Five leaders joined Becker's to discuss private equity's influence in the ASC industry:
Michael McClain. Executive Director of Ambulatory Surgery at Providence (Renton, Wash.): It seems like every day, there is a new player in the ASC space, be it private equity, large medical groups, insurance carriers, or even tech and sales giants entering the fray. While those parties bring big purse strings and expertise, many of these organizations lack the deep relationships and multilevel community connections that local health systems and medical groups have. In my mind, the MOST important aspect of maintaining and growing our businesses and margins is maintaining and improving our relationships with our physicians and community leaders. Those relationships help organizations weather the storms of pandemics, capital challenges, regulatory changes and growth.
Prashanth Bala. Vice President of ASC Operations at Shields Health (Quincy, Mass.): Consolidation is an interesting question. Here in Massachusetts, we have seen private equity start to move into the orthopedic space. We've also seen it move into the vascular space. With it being such a small state, that has resounding impacts. So we're seeing how that's playing out now. I think only time will tell how much of a true impact private equity will have on care delivery or the access to care that such funds are able to help bring to the community. We're really optimistic that, even despite that, our partnerships are strong. That's our opportunity to continue to work with our partners to maximize our ability to transform healthcare and also provide that care for our communities. We're really excited about where we are and what we're doing in that space.
Catherine Retzbach, BSN, RN. Director of ASC Operations at Virtua Health (Marlton, N.J): Leaders and executives will need to be flexible and focused regarding how they want their centers to succeed. Change is always difficult, so it takes dedication and focus to achieve change. Adding service lines takes research and commitment. Also, sometimes difficult decisions need to be made, such as decreasing days of service if volume does not warrant being open every day. If you want to add a new service line, will you have enough procedures performed to cover the costs? The next five years will bring more private equity involvement along with consolidation, so leaders will need to stay on top of business trends and regulatory updates.
Maxim Sheinman. Director of Business Development at HCA Healthcare (Nashville, Tenn.): I believe these are the factors that will affect the ASC industry with declining reimbursements:
Declining reimbursement will lead to additional physician employment by larger health systems. Will also cause declining quality and availability of physician services. More physicians will become employed and will perform less cases in an ASC setting. We will continue to see the consolidation and corporatization of medical practices. More physicians will seek employment in private equity-backed corporations for stable income. Finally, the standard of medicine in this country will continue to decline.
Neal Kaushal, MD. Chief of Gastroenterology and Chair of the Department of Medicine at Adventist Health (Sonora, Calif.): I'm most nervous about the consolidation of larger health systems making care delivery less nimble and flexible. Healthcare delivery has to evolve continuously along with the needs and wants of the consumers — i.e., the patients. With smaller entities being acquired by larger ones, whether that be health systems, private equity firms or university-based medical centers, increased standardization can also spell a decreased ability to adapt quickly to changes in the healthcare landscape. It will be more important than ever to keep this in mind going forward as mergers and acquisitions continue to take place.