Most medical practitioners will be approached to join a practice at some point in their careers. While flattering, it’s not a decision to be taken lightly.
Joining a practice is in some ways like getting married. The ‘dating period’ is the time you’ve already spent there, getting to know your colleagues and the workings of the business.
Then comes ‘the proposal’ and you realise you’re being asked to make a serious commitment.
But before you put ink to paper, you’d better do some due diligence to determine if you can live together ‘in sickness and in health’!
We’ve compiled this checklist to help you familiarise yourself with the key issues you need to understand in order to make an informed decision.
Structure of the practice
Is it an associateship arrangement, a company setup, a partnership or a sole trader and trust structure?
This is crucial to understanding not only how you’ll receive your income but also what potential liabilities you might be exposing yourself to.
Professional insurances
Are these in place?
Buy/Sell Agreement
This is a critical document once you have bought in as it will essentially proscribe how to deal with each other, performance criteria, how you might leave the practice and on what terms.
Cross insurances
Are these in place?
Directorship obligations
Check whether there are any legislative requirements such as Director obligations under Corporations Law.
Medical Equipment
Check the value, standard and age of all equipment.
Lease, rent and finance agreements.
Check the extent and nature of current financial commitments.
Medical software.
Is it server or cloud based? What are the associated costs?
Current employee entitlements.
Check whether key staff members are staying and the extent of staff entitlements.
Talk to an expert.
Like a marriage, getting into a practice is relatively easy. Getting out can lead to a world of pain. That’s why it pays to consult with an expert before you make a decision.