FINANCIAL RECORDS: FIRST AND FOREMOST
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I received all the financial documents applicable to the practice I am
considering buying
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I received an explanation as to any item I do not understand on the
financial documents
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INSURANCE COMPOSITION OF THE DENTAL PRACTICE
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I received a complete list of all insurance plans the practice accepts
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I received a fee schedule for all the insurance plans the practice
accepts
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I inquired about the transferability of the insurance plans the selling
doctor accepts
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I received an exact breakdown of the insurance composition of the
dental practice, based on collections
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I received an exact breakdown of the insurance composition of the
dental practice, based on collections
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I know that I cannot legally use any other doctor’s Denti-Cal provider
number and that it generally takes about 8 weeks after the sale close
to obtain my own number
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I received a copy of all the advertising the selling office utilizes
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I received a copy of any on-going advertising contracts that I would
have to assume
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I know the exact cost of all advertising and have a copy of those bills
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I received a new patient list, breaking down the number of new
patients/month and year
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I know exactly where the new patients are coming from
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I examined a demographic zip code list of patients
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I examined a representative number of patient charts, and I chose
those charts myself
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I examined the x-rays, compared those with the treatment plan and the
progress notes
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I compared the progress notes with treatment actually billed to the
insurance company
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I examined the treatment plans to be certain I could provide that type
of dentistry
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I examined the financial arrangements on the patients whose charts I
selected
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I read the progress notes to determine their accuracy and
completeness
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I looked at cities/areas the patients were coming from, to determine
whether the patients would likely return
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I have carefully examined the patient schedule, both for past and
future appointments
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I noticed whether a scheduling system is used, or names are just
“thrown” on the page
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I noticed how long hygiene is booked in advance
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I noticed how long hygiene appointments are, and whether I agree with
that philosophy
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PATIENTS AND PATIENT COMMUNICATION
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I observed the doctor work for at least a few hours (not always
possible, but ask!)
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I looked at the practice’s website, if any
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I examined any patient newsletters, or other forms of communication
sent to patients
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FEES/FINANCIAL ARRANGEMENTS
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I have received a copy of all the dental practice’s fee schedules
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I know when the selling dentist last increased his/her fees
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I have examined the financial arrangement documents and procedures
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I know what financing options the practice provides
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I have an inventory of what exactly is being sold, and what is excluded
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I thoroughly examined all the dental and office equipment
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I know the age of all the dental and office equipment
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I know what the dental computer software is, its age and whether it has
been updated
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I have received information regarding each staff member’s pay,
benefits, hours, licenses, length of time with the practice, probability of
staying with the practice.
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I have received the DE-6 for the last completed calendar year
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I have received a copy of the W-2 forms for each employee for the last
calendar year
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I have received a copy of the quarterly payroll reports, for the last
completed quarter
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I have examined the practice’s personnel manual
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I have met the staff (may not be feasible until the contracts are signed
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I received a comprehensive accounts receivable report, showing aged
money owed
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I noted carefully the amounts owed by individual patients
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I asked whether co-pays and deductibles are routinely collected
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I asked whether the seller is a member of any particular group,
religion, organization or other entity that accounts for 10% or more of
his/her patients
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I asked the seller whether 10% of his patients or more are of any
particular group, religion, organization or entity
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I asked the selling dentists what his/her future plans are and asked
whether he/she was willing to warrant and guarantee all the
information he has provided me in the final sales contract, knowing
that information is forming the basis of my decision to buy the practice
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I asked the seller whether a management consultant has been utilized
and, if yes, I contacted that person and discussed the practice with
him/her. I asked the fee for that person.
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I asked the seller whether any particular management style or
program is utilized, and, if yes, I thought about whether I agree with
that style and would want to continue it.
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endodontic system, perio program, etc.)endodontic system, perio
program, etc.)
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I understand that I must hire appropriate professionals to advise me,
but that I cannot rely solely on my attorneys, accountants and
consultants, who rarely actually visit the selling practice.
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I understand that I cannot rely completely on what the selling doctor
and/or broker is telling me: I must independently verify all information
and I must insist that the selling doctor warrant and guarantee in the
final sales contract any information that is not verifiable (such as a
seller’s future plans).
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I must be certain that anything the selling doctor or the broker told me
that I relied on to make my decision to purchase the practice is
included in the final sales contract.
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I understand that I must use my own common sense and good
judgment!
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I must pay attention to any ‘red flags’ or bad feelings in the pit of my
stomach, all the way up to the close date! See list of RED FLAGS!
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I must thoroughly read, understand and agree to everything before I
sign it!
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I understand that the law will not generally help me very much if I make
a bad decision: the time to make a good decision is before the close
date!
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I understand that I should buy a practice that is very close to what I
ideally want: I understand that practices are very hard to change!
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