Atlanta-based United Digestive didn't renew its professional services agreement with CRH Medical, and its contract will expire Oct. 31, 2021, CRH announced Dec. 22.
CRH provides anesthesia services to 12 United Digestive surgery centers. CRH expects United Digestive will account for 20 percent of its adjusted operating-EBITDA in 2021.
The nonrenewal will affect CRH's financials in 2022.
CRH and United Digestive have been in negotiations for several months. CRH believed it would reach an agreement with United Digestive. CRH wrote, "It is not clear that an agreement will be reached on terms acceptable to the company."
Tushar Ramani, CEO of CRH, said: "We believe that we can replace much of this EBITDA through acquisitions and organic growth throughout 2021, and mitigate the potential financial impact in 2022. We are thankful for the opportunity to have served UD's patients over the last six years, and are committed to an orderly transition, if needed, at the end of the current agreement."