How to value a medical clinic: doctors, licences and insurers

A clinic is bought for its flow of patients and its team of doctors. That is why a valuation here depends on people and permits more than in other industries.

Dependence on doctors

If one or two doctors bring in most of the flow and their terms are not fixed in a contract, the buyer sees a risk: the doctor leaves and the patients go too. Contracts, limits on moving to competitors and spreading patients across doctors reduce that risk.

Licences and regulation

Medical activity in the UAE is regulated by the emirate’s health authority, so the buyer checks that the licences are valid, how they pass when ownership changes and whether the staffing and premises requirements are met.

Insurers and the payment mix

• what share of revenue goes through insurers and under which contracts;
• payment terms and the share of rejected claims;
• the share of self-paying patients without insurance.

Patient base and retention

The buyer wants to know how many patients come back, how they find you and whether there is clear record-keeping in a system rather than in the receptionist’s head.

Equipment and premises

• the condition and age of the equipment and the need to replace it;
• the lease terms and duration;
• consumables and suppliers.

What raises value

• a team of doctors on long contracts;
• diversified sources of patients;
• clear reporting and records by doctor and service;
• processes that do not depend on the owner.