How to Sell a Psychiatry Solo Practice: Q & A

Hello Dr. Centore,

This is Dr. Smith from Long Island, NY. We have been playing phone tag for the last few days. Here is my practice information.

I am a child and adolescent psychiatrist. I am in solo part-time private practice, about 8-10 hours a week. I was part of a group practice and then left the practice last year and started solo. My patients have been with me for about 2 years now. I rent an office space. There is no lease.
It is a cash-only practice. I do not accept any insurances. My no-show rate is almost 0%. Collection rate is about 99%. Monthly revenue is about $10,000. My patients are children, adolescents and adults. Almost no elderly patients. Most of my patients are stable.

It is an ideal practice for someone to do part-time private practice. If someone wants to expand, it is quite easy. I get plenty of new-patient inquires but I have chosen to keep it part-time.

I will be available to help the transition phase. I am planning to relocate to Dallas, TX. Even after the transition, I could be available for any questions. If it is a recent graduate (I think it could be ideal for someone graduating from a training program), I could remain on board as a consultant for a few months. In short, I am flexible and committed to help out with the transition in whatever way I can.

Thank you for your help. Please let me know if you have any questions.

Regards,

Dr. Smith

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Greetings Dr Smith,

Thank you for your email, and sorry we haven’t been able to connect by phone.

Psychiatrists are in such short supply, very few are wanting for clients. Because of this, and because the moment you leave the practice you have built stops making any money (as you’re the only provider), the practice probably doesn’t have a high value in terms of a business sale. This isn’t to say it’s “worthless”–certainly not. The practice is very valuable to you, and to the people you service. It’s just that the value you have built isn’t easily transferred to a buyer. Another psychiatrist is really your only buyer, and right now—and for the foreseeable future—good licensed psychiatrists often have many lucrative employment, and even self-employment, options.

If you can find a psychiatrist to take over, the purchase value of your business would be the value of your hard assets (computers, furniture, etc,), and your business’ phone number. A total value, unless I’m missing an important detail, which I sincerely might be, would likely be under $25,000.

Please do feel free to keep trying to reaching me by phone, or just email me. I am happy to talk with you.

Finally, please know that this is just my opinion. I’m not giving legal advice, accounting advice, and I don’t warranty my opinion in anyway. How’s that for a disclaimer?
About Dallas, if you’re interested, I would love to talk with you about working at Thriveworks in Dallas. There would be some details to work out, but in general Thriveworks would take care of everything like the billing, scheduling, credentialing, office space (our spaces are beautiful, like nothing else in the field), advertising, and everything else…and you’d be able to just see patients. It is a very lucrative role for psychiatrists, with also a very nice lifestyle. Do you see how very rare and valuable persons in your profession are? I barely know you and I’m trying to recruit you to join my team.
While it will make it easy for you to land on your feet when you relocate, such will make it more difficult to sell your practice. A double-edged sword, I guess.

Be well,

Anthony