While practicing in a partnership or group practice has its advantages, such as sharing management responsibilities, marketing duties and operational costs, there also can be a few drawbacks of a group practice. One of the biggest mistakes dentists make it not having a comprehensive agreement to manage the partnerships. If you are considering a 50/50 partnership, here are a few questions to ask yourself:
- Is your practice large enough patient base wise for two full-time doctors?
- Is the physical space larger enough for two doctors to work at the same time or will you be doing a split schedule?
- Is your business house (the practice systems, processes, etc.) in order?
- Is your personal house (any legal issues with either party such as pending divorce) in order?
- How long has the associate worked with you and are you comfortable with his/her practice style?
- Why did you hire the associate in the first place? Was it simply for coverage so you could cut back, or was it to have an in-house buyer when you are ready to retire?
- How does the associate’s patient base compare to yours? In other words has the associate been given insurance based patients and smaller/routine cases compared to your fee for service bigger ticket cases.
- Is the associate going to be a 50% owner immediately or over a period of years?
- As the original owner allowing a 50/50 partnership, are you willing to give up or share control of the practice you built?
- Is the associate capable or willing to take over any administrative duties you currently perform?
- Does the associate get along well with your staff and patients?
- Has the associate added to the growth of your practice?
- How will you share the new patients?
- Does the new doctor perform any procedures that the seller doesn’t and vice-versa?
For answers to these questions and others, contact our Dental CPA team at (800) 772-1065 or firstname.lastname@example.org