Notice of the 209th Meeting of the Labour Policy Council, Working Conditions Subcommittee

News Highlights

The 209th meeting of the Labour Policy Council, Working Conditions Subcommittee was held. The meeting suggested the importance of early consideration of third-party succession options, other than closure or business dissolution, as a measure for the succession problem in medical institutions. In particular, preparation starting 5 to 10 years in advance from around age 60 for the chairman/director and president is recommended, and the utilization of specialized advisors focused on the medical industry is also mentioned as an effective measure.

M&A Medical Editorial Department’s Perspective

This notice of the Labour Policy Council, Working Conditions Subcommittee meeting might seem like a general policy discussion forum at first glance. However, the early consideration of “third-party succession for succession issues,” which its content suggests, is extremely important from the perspective of maintaining regional medical care. Especially in small hospitals and clinics in rural areas, the aging of chairmen/directors and presidents, and the lack of successors have become serious management challenges. Preparing for third-party succession through M&A on a 5-10 year timeline, rather than simply choosing the option of “closing down,” leads to the maintenance of employment for staff and the continuation of the medical provision system for local residents. For example, in the case of △△ Hospital, which closed in XX Prefecture, it cannot be denied that the period of medical care vacuum in the region could have been shortened if M&A had been considered early. The utilization of specialized advisors is indispensable for smoothly selecting appropriate buyer candidates, conducting due diligence, and proceeding with contract negotiations, based on an understanding of the characteristics of medical institutions.

Points Indicated by This News

• The fact that “third-party succession,” other than closure or business dissolution, was officially suggested for medical institutions facing a lack of successors.
• The necessity of business succession preparation from a long-term perspective of 5-10 years, starting around age 60 for the chairman/director and president.
• The utilization of specialized advisors who understand the unique characteristics of medical institutions is the key to smooth third-party succession.
• Proactive measures for succession issues are required to ensure the continuity of regional medical care.

Practical Questions Arising from This News

• What specific third-party succession schemes can be considered?
• What is the appropriate timing and cost for consulting with a specialized advisor?
• How is staff employment protected in the case of a lack of successors?

If You Feel “Should I Consult Too?”

Are you the chairman/director or president of your institution, around age 60 or older, and are you concretely considering a successor? If there is no successor candidate within your family or internally, or if you have concerns about their development, please consider “third-party succession” as an option other than closure or business dissolution, to pass on your institution’s philosophy and the light of regional medical care to the future. At M&A Medical, specialists focused on medical institutions will propose the optimal succession plan tailored to your institution’s situation. Why not start by thinking together about your institution’s future through a free consultation?

M&A Medical (CentralMedience Inc.) supports the business succession of medical corporations, hospitals, and clinics on a full success fee basis as an M&A support institution certified by the Small and Medium Enterprise Agency. Consultations are accepted with strict confidentiality. Free consultation here