A key driver of this growth is the company’s de novo strategy, according to executives of its parent company, Tenet Healthcare, who discussed the strategy during a Feb. 12 earnings call.
Here are five things to know about the company’s de novo strategy:
1. USPI added nearly 70 ASCs in 2024, remaining “very active in both [mergers and acquisitions] and de novo development.” The company anticipates adding 10 to 12 de novo centers in 2025.
2. De novo growth can take different forms, Tenet Executive Vice President and CFO Sun Park said in the call, whether expanding within existing markets or entering new ones.
“[Companies] have realized that there isn’t a better operator of ASCs to generate margin from those investments for those doctors than USPI,” he said. “So that’s another vector of growth that is helping to create de novo activities.”
3. Mr. Park emphasized that de novo development is “really critical” for USPI, and that the company has been focusing on scaling up this area.
“Consistent with our move into more high-acuity ambulatory surgical work, de novos also represent a significant value shift in markets, because usually what you’re doing is building from the ground up,” he said. “You’re moving things into a lower cost setting. It’s value for the consumers and payers in the markets to be focused on de novos, in addition to everything else that we may be doing to grow the portfolio and expand the high-acuity services, so that it’s part of our value strategy there.”
4. De novo ASCs, Mr. Park added, are “not like building an acute care facility” because they come with lower build costs and quicker turnaround times, once partnerships are syndicated.
5. While there’s work upfront “in syndicating the partnership that takes time, but that’s not a capital-intensive activity” Mr. Park said.
“We also focus on measuring and following our overall return on invested capital within the organization,” he added. “And obviously, the more we shift into this ambulatory segment, the more that gets better.”
