The number of physicians under group management continues to grow, but many physician practice aquisitions are unprofitable, especially when hospitals are the buyers. A study of 460 physician practice acquisitions made during 1994-1996 looks at the factors that influenced acquisition profitability. The report, by Center for Healthcare Industry Performance Studies, covers more than 1,200 physicians from various specialties.
The chart (clockwise from top left) shows the relationship of goodwill to historical revenues per physician, average physician base salary in acquired practices, profitability of physicians in acquired practices, percentage of physician contracts with performance incentives, salary quarantees for hospital and nonhospital purchasers and kinds of firms purchasing practices.
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