Friday, April 27, 2012

Ownership... Arghhh!

Good Friday to you. Hope you have had a great week.

My father and I are putting the final touches on the "hostile takeover." Some people will call it my buying him out. Things have been going pretty smoothly, but the minute details are maddening. My father and I have always done things a bit differently. A conversation between us might go something like this:

"Hey, you wanna buy the rest of the practice?"
"Uh, okay."
"Okay, done."
"Uh, okay."
"Okay, done."

Then a week later:
"How much do you want for the practice?"
"How about X?"
"Uh, okay."
"Okay, done."

This is really how two dudes do things. I don't recommend it, because now we have to start talking about things like medical insurance for "an employee." What if this? What if that? How about if you? I think you need a professional to handle all this.

One thing that I have started thinking about is trading. I am not saying I do this, but what if one of his friends comes into the office? Can he work on his friend for free? Can he trade services?

What if (and I am not saying this is a real situation) he had an optometrist friend from the military? Say they met at McCoy Air Force Base in 1971, and since then my dad and our family have received eye care and got a professional discount of 100%. His family has received dental care for the same professional discount here. He is on a 3 month recall here and I think my father and his wife get eye care. I went to him once in 15 years. I would consider him my eye doctor but I don't have any issues so I don't go. (I know, I know I should go more often.)

I found out about their agreement when his office didn't charge me as I left. I wrote him a really nice note and told my dad about the service I got at his office. My dad then told me their relationship."OOOOOHHHHHHHHH!!!" I said.

I took one of my kids there last week and was charged, as I expected. So now the question becomes: what happens when my dad no longer owns the business? Do I have to tell this guy who hasn't paid for a dental cleaning in 40 years that it is time to buck up? What about all the other "arrangements" my father has?

And that is just one thing. Now that I will own everything, I have to change the credit cards to my name. The office card that we have now has 350,000 sky miles that are mine. And do I give him a credit card? (Totally off the subject, but I had a patient that came in today that has 1.8 MILLION sky miles. Wow! He could go on a first class overseas flight with his wife over 150 times.)

What about his lab? I am partial to my lab (no pun intended). Mainly, my fixed lab. I don't think his lab is nearly as good as mine. My guy is local and is around the office all the time. And his work is really nice.

What about vacations? I guess he gets none because he is basically an independent contractor. See what I mean about the details? And that is only what I could think of off the top of my head. Disability? No. Is he is the bonus pool like the other staff members? What about if he starts to have a crappy attitude? What if he starts talking down to patients? Well, it is my practice now and I have to police everything. Do I send him to the schools? Uh, no. Do I send him to Rotary?

I think my head is going to blow off. Thanks for listening.

Have a great weekend,



Anonymous said...

Keep it simple John. Your dad is now an associate. He has lost all his privileges an owner might come to expect. That is what you paid (I suspect overpaid) him for. All his former deals as owner with other patients are gone. He gets a vacation of length you determine and when if any but I think you have to be reasonable. And the list goes on. Oh and the staff will continue to think he's boss so there will be friction. Ultimately he will not take well to being second place there and within a short time he will be gone, discovering that dentistry as an associate is a pretty rough go. A pretty typical scenario here. Just plan for it. G

Anonymous said...

Or once all the paper work is done, he'll say "Been waiting for this day, it's all yours son" and head off to the world's golf courses -my dream anyway.

Unknown said...

Yes, you should hire your own attorney. Have him/her write the contracts with a "flavor" that favors you as buyer. Also be sure to include a reasonable "non-compete" despite their questionable enforceability. You need him to think twice about "opening a small three chair clinic just down the street" because his wife wants him out of the house two days each week.


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