What Is an MSO?
Now that most patients want more from their doctors than traditional medical treatment, med spas have become the natural evolution of cosmetic medicine.
As a result, more and more plastic surgery physicians engage in this hot new phenomenon to be where the real action is.
Since the global medical spa market is expected to grow by $31.5 billion by 2025, MSOs backed by private equity firms are eager to partner with owners of established plastic surgery practices with medical spas for sale.
Are you an owner of a multi-location plastic surgery practice or medical spa business? If you’re planning your exit and growth transition, you should consider transitioning into an MSO.
What Multi-location Plastic Surgery Physicians and Medical Spa Business Owners Should Know About MSOs
What Exactly Is an MSO?
Medical Support Organizations (MSOs) are healthcare-specific administrative and management engines owned by non-physicians, physicians, corporate entities, or a combination.
What Services Do They Offer?
MSOs generally provide a wide range of back-office business management services to support medical practices. In other words, they run the administrative end while the physician runs the medical end.
When you merge your practice with a private equity-backed MSO, you’ll have someone to assist you in the following areas:
Physician Recruitment
Human Resources and Personnel Support
Staff Training and Education
Financial Management
Operational Concerns
Coding, Billing, and Collection Issues
Telecommunications and Information Technology
Discounts and Provisions of electronic health records (EHR) and Medical Equipment
Savings with Group Purchasing
Marketing
Professional and General Liability Insurance
Credentialing and Contract Management
Regulatory Compliance Management
Hazardous Waste Disposal
Electricity and Utilities
Janitorial Services
What Are Private-Equity-Backed MSOs Looking For?
PE-backed MSOs scope out large, established, and organized medical aesthetics practices that operate smoothly. Since plastic surgery practices with medical spas are essentially a service-oriented business, they look at indicators of how excellent the service is and how pampered the clients feel.
Above all, they want to ensure that the physician is someone they’re willing to negotiate with.
Besides the team structure and culture, they’ll also examine the financials.
For this reason, physicians should assess their financial situation by reviewing past revenues, cost of goods sold, and fixed costs, identifying costs that they can reduce, increasing their cash flow, and calculating their break-even number. Moreover, they should compare their numbers to industry standards.
The Industry Is Ripe for Medical Spas for Sale
Plastic surgery practices with established medical spas have become a primary niche target for private equity portfolio investment. While consolidation is gaining momentum in aesthetics, it’s important to note that strategic alignment goes far beyond the benefits of a private equity-backed exit or growth strategy.
When you join with the right MSO, you align with healthcare innovators who keep your interests at the forefront. Besides enjoying operational freedom as you plan your exit and growth transition, you’ll also be able to create value with investor backing and mitigate risks regardless of market disruptions.
If you want to ensure a smooth transition and a successful outcome, you’d want to engage a knowledgeable and well-connected M&A advisor to help you devise a smart deal structure to protect your legacy.
That’s where Viper Partners comes in. We are America’s leading M&A Advisory and full-service Investment Bank in aesthetics, representing plastic surgery physicians with established medical spas from contracting to the closing table.
We transact with highly capitalized MSOs, private equity firms, and family offices to get you the best deals and the biggest offers.
Get in touch with us today to schedule your free consultation!