What Does a Dental Practice Acquisition Lawyer Do?

A dental practice acquisition lawyer serves as a specialized legal advisor who guides dentists through the complex process of buying or selling a dental practice. Their expertise encompasses a wide range of services that extend beyond basic contract drafting.

These attorneys conduct thorough due diligence investigations to uncover potential legal issues with the practice being purchased, including examining existing contracts, employment agreements, lease terms, insurance participation agreements, and potential liabilities. They also evaluate regulatory compliance to ensure the practice meets all dental board regulations, HIPAA requirements, OSHA standards, and other healthcare laws.

Additionally, dental practice acquisition lawyers structure transactions to optimize tax benefits and minimize liability exposure for their clients. They can advise on whether an asset purchase or stock purchase makes more sense based on the specific circumstances of the transaction and the client's goals.

The Dental Practice Acquisition Process

The acquisition process typically begins with a letter of intent (LOI) that outlines the basic terms of the proposed transaction. This non-binding document serves as a framework for the more detailed agreements that will follow and often includes provisions for confidentiality and exclusivity during negotiations.

Once the LOI is signed, the due diligence phase begins. During this critical period, the buyer's attorney investigates every aspect of the practice to verify its value and identify potential issues. This includes reviewing patient records, examining equipment leases, assessing real estate arrangements, analyzing accounts receivable, and evaluating staff contracts.

After due diligence is completed satisfactorily, the attorneys draft and negotiate the purchase agreement. This comprehensive document details every aspect of the transaction, including purchase price, payment terms, assets included, liabilities assumed, representations and warranties, and conditions for closing. The attorneys will also prepare ancillary documents such as bills of sale, assignment agreements, non-compete covenants, and transition service agreements.

Choosing the Right Dental Practice Acquisition Attorney

Selecting the right attorney for your dental practice acquisition is crucial to ensuring a smooth transaction. Look for lawyers with specific experience in dental practice transitions rather than general business attorneys. Mandelberg Law Group specializes in healthcare practice transitions and offers expertise in dental acquisitions specifically.

Experience matters significantly in this specialized field. Attorneys at ByrdAdatto bring decades of combined experience in dental practice transitions, understanding both the legal and business aspects of these transactions. Their team includes former dental practice owners who bring practical insights to the legal process.

Consider the attorney's network of professional connections as well. Firms like Nixon Williams maintain relationships with practice brokers, accountants, and dental-specific lenders who can facilitate various aspects of the transaction. This integrated approach often results in smoother transactions and better outcomes for clients.

Common Legal Issues in Dental Practice Acquisitions

Several legal challenges frequently arise during dental practice acquisitions that experienced attorneys help navigate. Patient record transfers must comply with HIPAA regulations and state privacy laws. Your attorney should implement proper protocols for transferring these records while maintaining confidentiality and obtaining necessary patient consents.

Employment matters present another significant challenge. Existing staff contracts, non-compete agreements, and benefits packages must be carefully reviewed. The buyer must decide whether to retain current employees and under what terms. Dental Boutique emphasizes the importance of clear communication with staff during transitions to maintain practice continuity and patient relationships.

Insurance credentialing creates potential revenue disruptions if not handled properly. Buyers must apply for credentialing with insurance providers well in advance of the closing date. Some insurances take months to process these applications, potentially leading to cash flow problems if not addressed early. Experienced attorneys coordinate with credentialing specialists to minimize these disruptions.

Lease assignments also require careful attention. Many dental practices operate in leased spaces, and these leases often contain clauses requiring landlord approval for assignments. Dental Economics notes that landlords sometimes use practice transitions as opportunities to renegotiate lease terms, potentially affecting the economics of the transaction.

Benefits of Specialized Legal Representation

Working with a specialized dental practice acquisition lawyer offers significant advantages over using general business attorneys. These specialists understand the unique aspects of dental practice valuation, including how to properly value patient goodwill, equipment, and the practice's reputation in the community.

They're familiar with dental-specific regulatory requirements that general business lawyers might overlook. For example, American Dental Association guidelines and state dental board regulations impose specific requirements on practice ownership and operation that must be addressed during transitions.

Specialized attorneys also understand the emotional aspects of practice transitions, particularly for selling dentists who have built their practices over decades. Henry Schein Dental recognizes that these transactions represent more than just business deals—they're the culmination of careers and the transition of patient relationships that have developed over years.

Perhaps most importantly, dental practice acquisition attorneys help structure transactions to protect both parties. They ensure proper representations and warranties in the purchase agreement, establish escrow arrangements to secure future obligations, and create transition plans that protect the practice's value during the critical post-sale period.

Conclusion

Selecting the right dental practice acquisition lawyer can make the difference between a smooth, profitable transition and a problematic one with lingering legal issues. These specialized attorneys bring knowledge of dental regulations, business valuation expertise, and transaction experience that general business lawyers typically lack. Whether you're buying your first practice, expanding to multiple locations, or preparing to sell after a long career, investing in proper legal representation is essential to protecting your interests and ensuring the practice's continued success. By working with attorneys who understand both the business and clinical aspects of dentistry, you position yourself for a successful transition that benefits all parties involved—seller, buyer, staff, and patients.

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This content was written by AI and reviewed by a human for quality and compliance.