Five things to know about consolidation among surgery centers and physicians:
1. Provider consolidation into vertically integrated health systems increased "substantially" from 2016-18, while horizontal consolidation of hospitals and health systems "grew modestly," according to an August 2020 study published in Health Affairs.
2. The ASC space is ripe for facility-level consolidation, according to VMG Health. The ASC market didn't see any platform-level transactions in 2019, but consolidation continued in the fractured sector. About 71 percent of ASCs remain independent, leaving room for further facility-level consolidation.
"We are continuing to see themes from 2018 play out in 2019 and into 2020," VMG Health analysts concluded. "The expectation is that there would be further consolidation within the ASC market with a greater involvement by private equity companies. At the center level, higher acuity case volume will continue to shift from the inpatient setting, further cementing the ASC as the low-cost, efficient alternative to the hospital setting."
3. Richard Harris, MD, a Melrose Park, Ill.-based urology specialist and president of the Large Urology Group Practice Association, told Becker's ASC Review in April that the COVID-19 pandemic could have a significant influence on independent practice throughout the U.S.
"There is a real threat that hospitals may use government stimulus funds to buy out physician practices, increasing the upward trend of hospital consolidation," Dr. Harris said. "The acquisition of more physician practices by hospitals will not be a win for our patients; instead, it will only serve to further inflate the cost of medical care to patients. Additionally, hospital consolidation hinders access to care as it creates narrow networks that require patients to travel further to find in-network physicians."
4. LUGPA is one of many entities working to preserve physician autonomy. Former Cardinal Health CEO Parker Eales is leading the North Carolina Independent Dermatology Collaborative, a 23-provider organization intended to provide higher efficiencies at lower costs than hospital systems can offer.
5. Financial problems due to nonessential procedure standstills could lead to a spike in healthcare consolidation and less competition after the pandemic, according to Manatt Health Managing Director Jonah Frohlich.
"We're going to see a raft of acquisitions and mergers and integrations with independent clinicians who can't survive months of no revenue," he said in an interview with Stateline.