This past year has been full of activity amongst the key company players in the ambulatory surgery center market. Here are five things to know about AmSurg, Hospital Corporation of America, Surgery Partners, Surgical Care Affiliates and United Surgical Partners International.
1. AmSurg (Nashville, Tenn.). In 1986, David Manning and Rodney Lunn co-founded Practice Development Associates, the forerunner of AmSurg. The company became publically traded in 1997. Today, Christopher A. Holden leads AmSurg as its CEO, president and director, positions he has held since 2007. This year, Mr. Holden, along with several other leadership members, received significant raises. Mr. Holden's salary increased 30 percent, pushing his compensation to the $1 million mark. The company's CFO Claire Gulmi received a 9 percent raise to $500,000. Philip Clendenin, president of ambulatory services, received a 17 percent raise to $425,000. Chief accounting officer Kevin Eastridge's 19 percent raise brought his salary to $370,000.
As of the close of the fourth quarter of 2014, AmSurg had 246 centers. Five additional centers were under letter of intent, one that has since been acquired. The company has two additional centers under development. The company acquired 10 centers total last year.
AmSurg closed out the year with a significant surge in revenue. The company reported $581.8 million in net revenues for the fourth quarter of 2014, up 108 percent from the prior year period. Net revenues for 2014 were $1.62 billion, up 53 percent from 2013.
Last year, AmSurg completed the $2.35 billion acquisition of anesthesia provider Sheridan Healthcare. This year, the company has already acquired two radiology groups and announced plans to relocate offices to a larger location in Sunrise, Fla. The move is spurred by the Sheridan acquisition. The company is expected to move to its new location by September 2016. AmSurg will remain headquartered in Nashville.
The company has remained public since 1997. Recently, 12 analysts raised their ratings of the company's stock to "buy." On March 19, AmSurg's stock opened at $62.18 per share.
2. Hospital Corporation of America (Nashville, Tenn.). R. Milton Johnson is the chairman and CEO of HCA. Samuel N. Hazen serves as the company's chief operating officer. William B. Rutherford is the company's CFO and an executive vice president. John Sowell III is chief development officer and a senior vice president. Robert A. Waterman is the company's general counsel and chief labor relations officer. Gregary Beasley is president of the company's ambulatory surgery division.
At the close of the fourth quarter of 2014, HCA owned 166 hospitals and 113 freestanding outpatient surgery centers.
The company reported $9.6 billion in total revenues for the fourth quarter of 2014, up from $8.8 billion in the prior year period. HCA's net income was $527 million for the fourth quarter, up from $424 million in the fourth quarter of 2013. The company's revenues for 2015 were $36.9 billion, up from $34.2 billion in 2013.
The company expects its 2015 revenue to between $38.5 billion and $39.5 billion.
HCA is a publically traded company. It has gone from private to public a number of times in its history, but has remained public since public since its shares began trading on the New York Stock Exchange in 2011. During the week of March 9 to March 13, the company's stock traded at $71.81 per share.
3. Surgery Partners (Chicago). Surgery Partners is a portfolio company of equity investment firm H.I.G. Capital. The company is lead by CEO Michael Doyle. Teresa Sparks is the company's CFO. Chris Throckmorton is the company's COO, and Jennifer Baldock serves as chief compliance officer and general counsel. Ms. Sparks and Ms. Baldock previously held these positions with Symbion, which was acquired by Surgery Partners in 2014.
Surgery Partners completed the $792 million acquisition of Symbion in November 2014. The combined companies now operate more than 100 facilities in partnership with 2,400 physicians in 26 states.
This year, Surgery Partners acquired a majority interest in Delaware Outpatient Center for Surgery in Newark. The multispecialty center has been open since 2005 and has 30 physician partners. More than 50 physicians perform procedures at the center.
In addition to the ASC acquisition, the company acquired two physician practices in December 2014.
Symbion was a public company, but Surgery Partners operates privately.
4. Surgical Care Affiliates (Deerfield, Ill.). SCA was founded in 1982 by Joel Gordon. Today, Andrew Hayek leads the company as its president and CEO. Pete Clemens is the company's CFO and executive vice president. Joe Clark is the company's chief development officer and executive vice president, and Michael Rucker serves SCA's COO and executive vice president. Rich Sharff is the company's general counsel and an executive vice president.
More than 2,000 physicians and more than 40 health systems are partnered with the company. During the final quarter of 2014, SCA added six facilities, three of which were consolidated, two of which were non-consolidated and one which was managed only. As of December 31, 2014, SCA operated 186 surgical facilities. The company has added an additional four facilities since the beginning of 2015.
SCA reported $247.2 million in total net operating revenues for the fourth quarter, excluding revenues from facilities in which the company owns a non-controlling interest, up 15.6 percent from $213.8 million in the prior year period. The increase was driven by acquisitions, higher acuity case mix and a number of improved payer contracts. System-wide net operating revenues, including all facilities in which SCA owns an interest, increased 9.9 percent in the fourth quarter. The company's adjusted net income for the fourth quarter was $27.9 million, up from $17.6 million in the fourth quarter of 2013. The company's system-wide net operating revenues for the full year, including all facilities in which SCA owns an interest, increased 10 percent. Adjusted net income for the full year rose 69.8 percent from $48 million in 2013 to $81.5 million.
SCA has made a number of new partnerships within the last year. In the fall of 2014, the company formed a joint venture with the Newport Beach, Calif.-based DISC Sports & Spine Center. SCA is a majority equity partner in DISC. Just this month, SCA announced a new partnership with The CORE Institute and group of independent physicians. The three partners joined to open The CORE Institute Specialty Hospital in Phoenix.
In 2013, SCA filed for an initial public offering of up to $100 million in stock. The company continues to operate publically today. On March 19, the company's stock opened at $35.12 per share.
5. United Surgical Partners International (Dallas). USPI has been led by CEO William Wilcox since 2004. Mr. Wilcox is also an executive committee member of the company's board of directors; he joined the company in 1998 as president and a director. Jason Cagle is the company's CFO, and Brett Brodnax serves as president and chief development officer. Brand Bickham is USPI's chief legal officer.
USPI acquired 10 centers total in 2014, two of which were acquired during the final quarter of the year. The company owns or operates 219 centers, 154 of which are joint ventures with non-profit health systems.
USPI reported net revenues of $174.7 million for the fourth quarter, up 6 percent from $164.9 million in the fourth quarter of 2013. USPI's net revenues for 2014 increased 4 percent from $616.2 million in 2013 to $640.8 million this year.
The company's operating income for the fourth quarter increased 5 percent from $81.9 million in the prior year period to $86.1 million. Operating income for 2014 was $269.8 million, up 2 percent from $263.8 million in the prior year period.
USPI was taken public in 2001, but returned to being private in 2007. The company remains privately held today. The company has close ties with private equity firm Welsh, Carson, Anderson & Stowe.