Helping healthcare organizations achieve successful business transactions with hands-on, consultative valuation (FMV) and financial advisory services.
As a healthcare valuation professional, I am often asked: “Is price the same thing as value?”? ?? While these two concepts are closely related, there are distinct differences. “Price” is the amount paid in a transaction; whereas “value” is a measure of the perceived worth of the item being transacted. As Warren Buffet famously said, “Price is what you pay, value is what you get.”? ?? Here is how I break it down:? ?? Price is an easily understood, objective measure, typically expressed in monetary terms. Value, on the other hand, can mean different things to different people and under different circumstances. Generally, the value we place on something is a function of its utility – that is, its usefulness in satisfying a want or need.??? ?? For appraisers, the term value must be defined a specific way to answer the question “value to whom, and under what transactional circumstances?” These are referred to as “standards of value” and include fair market value (required in most healthcare transactions), fair value, investment value, intrinsic value, and liquidation value. #fairmarketvalue #healthcarevaluation #healthcareappraisers Root Valuation