COVID-19 Impacts Medical Practices

There have been numerous articles, blogs, and news reports of COVID-19 and its accompanying impact on business of all types and sizes through out the U.S. It’s impact on the health care industry has been equally severe, especially on physician and medical practices. As appraisers of health care companies and medical equipment, we have seen it first-hand.

Over the past several years, there has been a substantial increase in the number of clinics either closing or merging with a larger practice or hospital company. An article in the May 7th issue of Medscape, pointed out that there has been a 20.8% increase in the number of practices merging or being acquired by another organization.

A recent article by FTI Consulting Inc. highlighted the issue of COVID-19 by pointing out that many small practices have been struggling for some time. COVID-19 shutdowns have exasperated their already high financial obligations and decreased cash flow. Stay at home orders shut down patient visits and practices have had to send their staffs home.

I spoke with Michael Moran of FTI regarding their article and what they’re seeing in the medical practice marketplace. They are witnessing the same thing. More practices will be shutting down or looking for an ownership partner. We’re getting more inquiries from physicians and medical practice administrators and it’s the beginning of a larger trend due to the COVID-19 pandemic.

Our company, Certified Asset Appraisals has provided inventory and appraisal services for businesses of all kinds but especially health care companies. We can assist in the merger and acquisition process with our inventory and valuation services. Our clients include large health care companies as well as small medical practices. All of them were looking to identify and value the fixed assets in their facilities that they operate. This process is also helpful for groups that are considering the acquisition of a practice.

If we can assist your company in any way, or if you would like to get more information about how we work, we would love to talk with you.