In last month’s newsletter we introduced two types of companies typically utilized when
asset inventory and appraisal services are needed for a hospital or medical practice acquisition. It’s important to note that Business Valuation Firms and Capital Equipment Valuation Firms offer different approaches when appraising hard assets.
Capital equipment appraisers utilize an installed, in use methodology when appraising assets. Fair market values are market based and supported by current market conditions. This approach provides the most comprehensive view of an asset’s true value at the time of appraisal. Many business valuation firms rely on depreciation or formula based appraisals
to establish the most reasonable value that can be determined with the information provided by the client. This information might include an asset inventory provided by the practice manager or invoices showing what original purchase costs were.
Benefits of incorporating a capital evaluation firm into your overall business valuation process:
Onsite audits are performed for hard assets; i.e. medical equipment, furniture, IT and business-related equipment
Demographics of each asset are captured during the onsite visit
Condition assessments are provided outlining market viability and assets that may need replacement once the acquisition is completed
Turnaround time for deliverables are much quicker since capital valuation firms are asset specific in their approach
Costs associated with capital valuation firms are a fraction of what business valuation firms would charge for the same scope of work
In many cases, both types of firms can work together to achieve a best result solution for the client. It’s not uncommon for a healthcare provider to utilize both firms or a business valuation firm to subcontract a capital valuation firm to appraise the hard assets on the property. Hard assets play a significant role when evaluating a business acquisition and should be a high priority during the due diligence process.
Mark your calendars and be sure to look for Manage Resource Group, Inc. at the upcoming AHRMM trade show July 28 – 31 in SanDiego! Be sure to visit us at booth # 622. Click here for more information: www.ahrmm.org
City officials announced this week that Cleveland’s Medical Mart has been renamed to the Global Center for Health and Innovation. The facility is due to open this fall and has named several tenants including the Cleveland Clinic, University Hospitals, Johnson Controls, Philips Healthcare, and GE Healthcare. Just this week, Healthcare Information and Management Systems Society, or HIMSS committed to lease 12,500 square feet inside the Innovation Center.
This is a very exciting time for Cleveland and for all local healthcare-related companies like Manage Resource Group, Inc. as upcoming events planned for the Innovation Center will showcase the success of area businesses in the community.
Cleveland Clinic is planning to open the downtown facility on October 12th, with its Medical Innovation Summit, which has gained international attention. The topic for the event is obesity and diabetes and is expected to draw well over one thousand participants. Click the link below for more information on Cleveland’s upcoming Innovation Center: http://www.crainscleveland.com/article/20130219/FREE/130219810/0/FRONTPAGE
Is your organization maximizing returns on capital purchases? Idle assets may be costing you money when they can potentially generate money.
Idle assets tie up valuable storage space, depreciate in value each day they sit idle, and may be costing the facility money if still on the operating ledger.
Look to the experienced staff of Manage Resource Group, Inc. to provide a solution for idle assets. Our team of professionals have helped many clients obtain the highest possible return on capital assets including all modalities of movable medical devices and imaging equipment.
MRG can help:
Identify FMV for your assets
Pay top dollar for your surplus equipment
Coordinate pick up with no shipping/handling/storage fees
If you are currently storing idle assets, give MRG a call, and our team would be happy to review any available assets. You can also email equipment lists to firstname.lastname@example.org and a representative will contact you to discuss potential revenue returns.
In 2007, the Cleveland Catholic Diocese experienced a number of changes that affected many churches in Northeast Ohio. In order to prevent underperforming neighborhood churches from closing their doors to their loyal parishioners, the diocese chose to ‘cluster’ several of the parishes together to form one alliance between 3-4 churches and parishes to unite the communities and share services. Cluster planning intended to serve several purposes – share common visions, strategies and resources. The clustering helped to enhance the vibrancy of the parishes, continue to maintain and grow a strong Catholic presence in the community, and financially enabled continued growth; rather than forcing an underperforming church to close.
Hospitals are now experiencing the very same challenges. Studies predict that hospitals will expect to see a 20-25% decrease in revenue over the next decade. What will happen to smaller hospitals that are already suffering financially? It will become more and more difficult for many stand-alone facilities to deliver the high quality care that is expected. Over the next 10 years, plans for “bundling,” between hospitals and healthcare systems, and an increase in mergers are inevitable as facilities are forced to collaborate to continue their services.