Making the decision to seek outside assistance in order to maximize the value of your practice is possibly a life/practice changing event. Choosing the right partner for such an endeavor is critical to achieving your desired outcome: Choose the right partner for your practice and the rewards can exceed your imagination, but choose the wrong partner and your practice life may become unbearable.
Today’s environment is rife with consultants, merger and acquisition professionals and investment bankers all professing to be the “right partner” for you and your practice; however, how do you know with any certainty that they are indeed appropriate for your particular situation? Below, are some of the principle reasons we believe ProMed is the right choice for you and the organization that you have worked so diligently to create.
Before creating ProMed, Rudy Manthei, D.O. developed a solo Ophthalmology practice in Henderson, Nevada into a fourteen physician group, encompassing nine clinic locations and a three operating room outpatient surgery center with combined annual revenues in excess of $14,000,000.
Dr. Manthei was the driving force, creator and principle manager of Nevada’s largest Ophthalmology/Optometry IPA/MSO. This organization consisted of four competing practices and generated net revenues of over $70,000,000 with negligible administrative costs. The IPA managed over 80,000 Medicare Advantage lives under a full risk-based contract and achieved physician reimbursement in excess of 100% of Medicare.
While most companies you interview will be willing to work with smaller practices, ProMed takes pride in specializing in representing them. We possess the practical and proven experience to create a network that will maximize the “Multiple” via organic and/or inorganic growth, and you will never be placed on the back burner, you are our priority.
ProMed is well versed in the in navigating the complexities and intricacies necessary to maximize EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization), developing a workable CIM (Confidential Information Memorandum) to create additional value and establishing a data room necessary for the secure exchange of information.
ProMed has current practical and valuable experience in choosing the appropriate PE (Private Equity) partners that are capable and willing to provide the practice appropriate funding, growth and cost saving initiatives, revenue enhancement strategies, patient and employee increased satisfaction techniques, while reducing the work day stress for both providers and staff, and, most importantly, maintaining clear clinical separation.
ProMed will assist you throughout the PE interview, including, but not limited to the LOI’s (Letters of Intent), PE reduction to final offer (IOI), the selection of a PE partner and Quality of Earnings and Revenue Cycle Management Review. ProMed will further assist you in the Equity Partnership Agreement, the Employee Agreement and the Escrow Agreement, as well as the determination of tax basis, i.e., Capital Gains vs. Personal and due diligence and the process timeline.
To summarize, Dr. Manthei has personally experienced the entire Private Equity process vis a vis his own practice, transforming a $14,000,000 single entity with a likely multiple of five to six into a networked IPA/MSO made up of four entities and a platform practice with over $70,000,000 in revenue and a multiple of eleven. As a fellow physician, he has a fundamental understanding of the challenges and pitfalls that you will face, and most importantly he will match you and your practice with the appropriate Private Equity Partner to attain your particular goals. As Dr. Manthei points out to every client, the highest initial offer may not be the best price, the terms of the PE Agreement and a partner you can work with are the keys to the long term success of the venture.