Is private equity digging deeper into ASCs? 6 notes

Here are six notes about private equity's ASC influence from the last year:

1. Private equity increases the cost of caring for patients in six major physician specialties, according to a July 10 report published by the American Antitrust Institute. According to the study, private equity-acquired practices in several specialties had statistically significant expenditure per patient increases. 

2. U.S. Anesthesia Partners, created by private equity firm Welsh, Carson, Anderson & Stowe in 2012, became one of the most powerful anesthesia presences in Colorado. As the company's size grew, so did the cost of services, resulting in higher patient bills and insurance rates. This caused tensions between the company and physicians to rise, with about 1 in 3 leaving USAP over a three-year period, according to the Washington Post.

3. Private equity firms have long used ASCs as investment vehicles, and after courting key ASC specialties like gastroenterology, orthopedics and ophthalmology, they could be looking to cardiology as a new area of growth. 

4. In November, Brentwood, Tenn.-based Surgery Partners snagged an $800 million equity offering. Bain Capital Private Equity, the company’s investment partner, participated with $225 million of the raise. The other $575 million is an upsized underwritten public offering.

5. Although private equity deal activity in the ASC industry has remained relatively consistent over the last six years, investors have changed their spending patterns in response to the changing scope of care, according to a report by healthcare finance company VMG Health.  VMG's report found that investors are putting their money more intentionally into practices. Private equity interest is tied to their physician practice portfolio offerings, so private equity groups have been eyeing gastroenterology, orthopedics and cardiology care. 

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