BV199-WEB - The Big Three in Healthcare: Buy-in/Buyout Agreements, Physician Compensation, and Private Equity "Market Data"

Registration

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Webinar Course Description

Valuation is part art and part science, but there is always a risk that some of the art may be lost or not understood. One of the more routine engagements an appraiser may encounter is to value a practice pursuant to a buy-in or buyout agreement, whether it be due to an expected retirement, death or disability, or marital dissolution where contract law is relevant. Such an engagement can be significantly more complex than appears on the surface. Use of physician compensation survey data is likely to distort the valuation as will failure to understand current "market data" from Private Equity deals.

Course Audience

The program is designed for experienced appraisers who want to understand the nuances of valuing physician practices, whether for a buy-in or buyout, marital dissolution or third party sale.

NASBA and Continuing Professional Education (CPE) Credit

The American Society of Appraisers is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of accountancy have the final authority on the acceptance of individual courses for CPE credit. Complaints regarding registered sponsors may be submitted to the National Registry of CPE Sponsors through its website www.learningmarket.org.

CPE Credit: (2) Hours in Specialized Knowledge
Program Level: Intermediate
Delivery Method: Group-internet based courses are approved for CPE
Prerequisites: None
Advanced Preparation: None
Policies: ASA's Refund and Cancellation Policy and ASA's Complaint Resolution Policy

Instructor Information

Mark O. Dietrich, CPA PC

Mark is a summa cum laude, Beta Gamma Sigma graduate of Boston University where he also earned an MBA with high honors. He is Editor and Contributing Author to the Business Valuation Resources/American Health Lawyers’ Association Guide to Healthcare Industry Finance and Valuation 4th Edition, Editor and Principal Author of BVR Guide to Physician Practice Valuation 3rd Edition; and co-editor and contributing author to the BVR/AHLA Guide to Valuing Physician Compensation and Healthcare Service Arrangements 2nd Edition. Mark served as Chairperson of the American Institute of CPA’s (AICPA) National Healthcare Industry Conference for 2012 and 2013.  Mark’s career experience includes working with numerous physician practices as a tax advisor, operational consultant, designing and implementing compensation plans, negotiating managed care and Medicare Advantage contracts on behalf of a primary care physician network, serving as partner-in-charge of the audit of a tax-exempt faculty group practice affiliated with a major teaching hospital, serving as expert on behalf of both defendants and the government in qui tam actions, and performing valuations on behalf of both medical practices and tax-exempt hospitals. When he is not writing or researching some obscure healthcare industry topic, he does valuation work and tends to his farm in Virginia.

Agenda

The following topics are covered in this course:

• Understanding Buy-in and Buyout Agreements and their impact on value;
• Different definitions of “fair market value” and whether any lack of control or marketability discounts are to be considered;
• Determining replacement compensation versus “profits” to be included in the valuation model;
• Assessing local market rates of compensation relevant to a practice located in that market - no more "survey says.";
• Evaluating whether and to what extent private equity “market” data is relevant; and
• Reconciling actual working capital to normal working capital.

Learning Outcomes

Upon completion of this course,students will be able to:

• Analyze how the terms of a shareholders’ agreement or operating agreement impact the level of value;
• Discuss how the local market of the practice determines the appropriate compensation normalization adjustments – just because it plays in Peoria does not mean it will play in Manhattan;
• Identify how Private Equity “Market” transactions reflect specific terms from the buyer that are rarely applicable in a given valuation engagement, but may influence perceived risk and the discount rate; and
• Decipher unique elements to consider in reconciling actual and normal working capital – and what is “normal” anyway?