As a new or nearly new practitioner, purchasing an existing practice may be the very best way to get up and running in practice.

As a retiring practitioner, you would ideally want to profit from the years that you have spent building up your practice.  You also want to ensure continuity of care for your patients.

As expected, the prospective purchasing practitioner and prospective selling practitioner have different financial agendas.  The one thing they have in common is the desire to make the transition as smooth and seamless as possible for the staff and patients.

In terms of what to pay or what to ask for a practice, there are no hard and fast rules.  Generally, the seller will receive cash up front for the “hard assets” of the practice, things like the furniture and equipment.  The buyer usually will have little trouble financing this  part of the purchase.  The price put on the various items in the practice’s inventory should be “market value”, the price that the item would fetch in the open market at point of sale as opposed to “book value” or “replacement value”, neither of which are particularly useful gauges of the worth of the inventory.

“Goodwill” is almost always the most contentious issue between the parties.  There is no “formula” that one can use that will arrive at a fair value.  Its worth is dependent on a variety of largely subjective factors.  To complicate matters further, lending institutions are reluctant to make appreciable goodwill loans.  Many practitioners get around these problems by agreeing to a financing arrangement whereby the purchaser pays goodwill over an extended period of time and sometimes contingent on how the practice does after the transition.

The role of lawyers in the process is minimal but extremely important.  There is probably no need for either practitioner to enlist the aid of a lawyer in the negotiation process.  However, once a deal has been achieved, it is imperative that a binding contract be properly drafted to ensure that each side understands its responsibilities.  The general rule of thumb is that the seller’s lawyer will draft the contract.  The buyer will then have his or her lawyer peruse and edit the documents.  A final copy that protects the interest of both parties is then achieved.

If the parties reach a sticking point in their negotiations, they may want to consider hiring a professional mediator to assist them in the process.  A mediator, often legally trained, facilitates the negotiation process by acting as a neutral “sounding board” for each party.

As a chiropractor, I have both purchased and sold practices.  I am a big fan of purchasing as a means of getting up and running.  However, both as a buyer and a seller, it is import to proceed with caution and get everything in writing!

Dealing with any insurance company can be difficult.  Dealing with an auto insurance company that is the largest and most powerful in Canada with an absolute monopoly in this province and over four billion dollars in its bank account is daunting at the best of times.

Insurance companies are not in the business of handing out money.  In fact, they make their profit by the “spread” between what they collect from premiums and what they pay out in claims.  None of this is news to you.  So you shouldn’t be surprised when ICBC adjustors refuse to honour your patient’s bodily injury claims, prematurely cut off benefits or play a variety of the games that they play so well.

First of all, do not tolerate a lack of respect from an ICBC adjuster.  If you are disrespected, speak to the adjustor’s manager and demand an apology in writing.  If you get no satisfaction from this route, go directly to ICBC’s head office in North Vancouver.

Secondly, keep yourself up to date with the latest medical and epidemiological research.  Whiplash associated disorders (WAD) are features of most motor vehicle accidents treated by natural health care professionals.  Adjusters will quote conclusions, often out of context, from the Quebec Task Force Report (QTF) and similar insurance industry promoted reports and papers.  These reports regard whiplash as a benign, harmless condition, from which patients recover in six to eight weeks, regardless of what treatment they receive.  You should be completely familiar with these reports and with the wealth of papers and studies out there that refuse the QTF and similar reports.  Michael Freeman and Arthur Croft, out of California, and Harold Merskey and Jim Teasell out of the University of Western Ontario in London are at the leading edge of the anti-QTF research.

If your patient’s care is denied or prematurely cut off by ICBC and you cannot convince the adjuster to change his or her mind, then focus your attention on the patient’s needs.  Your patient still needs your care, regardless of whether or not it will be covered by ICBC.  In terms of funding for that case, look to the patient’s resources first.  He or she may have coverage under an employment plan.  Failing that, the patient may have sufficient personal resources to pay for your services.  If these sources fail, look next to the patient’s lawyer.  At Cowley & Company, we have a formal reimbursement plan (“FastPay”).  Other law firms may make informal arrangements to pay for your client’s treatments in advance.  If all else fails, you may have to run the patient’s account and hope for reimbursement when the patient’s legal case is settled or adjudicated at trial.  Incidentally, at the point at which your patient’s care is denied by ICBC, he or she needs a lawyer’s assistance.

In any event, do not give in to the ICBC adjuster by terminating your care of the patient in the event that ICBC pulls the plug.  That merely plays into his or her hands.  It confirms for them that their decision to discontinue coverage was the correct decision.

Encourage your patient to take legal action when their  rights to coverage are violated.  It is only when ICBC is inundated with these types of lawsuits that it may consider modifying its corporate policy that devalues natural health care for auto accident victims.