Buying a dental practice is both a professional milestone and a major business transaction. The clinical side matters, but the legal structure of the deal can determine whether the transition succeeds or becomes a costly dispute.

Most dental practice acquisitions are structured as asset purchases. The buyer purchases selected assets of the practice, such as equipment, supplies, patient records, goodwill, phone numbers, website rights, trade names, and sometimes accounts receivable. The purchase agreement should clearly define what is included, what is excluded, and what liabilities the buyer is not assuming.

Patient records require special attention. A buyer should understand how records will be transferred, how patients will be notified, who is responsible for record retention, and how privacy obligations will be handled. The goodwill of a dental practice depends heavily on patient continuity, so the transition plan should be practical and compliant.

Staff transition is another key issue. The buyer should know which employees will be offered positions, whether compensation or benefits will change, whether there are accrued vacation or bonus obligations, and whether any employment claims or wage issues exist. The purchase agreement should address who is responsible for pre-closing employment liabilities.

Restrictive covenants are central in dental deals. If the selling dentist is not restricted from opening nearby, soliciting patients, or hiring away staff, the buyer may not receive the goodwill they paid for. At the same time, restrictive covenants must be drafted carefully and reasonably under applicable law.

Equipment should not be treated as an afterthought. The agreement should identify major equipment, state whether it is owned or leased, disclose liens or financing, address warranties or disclaimers, and explain who is responsible for repairs discovered before closing.

Accounts receivable can also cause confusion. Some buyers purchase receivables, some collect them for the seller, and some exclude them entirely. The agreement should explain how payments will be allocated when patients owe amounts for work performed before and after closing.

The lease may be the biggest hidden issue. A dental practice usually depends on its location. The buyer should confirm whether the landlord must approve an assignment, whether the lease term is long enough, whether options can be exercised, and whether the landlord will require a personal guarantee.

Dentists should review the legal documents before the deal is too far down the road. Once financing, due diligence, and closing pressure build, it becomes harder to fix problems. A good purchase agreement should protect the buyer, support a smooth transition, and reduce the chance of disputes after closing.

Brenden Kelley Law helps dentists review, negotiate, and close dental practice purchase agreements, leases, employment documents, and transition-related contracts.

Additional legal and practical context

A dental practice purchase is not just the purchase of equipment and patient charts. It is the purchase of a going concern: goodwill, location, staff, systems, phone numbers, website presence, patient relationships, provider reputation, contracts, and cash flow. The legal documents should match that reality.

The asset purchase agreement should clearly identify what is being purchased and what is excluded. That includes dental chairs, imaging equipment, handpieces, computers, software, instruments, supplies, phone numbers, domain names, social media accounts, trade names, patient records, goodwill, assignable contracts, and accounts receivable. If accounts receivable are included, the agreement should explain who collects them, whether there is a holdback, how refunds are handled, and what happens if insurance adjustments reduce expected value.

Patient records require special attention. A buyer needs access to records to continue care, but the transfer must be handled consistently with HIPAA and applicable state dental board requirements. HHS explains that HIPAA applies to covered entities and business associates and protects individually identifiable health information. See HHS’s summary of the HIPAA Privacy Rule. The purchase agreement should require cooperation on patient notices, record transfer logistics, electronic health record access, and continuity of care.

The lease may be just as important as the purchase agreement. If the practice depends on location, signage, buildout, and local patient familiarity, the buyer needs to know whether the lease can be assigned, whether landlord consent is required, whether rent will increase, whether options can be exercised, and whether the landlord will require a personal guarantee. A dental buyer should not close on the practice without confidence that the office location can be retained.

Staff transition should also be handled carefully. The buyer should decide who will receive offers, whether benefits carry over, whether accrued vacation or PTO is assumed, and how restrictive covenants or confidentiality obligations will be handled. If the seller is staying for a transition period, the documents should explain schedule, compensation, clinical authority, patient introductions, and what happens if the relationship ends early.

Practical takeaway

The best dental practice deals are not rushed. Before closing, a buyer should review the asset purchase agreement, lease, patient records plan, employment issues, equipment list, software contracts, accounts receivable, financing documents, restrictive covenants, and post-closing transition obligations.

Sources and further reading

•            HHS Summary of the HIPAA Privacy Rule

•            HHS HIPAA for Professionals