Just as in the 1990s, there is a wave of consolidation in the health-care industry today that is affecting both the perception and the reality of physician practice value. In many cases, the economics of today’s transactions are similar to the ’90s and that does not bode well for the future. At the end of that decade, many of the acquisitions proved to be disastrous financially to the hospitals and both private and public equity purchasers, resulting in divestiture of the practices.
The legal community may seek an appraisal or valuation of a physician practice for many different purposes, including marital dissolution, acquisition by a hospital, sale of an interest to another physician or in a commercial litigation context where damages are being sought. Regardless of the reason for the valuation, there are certain fundamental elements that must be considered by the appraiser.
