The year 2021 saw the most private equity-related healthcare transactions in history, and while activity slowed in the first quarter of 2023, this reflects inflationary pressures and labor costs rather than private equity interest, according to VMG. Additionally, economic uncertainty has led PE investors to look to private credit, and smaller platform deals and add-ons according to the report.
Private equity interest in the ASC space has increased in the last few years. Two of the largest ASC chains — Surgery Partners and AmSurg — have private equity ownership, and other smaller groups are PE-backed as well.
This interest is driven by an industry shift to lower-cost procedures. For example, ASCs reduce the cost of orthopedic procedures by 17% to 43% on average, according to the report. Orthopedics and cardiology remain popular and growing specialties, and private equity firms are taking note.
“The biggest opportunities for ASC growth currently are for cardiac clinics,” Sandra Roush, BSN, RN, director of nursing at Salem, Ore.-based Pacific Cardiovascular Surgery Center, told Becker’s. “At Pacific Cardiovascular Surgery Center, we provide surgical procedures such as cardiac catheterization, stent placements and pacemaker implants in a safe environment that is preferred by the patients to the large local hospital. Benefits of ASCs include more personalized nursing care, faster admission and discharge, timely procedures, significant cost savings and great parking.”
There’s additionally an increasing demand for multispecialty centers as more procedures move to the outpatient setting. The number of multispecialty ASCs is expected to expand at a 4.3% CAGR.
Because ASCs offer cost savings and high quality care, private equity investment will likely continue as the ASC industry continues to grow.
At the Becker’s 32nd Annual Meeting: The Business and Operations of ASCs, taking place October 29-31 in Chicago, ASC leaders, surgeons and healthcare executives will explore strategies to drive growth, enhance operational performance, navigate reimbursement challenges and prepare for the future of ambulatory surgery. Apply for complimentary registration now.