Industry Mega Mergers: What Do the AmSurg-Sheridan & Surgery Partners-Symbion Deals Mean for ASCs?
The surgery center industry has proliferated since in its inception, only a few decades ago, and there are nearly 6,000 ASCs in the country today. The initial growth spurt has plateaued; in 2007 the number of ASCs grew 5.9 percent, but in 2012 just 1.2 percent, according to MedPAC data.
There have been concerned murmurs over market saturation and much louder discussion of how to continue successfully in a market with increasing regulatory requirements and decreasing reimbursements, but large companies continue to grow. Last year, Surgical Care Affiliates filed an initial public offering of up to $100 million in stock. Now, two key company players have initiated the year's largest ASC industry transactions. Many industry stakeholders hold out hope for the standalone, physician-owned ASC, the back upon which companies like SCA, AmSurg and Surgery Partners were built.
However, it is unlikely that the standalone, physician-owned center will be the most common model in the future. Instead, management companies, hospitals and even private equity firms are becoming strong contenders in the industry. ASCs have demonstrated excellence in outcomes and now more than ever this is attracting attention. ASCs will have the option to become part of health systems, accountable care organizations and large chains in the future.
Competition among management companies has grown. Tenet Healthcare, Hospital Corporation of America, AmSurg, Surgical Care Affiliates and United Surgical Partners International have more than 100 ASCs. After the closing of the Symbion acquisition, Surgery Partners will join their ranks. The AmSurg-Sheridan deal, while some may consider it a gamble, is a bold step towards diversification in the ASC industry — which could set it apart from the competition. Will other companies follow in the footsteps of these two deals and initiate another big industry merger?
More Articles on Transactions and Valuation Issues:
14 ASC Industry Acquisition Agreements in 2014
34 Hospitals & Health Systems Planning, Opening ASCs in 2014
The ASC Transaction Market Overview & What to Expect in the Future
© Copyright ASC COMMUNICATIONS 2015. Interested in LINKING to or REPRINTING this content? View our policies by clicking here.
To receive the latest hospital and health system business and legal news and analysis from Becker's Hospital Review, sign-up for the free Becker's Hospital Review E-weekly by clicking here.
- 143k medical professionals oppose mass deportation of undocumented population — 4 things to know
- The race for ASC efficiency and value: 4 ways to increase throughput and promote quality
- ASC industry leader to know: Stephen Rosenbaum of Interventional Management Services
- 10 most frequent sentinel events
- 15 things to know about orthopedics for ASCs