ASCs see influx of private equity investment 

February 27, 2023 – A large amount of private equity (PE) capital is ready to be deployed within healthcare services. Partnerships between PE firms and physician groups can result in significant benefits to boost the financial strength of orthopedic groups, as just one example, and other clinical group ownership businesses, especially after the pandemic upset the climate. 

Transaction activity in the physician group sector has accelerated rapidly in the post-pandemic atmosphere. A panel discussion at Share Moving Media’s First Annual Ambulatory Surgery Center Meeting in Atlanta last November tackled this issue for ambulatory surgery centers (ASCs) as well as ASC strategies and operations, and how GPOs and suppliers work with the non-acute supply chain. 

PE firms are increasingly acquiring ambulatory surgical centers (ASCs) across the nation. But what are the implications for clinicians and patients? A recent NIH study identified 91 ASCs acquired by PE and 57 ASCs acquired by non-PE entities from 2011-2014 that found “no statistically significant observed change in the probability of an unplanned hospital visit, total costs, or total encounters after acquisition by PE relative to acquisition by non-PE entities.” 

And when PE-acquired ASCs were compared to matched ASCs that were never acquired, it found the same – no statistically relevant change of an unplanned hospital visit, total costs, or total encounters. But as more physicians sell to PE firms, it has raised apprehension about costs and quality. 

The next three to five years will be an important period to watch, according to Robert Mayhew, director of procurement and contracting at Revo Health, which is a management services organization that partners with physicians in business and clinical intelligence, ASC development and management, and professional services. Mayhew spoke about the ASC market in the U.S. at Share Moving Media’s First Annual Ambulatory Surgery Center Meeting last November. He was joined by Sanchia Patrick, vice president of strategic marketing for Henry Schein Medical, and Hilary Grittner, vice president of non-acute sales for Provista Distribution on a panel discussion. 

“There are so many ASCs and independent physician groups that there isn’t a one size fits all. It will be different depending on the group,” he said. 

Read more in the latest issue of The Journal of Healthcare Contracting.  

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