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Creating the Basis for an Employment Arrangement and Physician Group Acquisition
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Veralon Cases & Insights

Creating the Basis for an Employment Arrangement and Physician Group Acquisition

Client/Profile

Large inner-city community hospital in highly competitive environment

Challenge/Situation

To help the hospital understand the employment arrangements of an important physician group acquisition target, so that the hospital could create comparable employment arrangements with the physicians.

The physician group had extremely complex personal and professional accounting arrangements among themselves that created a barrier to productive discussions between the parties. Veralon’s role was to tease out those complexities and translate them into terms that the hospital as a future employer could understand.

Process

Veralon analyzed group and personal professional corporations (PCs) to construct a reclassified profit & loss statement. We also presented an “all-in” picture of historical compensation along with a relevant proposed compensation design.

Results

Deliverables included historical and restated practice, productivity, and compensation analyses. Once these were completed and reviewed by the physicians, the hospital and physicians were able to have a conversation about terms of compensation and acquisition using the same language.

Veralon also completed a tangible asset valuation in support of a practice acquisition.

Veralon’s analyses and presentations provided decision-making support to both the hospital and the physicians. A compensation plan was offered and accepted by the physicians and the group was acquired.