Empowering Women in Chiropractic - Do You Need A License To Sell A Chiropractic Practice?

Click here to download the transcript.

Disclaimer: The following is an actual transcript. We do our best to make sure the transcript is as accurate as possible, however, it may contain spelling or grammatical errors.  We suggest you watch the video while reading the transcript.

Hey everybody. Thank you so much for being here. I wanna take a minute to thank ChiroSecure for sponsoring and hosting these events. Make sure to visit them online. Great products, great company, great people. I am Dr. Randi Ross. I'm the CEO of Premier Practice Consultants, and today I wanna bring some information to you that you're probably not thinking about sometimes until it's actually too late.

So I wanna talk about when you're either selling a practice or possibly even for a buyer. What I'm gonna talk about now is really important to get on your radar as you enter this process. So when you're selling a practice, what's really important to understand is that different buyers will have different requirements to meet state, possibly even federal regulations to acquire your particular business.

Click here for the best Chiropractic Malpractice Insurance

And what you should do as you enter into this journey of selling your practice is you should find out. From either your state board, possibly your state association a good healthcare attorney in your community, in your state. You should find out what licensing requirements there are for someone to acquire your practice.

Now, I all know we think that, okay. It's simple, do you have a chiropractic license in the state? For some states, that's enough. For some states, believe it or not. You don't even need that to be an owner, obviously not to render care. But there are many states that have very specific guidelines and regulations.

Get a Quick Quote and See What You Can Save

Okay, I'm gonna use the state that I live and work in the state of Florida, just as an example. Understand when you're outside of the state, I'm gonna use as an example. You are gonna need to find out what your regulations are, and I'm gonna actually use an example of certain acquisitions that we have either completed or we are in the process of to really give you a bird's eye understanding of why this is important.

So a lot of people today will buy a practice. You have a chiropractor, young doc, maybe at a school, a bunch of years been working for someone, and now they are going to look to venture out on their own. And you have to have the perfect practice for them to acquire. But maybe what they're doing to make it financially available to them is they're gonna partner with a family member.

Maybe it's a parent, maybe it's you know, a brother or a sibling or anyone, and that particular person is not a licensed healthcare provider for the state in which we're talking about. What that does is it creates certain requirements that don't exist. If that licensed Florida chiropractor was going to be a purchaser on his own.

So it's very important to understand that in that situation, that chiropractor, and it happened to be his brother, had to go through a few other steps. They had to apply for another layer of a specific kind of license through. The Department of Health in the state of Florida to be able to be owners of this healthcare clinic.

Sometimes they're called healthcare clinic licenses. That's a Florida thing. They're probably called something very similar in other states. Florida is also another state that for certain buyers, this is really important to understand because I know that this happens in many states. As investors become more and more popular and prominent in the buying field of chiropractic practices, you should understand upfront what their licensing requirements might be.

So for example, here in the state of Florida, there's something called aca, A CHA. Now, many people that buy companies that may come in to buy your clinic. May or may not need something called an ACA license. Now you might say, that has nothing to do with me. That's on them. The reason why understanding these certain state legislations and requirements and licensing and whatever other word we wanna use to identify them is important because they often take a lot of time.

So you need to know this about your buyer up front, so you know, okay, they're gonna go for this kind of license. It might take 90 days. They're gonna go for this kind of license. That might take 3, 4, 5, some of them even six months. You have to know that before you engage in any kind of legal contract, even if it's just a letter of intent.

You wanna know upfront what you're getting into, if you are taking your clinic off the market so that it's no longer available for sale because you've entered into certain legal documents, you don't wanna find out 45, 60 days in that they've now done their due diligence, you've opened your books, they've seen your whole business, and they're like, oh yeah, by the way, we need to apply for this certain kind of license and that's gonna take us six months.

No. I'm not saying that, a particular buyer would do that intentionally, but sometimes they don't even always understand what they need. So make it your job to understand in your state. As a seller, what a particular buyer is going to need and understand the different layers. If they're a licensed chiropractor in your state, is there anything else they require?

If they're a particular kind of. Partnership, a licensed chiropractor and someone that's not a licensed chiropractor or a licensed healthcare provider of any kind, what does that require? If it's a certain kind of investor, more of a corporate structure private equity, things of that nature, don't assume that they know everything that's gonna be required.

And again, you might say not my problem. I don't have to do that. But it becomes your problem if you spend three months negotiating a deal, and then it's all of a sudden, oh, by the way, we need another six months to get this kind of license that we need. So make it your job, make it your responsibility to be informed about what any potential buyer for your practice would require.

And as a buyer, you should do the same thing. You should find out if I'm an individual buyer, here's what's required of me. If I'm partnering with someone that is a healthcare provider, or do they fall within the scope of that particular kind of license needed? If they're not, if they're just, your mom, your dad, your brother who don't have anything to do with the profession, what do you need to do if you are engaging in a potential acquisition?

With private equity or with any kind of investor group, understand what's the structure of that investor group early on in the process so that you can check with your local and state associations and boards and make sure you understand what's going to be required of them. I can tell you this has become a bigger and bigger piece of the puzzle.

That's why I'm bringing it to you. We have had opportunities that actually the deals fell apart because of these things were unknown. And the other thing that sometimes happens again is you get all excited. We've gone, 2, 3, 4 months, we've done our due diligence, we've opened our books.

Everybody's happy rah. We have a deal that everyone likes. And then it's oh, but by the way, it's gonna take six more months. You should know that from day one. And again, don't wait for anyone to tell you what the necessary requirements are. This is something that you can easily find out on your own.

I am Dr. Randi Ross. Anything you'd like to know about me? My company, premier Practice Consultants. You can find me anywhere online, any social media platform. And I'm happy to get on the phone with anyone if you have a question about this topic or anything else that we have discussed over time.

I'd like to also thank ChiroSecure once again for being the generous sponsors and being able to bring this information to you.

Click here for the best Chiropractic Malpractice Insurance

Get a Quick Quote and See What You Can Save