This article briefly outlines 17 questions to ask that should help drive the decision as to whether to sell your ASC and how well it will do in a sale process. Obviously, it requires more analysis than this, but this is a great starting point.
1. Is the ASC’s income sustainable?
2. Is the income going up or down?
3. Is the center over-reliant on a few surgeons?
4. Are key surgeons close to retirement, or are surgeons leaving?
5. Is there a strong group practice connected to the surgery center?
6. Is that group practice growing or getting smaller?
7. Are there potential surgeons to invest in the surgery center that are independent? Is there a viable plan for succession and for adding surgeons to the center?
8. Is the reimbursement of the center per procedure or case generally sustainable or at great risk?
9. Does the center rely on out-of-network reimbursements?
10. Does the center rely on workers' compensation?
11. Are the center's core commercial carriers willing to negotiate contracts with the center at reasonable prices?
12. On a personal level, is the center a small portion of the surgeon’s portfolio or his or her entire portfolio?
13. Does the physician need the proceeds from a sale to secure his or her retirement?
14. What are the after-tax proceeds of a sale versus the after tax proceeds of distributions over the next five or seven years? Are returns sustainable for five to seven years?
15. Where will the surgeon invest the money if he or she sells?
16. Will a partner help the center’s profitability or simply provide a cash-out event?
17. What price will the center gain in a sale process? What percentage of the center would be sold?
For more information, please contact Scott Becker at 312-750-6016 or at sbecker@mcguirewoods.com.
1. Is the ASC’s income sustainable?
2. Is the income going up or down?
3. Is the center over-reliant on a few surgeons?
4. Are key surgeons close to retirement, or are surgeons leaving?
5. Is there a strong group practice connected to the surgery center?
6. Is that group practice growing or getting smaller?
7. Are there potential surgeons to invest in the surgery center that are independent? Is there a viable plan for succession and for adding surgeons to the center?
8. Is the reimbursement of the center per procedure or case generally sustainable or at great risk?
9. Does the center rely on out-of-network reimbursements?
10. Does the center rely on workers' compensation?
11. Are the center's core commercial carriers willing to negotiate contracts with the center at reasonable prices?
12. On a personal level, is the center a small portion of the surgeon’s portfolio or his or her entire portfolio?
13. Does the physician need the proceeds from a sale to secure his or her retirement?
14. What are the after-tax proceeds of a sale versus the after tax proceeds of distributions over the next five or seven years? Are returns sustainable for five to seven years?
15. Where will the surgeon invest the money if he or she sells?
16. Will a partner help the center’s profitability or simply provide a cash-out event?
17. What price will the center gain in a sale process? What percentage of the center would be sold?
For more information, please contact Scott Becker at 312-750-6016 or at sbecker@mcguirewoods.com.