Becker's ASC Review

29 JOINT VENTURES USPI has seen 40% of pre-pandemic cases as ASCs reopen, Tenet says By Laura Dyrda A ddison, Texas-based United Surgi- cal Partners International reported surgical cases dropped 28.6 percent in March due to the COVID-19 pandemic, which hit just as the company was reporting acceler- ated growth. But its centers are reopening, and it has seen around 40 percent of its volume return. Before the pandemic, USPI was ahead of its budget as a result of service line expansion in 2019 and ramping up acquired and de novo ASCs, but many centers closed due to virus-related procedure restrictions. "We took action to furlough and flex down teams at USPI, closing over 100 facilities and reducing hours and days in the balance of facilities," said Ron Rittenmeyer, executive chairman and CEO of Tenet, USPI's parent company, during its first quarter earnings call transcribed by Seeking Alpha. "We main- tained the minimal staff, as recommended by CMS, and some USPI locations prepared to handle any overflow from hospitals, driven by the need to serve emergencies, which fortunately did not occur." Tenet reported a 75 percent decrease in sur- gical volumes for USPI and deployed some hospital nurse volunteers to such hard-hit ar- eas like Detroit, Arizona and New York City to assist in managing the surge of patients with COVID-19. Tenet received $1.5 billion under the ad- vanced payment authorization from CMS, which it will pay back between August 2020 and March 2021, the company reported dur- ing its earnings call. Over the past few weeks, Tenet's hospitals and surgery centers have focused on ramp- ing elective procedures back up safely. "We have begun to resume elective proce- dures consistent with area regulations and in close consultation with our physicians," Mr. Rittenmeyer said. "Our early reads are promising, and we expect it may take several months to bring up our USPI locations to pre-COVID volumes." He also said many of Tenet's facilities were opening to 50 percent of pre-COVID surger- ies in the beginning of May. USPI President and CEO Brett Brodnax said more complex cases, including spine, total joints and general surgery are coming back more quickly than lower acuity cases. n Envision parent KKR sets sights on new transactions: 5 things to know By Angie Stewart D eal-making is on the horizon for KKR, the par- ent company of Nashville, Tenn.-based Envi- sion Healthcare, according to Bloomberg. Five things to know: 1. KKR raised $10 billion in March and April, signaling interest in more transactions. 2. The firm is ready "to not only play defense but also [play] more offense," according to Scott Nuttall, KKR's co-president. 3. Specifically, KKR is looking to provide liquidity to struggling companies and working with its portfolio companies to seize growth opportunities. 4. KKR's private equity portfolio fell 12 percent in the first quarter, one of many areas in which the firm saw declines due to the COVID-19 crisis. 5. Envision Healthcare has been hit particularly hard, incurring steep losses from COVID-19-related elective surgery bans. n Local physicians, hospital vie for South Carolina surgery center project By Eric Oliver A pair of local clinicians are competing against Orangeburg, S.C.-based Regional Medical Center to earn approval to develop a surgery center in Orangeburg, The Times and Democrat reports. What you should know: 1. General surgeon and RMC board member Dion Franga, MD, and radiologist Amit Sanghi, DO, submitted a certifi- cate-of-need application to build a $12.5 million ASC April 7. 2. The ASC would be 16,640 square feet and would have two operating rooms. 3. RMC submitted a CON application for an ASC April 15. According to Dr. Franga, the hospital's strategic plan "did not call for an ASC." The hospital last expanded in 2006. 4. Dr. Franga met with hospital board members in March to discuss opening his ASC as a joint venture, but the conver- sation never advanced. Dr. Franga said he and Dr. Sanghi would be interested in a joint venture in the future. n

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