How much more consolidation will there be?

Consolidation continues to run rampant throughout the ASC industry, but is there a ceiling to how much there can be?

Prashanth Bala, vice president of ASC operations at Shields Health Care Group in Quincy, Mass., spoke with Becker's about consolidation in the ASC market, pros and cons of consolidation, and which specialties are thriving.

Editor’s note: This piece was edited lightly for brevity and clarity.

Question: How much more consolidation will there be?

Prashanth Bala: The next couple years are going to be really interesting in terms of the future for ASCs. I think in the next couple of years there will be smaller practices starting to acquire, there will be medium-sized practices maybe consolidating among themselves to make super groups or larger groups. I think the next couple of years are truly going to be about finding your footing and sort of recovering from perhaps some of the losses during COVID. So what's the best way to consolidate? Some hospitals, naturally and should, consolidate with their physician practices. At the same time, maybe because of payer challenges or possible hospital staffing challenges, you might see other private physician groups binding together to say, "Hey, can we do this on our own?" and then maybe moving out into an ASC market or into an ASC depending on the market, state and those regulations. I think you're going to see a healthy mix of both consolidating physicians into hospitals as well as private physicians consolidating among themselves into larger groups to have more clout within the market.

Q: What are the pros and cons of consolidation?

PB: With consolidation with a hospital and into a hospital partnership, you have a more captive audience of surgeons that can utilize the facility. So there's a great deal of a pro there in just being able to have a captive audience of surgeons that would otherwise perhaps be biding time in multiple locations but can have them all come to one location.

A con, however, is that loss of identity. A lot of private physicians or physician groups function a little bit differently when they are "eating what they kill" so to speak. If they have to hunt and find, they see it as their own business, as being part of an ASC. From an administrative perspective, it's a fine balance of finding the right surgeons. The right surgeons will always be the right answer.

Q: Which specialties are or are not thriving in the market?

PB: If you follow the money, you'll see some of those [specialties] thriving. At the same time, the types of procedures that no longer need to be done in the hospital are probably what's thriving the most. You see muscular and skeletal continue to thrive, so orthopedics. I think you're seeing a really large growth in plastic surgery more recently in the last two years. Cardiology seems to be growing too. Procedures that don't need to be performed in a hospital or operating room anymore can be moved to an outpatient setting.

I think clinically what we're seeing that's really struggling is ear, nose and throat. Especially from the pediatrics perspective, I think after about a year and a half, almost two years of wearing a mask, a number of children just haven't gotten sick. They haven't gone to see the doctor to see if they need ear tubes or they haven't gotten sinus-related symptoms as a result of being able to wear a mask and not catch germs. ENT has been a really hard specialty for us to see growth in, but I think we're going to start to see some of that rebound here in the near future.

Copyright © 2024 Becker's Healthcare. All Rights Reserved. Privacy Policy. Cookie Policy. Linking and Reprinting Policy.


Featured Webinars

Featured Whitepapers

Featured Podcast