Selling of Medical Practice: Arguments

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The decision to sell a practice may be a tough one to make and may take time to think about the short-term and long-term impact of the choice made. Organizations have viewed selling of practice as a strategy of prevailing in a competitive environment. The practice may take place where similar organizations offering similar services are located in the same area. The most powerful one may resolve to pay the others to work in the organization instead of running their private institutions. Several factors discussed in this study should be considered adequately before settling to sell on not sell a medical practice.

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Government Policies

One should have an in-depth understanding of the government policies relating to the practice. Selling a medical business to an institution may be accompanied by various policies formulated at state or federal levels to cover medical practitioners. The government policies may favor the conditions of physicians working in public hospitals or private healthcare facilities. For instance, one may be interested in selling the services after considering some of the government provisions for health-service providers. An example of such requirements includes better pay, including incentives, whereby half of the payment is given directly to the physician as salary. In contrast, the other half is used to improve the living conditions of the physician. Such a condition may entice one to accept selling the practice to an institution.

However, the deal may not be implementable due to financial constraints in the state. For instance, the government may be unable to raise salaries and benefits for the physicians. The contract may be terminated, leading to disappointment to the service provider, who might have closed a private business to concentrate fully on the employer institution. Unexpected termination of the contract would render the seller of services jobless without a source of income. An individual may decide to avoid the selling of practice if there is a doubt for the contract’s sustainability and continue operating a private business. Therefore, a clear understanding of government policies would help make up decisions relating to the selling of practice (Niknamian, 2019). Some states’ laws have illegalized the sale of private practices, while others may have well-laid procedures relating to the selling of practice.

Profitability of the Private Practice versus Selling it

The seller of the practice should also consider the profits likely to emerge from the private healthcare facility. Most private healthcare facilities are businesses that are aimed at making profits. Private institutions face stiff competition from public hospitals and healthcare (Ayers, 2019). Many benefits associated with public healthcare attract more individuals than in private healthcare. Such benefits may include insurance plans such as the government’s Medicare program to citizens and implemented in public healthcare. This trend results in a low number of customers visiting private healthcare, thus low profits. Additionally, the government taxation rates are higher in private healthcare compared to those imposed on public employees.

A practice seller should consider the profitability of private healthcare wisely, which is also highly taxed before selling or declining the selling of practice. The future may also be considered while assessing the customers’ factor since the government policies may influence more to divert their attention to public healthcare (Niknamian, 2019). However, the seller of practice can consider other factors that attract customers, such as the quality of services to ensure he retains them. Proper comparison between profits, taxes and other health factors in private healthcare would be crucial for deciding either to sell or not sell the practice.

The practice seller should also involve an experienced neutral financial consultant in the valuation of the practice. The valuation should be a comprehensive process incorporating many factors relating to individual benefits and losses. The practice seller’s value would be evaluated while the need of the buyer is also considered (Blachford, 2016). The valuation process may not be purely connected to an individual’s financial worth but also other factors such as professional experience, working conditions, and government regulations.

The Consultant’s Report

The seller can compare the consultant’s report with individual expectations before deciding whether to sell or not sell the practice. If the buyer’s compensation is worth the private service provider, and the working conditions favor the seller of the service, he may choose to sign the contract on selling the service. The consultant’s report may also indicate that the service seller’s value is very high compared to the compensation promised by the practice buyer. The service-seller may decline the buyer’s pledge and stick to the private business. The seller may also be impressed with the buyer’s other privileges while working in the hospital and choose to sell the practice.

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Terms of the Contract

The process of selling the practice would also require the seller and the buyer to have a thorough understanding of the contract terms. Therefore, there would be no need to rush the agreement process to create enough time for both parties to read, consult, and understand the contract’s terms and conditions (Blachford, 2016). The process should involve joint meetings to ensure there is consignment in areas where clarity from the other party is required. One critical factor to consider in signing the terms would be how to handle the possible risks in the new institution.

The seller and the buyer of the service should negotiate on the terms of operation to the satisfaction of one another. The practice-seller may opt to decline to sell the practice if he is not contented with the buyer’s provisions. Unfavorable terms may involve the seller in risk-sharing with the employer or those subjecting the seller’s life or property to risk. The decision can also be agreeing with the buyer’s terms and accepting to work for the organization. However, the seller’s decision should be free from influence or compulsion for effective delivery of services.

Formation of a Merger

The merger factor should also be considered before deciding on whether to sell a practice. The decision on merging a private health institution with another should be considered well since it involves benefits and risks to both the seller and the buyer of the practice. Some of the benefits include profits, improved quality of services, and division of roles, while the risks may involve losses incurred in the merger. The merger would have higher chances of expanding than a private institution due to improved quality of delivery, hence higher profits (Ayers, 2019). The idea of a merger would also ensure the seller of practice is neither underutilized nor overworked since it involves sharing of responsibilities. Therefore, the practice seller should consider working in a merger before deciding whether to sell or retain the practice.

The Individual’s Management Skills

The seller of practice would also be required to consider his management skills. However competent one may be in professional matters, lack of good managerial qualities would lead to a private business failure. One needs to be aware of daily activities in the organization, maintain a healthy relationship with employees and clients, control expenses and profits, and manage the organization’s resources (Ayers, 2019). Therefore, an individual with good management techniques would decline to sell the practice and run an individual business, while those doubting themselves may sell their practice.


Finally, selling of practice is an individual’s choice influenced by various factors. Some of the factors include government policies, terms of the contract, consultant’s report, management skills, sustainability of customers, among others. The factors may have higher benefits to either the seller or buyer of the practice, or both. One should choose the decision to retain or sell his practice after considering the factors keenly.

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Ayers, A. A. (2019). Practical considerations for buying/Selling your urgent care practice. Journal of Urgent Care Medicine. Web.

Blachford, P. (2016). What to consider when selling or buying your practice. Canadian Journal of Optometry, 78(2), 26. Web.

Niknamian, S. (2019). Identification of internal and external factors affecting the optimal implementation of government policies. OSF Preprint. Web.

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NursingBird. (2022) 'Selling of Medical Practice: Arguments'. 14 July.


NursingBird. 2022. "Selling of Medical Practice: Arguments." July 14, 2022.

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NursingBird. "Selling of Medical Practice: Arguments." July 14, 2022.