March 2, 2021
If you are a doctor, dentist, or veterinarian, you’ve gone through the arduous process of obtaining an undergraduate degree and the ongoing to an additional four years to earn the title “Doctor.” Even upon completing academic requirements, you’ve likely been required to complete years of further training before you can go out on your own. Now that you’ve spent years training and preparing for a career in healthcare and you’ve decided to open your own practice, you’re hit with a question: Should I buy an existing practice, or should I open a new practice? There are many things to consider when deciding whether to open a new practice or buy an existing one, and it may seem complex and stress-inducing. Once a decision is made, you then have further considerations, including selecting the entity to purchase or the type of organizational structure you’d like to operate, real-estate agreements, and employment matters.
Additionally, healthcare practitioners are subject to strict rules and regulations when establishing a practice. These regulations govern many things, such as who can own a practice, how the practice must be named, where the practice can be located and operate, and the types of business arrangements the owners of a practice can have with others.
Whether you decide to buy an existing practice or form a new one, a business attorney with experience in medical, dental, and veterinarian businesses can offer advice based on your situation. The attorney can provide legal advice to help you understand the risks involved in operating these businesses and the federal and state laws that govern healthcare practices. The team at McClanahan Powers, PLLC is available to help doctors in Virginia and the Washington D.C. area who are considering starting their own practice or buying an existing practice.
The process of purchasing a healthcare practice can be complicated, and trying to complete the process on your own may prove to be inefficient to your goals. There are multiple steps involved with purchasing an existing medical, dental, or veterinarian practice, including:
When forming a new medical, dental, or veterinarian practice, the advice of an attorney is highly advisable as setting up your practice in certain ways can affect your future profits. Additionally, the advice of an attorney can help you understand what legal documents are required, such as the Articles of Incorporation or a partnership agreement, depending on the structure you choose.
When you decide to form a new healthcare practice, you will likely consider some factors involved in buying an existing practice. However, there may be slight differences in your considerations. For example, will you buy a property and build, buy an existing building, or lease commercial space? These all necessitate an attorney to draft any agreements as to the purchase or lease of the real estate.
A major decision in forming a new practice includes picking your organizational structure or what type of business entity you’d like to open. The business structure will affect your taxes as well as your personal liabilities for debts.
Many professionals like doctors, dentists, and veterinarians choose to form a professional corporation. In a professional corporation, the owners perform services as employees of the business. One important note regarding the corporation is that the name of the business must include the words “Professional Corporation” or “P.C.” Professionals may also choose to open a professional limited liability company which may protect the members from personal liability claims for financial debts. If you choose to open your practice under this structure, the name should include “Professional Liability Company” or PLLC.”
Whether you decide to buy an existing medical, dental, or veterinarian practice or open your own, the business attorneys of McClanahan Powers, PLLC are here to guide you through the process and answer your questions. Call 703-520-1326 or visit our website to consult with an attorney today.