USPI in 2019: 5 things to know

United Surgical Partners International, the ambulatory surgery center segment of Tenet, boosted its market share, from owning 5 percent to 6 percent of ASCs in the last year, and it continues to see opportunity for growth.

Five things to know about USPI in 2019:

1. In February, Tenet CEO Ron Rittenmeyer reported a 7.5 percent net operating revenue for USPI in 2018, and said the company could exceed $175 million in acquisitions for the right deals in the future. USPI CEO Brett Brodnax also discussed the company's view on private equity in healthcare during the fourth quarter and full year 2018 earnings call in February.

"Some people would view that as competition," he said. "Quite honestly, we see that as an opportunity. If we can work with some of these PE firms to help leverage our infrastructure as opposed to them having to replicate the infrastructure, we think there is an opportunity to partner with the PE firms to help grow their footprint and scale out of their business at a much more expeditious pace."

2. USPI continues to gain market share as a profitable business line for Tenet. At the Morgan Stanley Global Healthcare Conference in September, Mr. Rittenmeyer said the company has around 6 percent of ASCs and plans to continue investing in USPI's growth. "[The ASC market] is a very fragmented area, and we own about 6 percent of facilities out there. So, when you think about it, we have a tremendous opportunity still for consolidation as well as de novos," he said.

3. In the last year, USPI also has entered into several key partnerships. The company reported entering into a joint venture with Hackensack (N.J.) Meridian Health and Vanguard Surgical Center as well as Dignity Health and the West Coast Joint and Spine Surgery Center in El Dorado Hills, Calif.

4. In November, Tenet agreed to settle claims USPI and one of its surgical hospitals were involved in false claims, anti-kickback and Stark Law violations. The company paid $66 million to settle allegations that USPI and Oklahoma Center for Orthopedic & Multispecialty Surgery billed for services by a physician who had an improper relationship with the hospital. Tenet had already established a reserve for the payment.

5. USPI reported 6.9 percent revenue growth in the third quarter and a 5.1 percent increase in case volume. Revenue per case was up 1.7 percent for the quarter. For the nine-month end, the ambulatory segment reported $1.5 billion in revenue, flat from the same period the previous year. Same-facility revenue was up 5.5 percent, and revenue per case jumped 2.3 percent.

More articles on surgery centers:
Surgical Care Affiliates in 2019: 5 things to know
Montecito Medical buys MOB, ASC in Virginia: 4 details
New York surgery center to close — 3 insights

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