HealthCare Appraisers shared results from its 2020 "ASC Valuation and Benchmarking Survey" in ASC Focus.
The survey found valuation multiples continued climbing in the ASC space. This upward trend can be attributed to multiple factors, including an increase in hospital outpatient departments converting to freestanding ASCs, more interest from private equity sponsors in surgical specialty physician practices and health systems trying to recapture procedure volume.
The survey also found nearly two-thirds of respondents were seeing an increase in three-party joint ventures, indicating hospital and health systems are seeing more value in partnering with ASC companies. Cardiology and vascular procedures became much more desirable specialties in 2020 due to CMS' approval of payment for certain procedures at ASCs.
The benchmarking survey found more than half of respondents saw reimbursement rates increase at a rate below inflation, while expenses grew faster than inflation. This was a factor leading to a slight decline in median earnings. ASCs that can perform higher-acuity specialty cases may be better suited to deal with pressures in the future due to higher reimbursement and profit.