivable and goodwill.