Hospital acquisition of a physician practice – the process

Written by Reed Tinsley | February 18, 2011

Based on my experience, the following is the typical process on how a hospital goes about acquiring a physician practice these days; is there anything you would add or revise?

  1. Sign Confidentiality Agreement
  2. Valuation of the Practice
  3. Due Diligence by all Parties
  4. Sign Letter of Intent (Non-Binding)
  5. Draft Documents and Negotiation
  6. Asset Purchase Agreement, Stock Purchase Agreement, or Merger Agreement
  7. Physician Employment Agreements
  8. Leases (with acquired group or third party parties)
  9. Obtain Hospital Board Approval (if necessary) and Physician Shareholder
  10. Approval
  11. Sign Transaction Documents
  12. Obtain third party assignments and consents
  13. Physician medical staff and payor credentialing
  14. Implementation

About the Author

Reed Tinsley CPA

This article is written by Reed Tinsley, a Houston, TX-based CPA with over 30 years of experience advising physicians and medical practices across Texas and the United States. Reed holds certifications as a Certified Valuation Analyst (CVA), Certified Healthcare Business Consultant (CHBC), and Certified Financial Planner (CFP), specializing exclusively in the healthcare sector. He is a published author, nationally recognized speaker, and trusted advisor to physicians on accounting & tax, practice management, and financial planning. Schedule a Free Consultation.

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