What drives the value of dialysis clinics?

While dialysis clinics can be a lucrative business, they represent a complex challenge in terms of determining their value. These entities are highly regulated, dependent on a variety of patient reimbursement models, and at the mercy of their patient mix, geographic location, and relationship with local nephrology practices.

James Lloyd (Pershing Yoakley & Associates P.C), a healthcare valuation expert, gave his insights into what he sees as some of the key value considerations for dialysis clinics:

Community demographics: Speaking during a webinar, Lloyd pointed out how difficult it is to increase growth once the dialysis center is up and running and has achieved a level of maturity. “It is very difficult to grow volume more than the amount of growth in the actual community and the average age of the population in the community,” he says.

Relationship with area nephrologists: Dialysis centers are very dependent upon the relationships with local nephrologists. “That is where the referrals—and patient oversight—comes from,” he says. “That is very critical.” Important considerations are the number of nephrologists in the area and whether there is more than one group or multiple groups. Also important is whether they are currently aligned with another provider of dialysis centers.

For other value considerations, see the March issue of the Healthcare Value Wire (free registration required). For an archive of the webinar Valuing Dialysis Clinics, click here.