Four ASC leaders joined Beckers to discuss the importance of ASC ownership stake amid an increasingly consolidating healthcare industry.
These responses were edited lightly for brevity and clarity.
Jeff Baird. Former Administrator of Willamette Ear, Nose, Throat & Facial Plastic Surgery (Salem, Ore.):
- Ownership in an ASC (or clinic) is important because the physician owners become more cost conscious while focusing on quality care as they have more at stake in the organization.
- Direct physician involvement can have a downside as too much direct involvement can fractionate leadership and hinder operation. A sound governance structure with well-defined areas of responsibility and accountability is essential to make sure the organization runs efficiently and effectively.
Susheela Bala, MD. Owner of ACE Endoscopy Center (Rialto, Calif.): ASCs for physicians are more convenient rather than profitable. The only way it is profitable and gets at least 10 percent profit is by running it yourself. The moment you use a management company, there is nothing for the physician except convenience.
Alejandro Fernandez. CEO of Synergy Orthopedic Specialists (San Diego):
- Control and decision-making: Owning a stake in an ASC gives individuals or groups greater control over strategic decisions.
- Financial returns: Ownership stake in the ASC can offer additional returns, and as the entity grows and becomes more successful, owners may benefit from increased profitability, dividends or the ability to sell their stake at a higher value. This can be particularly valuable in a consolidating industry where larger healthcare systems and private equity firms acquire smaller ASC.
- Alignment of interests: When individuals or groups have an ownership stake in an ASC, their interests become directly aligned with the success and performance of the organization. This alignment can foster a sense of commitment, dedication, and accountability among the owners, which can positively impact the overall performance and quality of care delivered.
- Influence and market positioning: The ASC ownership will give the group a stronger voice and influence within its local healthcare market. It can enhance their credibility and reputation, facilitate networking and collaboration opportunities, and enable them to participate in industry-wide discussions and initiatives.
Bo Neichoy, MD. Bariatric Surgeon at Florida Coast Weight Loss Center (Palm Coast): Bo Neichoy. As the industry consolidates, if you do not have a pre-existing stake in an ASC, that door will be closed to you. Your medical career (financially) will be controlled by the system. In addition, you will miss out on any future sale of your stake (multiples of profit). If your center is profitable (which it should be!) this could be a significant amount of money.