A dialysis center is a type of facility which offers life support service for patients suffering from lost kidney function. Dialysis Centers can provide treatments to patients at a free-standing facility or at the patient’s home. Additionally, Dialysis Centers may be operated as a hospital department.
Dialysis Centers are typically valued for the sale to or from a national / regional operator, or a hospital operator. Additionally, Dialysis Clinics can be valued for individual physician investment.
The appraiser must understand many industry specific factors when valuing a Dialysis Center. Key value drivers include, but are not limited to:
- Reimbursement: Typically, Medicare is the primary payor for the majority of a Dialysis Center’s patients, with a small percentage of patient’s insured by a commercial payor. Understanding the historical and reimbursement for each of these two groups is critical in the valuation process.
- Equipment Capacity and Capital Expenditures: The potential patient treatment volumes a Dialysis Center can accommodate is related to the number of dialysis machines available at the Dialysis Clinic. This relationship as well as the capital investments required to add or replace machines is important in a Dialysis Center valuation.
- Medication Costs: Medication costs are frequently the largest cost group for a Dialysis Center as each patient is required to receive a certain level of Medication for each treatment. Medication expenses will fluctuate directly with changes in patient treatment volumes, and therefore, the drivers of historical and projected Medication costs should be understood in the valuation.
There are many unique items to consider in the valuation of a Dialysis Clinic that necessitate a depth of knowledge and experience. VMG Health’s detailed experience with Dialysis Center valuations gives you the confidence you need to complete your transaction.
Relevant Publications on Dialysis Centers
Vascular Access Center Valuation Considerations in 2017