Becker's Spine Review

15 THOUGHT LEADERSHIP that, with any consolidation, you're adding a new player to the market and there will be compromises. ere will be a second wave in four to five years when those consolidated structures turn or reform, so evaluate and choose carefully, especially if your anticipated term of practice exceeds that timeframe. Given the economic forces at work and complexity of running a practice, it is inevitable that MSOs and private equity-backed structures will be taking over a role from the hospitals, and it will remain to be seen how well they look aer the physicians. is is an area that requires careful consideration. You need to know the people and plans for that MSO before jumping into such a relationship. Aer undergoing the same careful consideration myself, I did ultimately choose to participate and merged DISC into Chicago Pacific Founders' private equity group. e new venture we created is going great. Nicholas Grosso, MD. e Centers for Advanced Orthopaedics (Bethesda, Md.): Traditionally, MSOs provide physician practices with the tools they need to streamline business functions. It's a practical and efficient business model to ensure that patients are the number one focus for a physician. While many groups in the orthopedic and musculoskeletal space may benefit from such services, there is now a new type of MSO emerging; a next-generation MSO that will provide all the typical MSO services as well as the tools and technical expertise for groups to succeed at risk-based contracting. I anticipate more physician practices in the musculoskeletal space will take advantage of these next-generation type MSOs in the next five years. We'll likely see more MSOs enter the market, and ultimately the consolidation of MSOs. e Centers for Advanced Orthopaedics came together nearly a decade ago to protect and enhance private practice medicine. Earlier this year, we launched our next-generation MSO, MedVanta, which is physician owned and operated. We remain steadfast in our commitment to physician independence, so launching MedVanta — which, amid a landscape that is increasingly being dominated by corporations and financiers, is empowering the private practice model of care — was a natural next step in CAO's evolution. n Why private equity is bettering orthopedics, 3 physician leaders say By Carly Behm P rivate equity investment is an evolving force in orthopedics and can give practices an advantage in the market, according to physicians part of the July merger of two management services organizations. United Musculoskeletal Partners and Novum Orthopedic Partners merged, and Denver-based Panorama Orthopedics and Dallas-based Arlington Orthopedic Associates joined as founding partners. Raj Bhole, MD; Eric Wieser, MD; and Mark Conklin, MD, are leaders of the founding partners, and they spoke with Becker's about private equity and their outlook for orthopedics. Note: Responses were edited for clarity and length. Question: What's your outlook for private equity in orthopedics? Do you think it's doing more good or harm to the specialty overall? Dr. Raj Bhole. UMP Board Member and Chair of Resurgens Orthopedics (Atlanta): Private equity has successful roots in healthcare. Private equity in orthopedics is in an early stage, and it will certainly continue to evolve and mature. But the core principles of physicians maintaining leadership, decision authority and equity ownership are sound. As these markets continue to consolidate amongst hospitals, healthcare systems and managed care organizations, it is essential that patients seeking high-quality, cost-effective care, and physicians striving to practice medicine in an independent, private practice setting, have choices. UMP provides that choice. Dr. Eric Wieser. UMP Board Member and Vice President of Arlington Orthopedic Associates (Dallas): I think private equity is good for the specialty because it allows physicians to really focus on what's important — practicing medicine and giving our patients the best care possible. Private equity gives us the advantage of having access to the capital that we need to expand and having people with business training take care of running our groups efficiently and growing the business. Dr. Mark Conklin. UMP Board Member and President of Panorama Orthopedics (Denver): I think private equity is a great opportunity for orthopedics to really solidify our future. We compete against health systems and in some cases, managed care companies that are coming in and have really deep pockets. This is our way to solidify our future in the market and be able to grow with the capital that we need. Healthcare is a business, and it becomes complicated when we're trying to practice medicine to also focus on growing our business in order to compete in the market. Private equity provides expertise and experience in the business side, which is a huge plus. Establishing value-based care is also very important, but is a very expensive thing to try to do. It involves a large number of physicians and a larger geographical area to accomplish that. Consolidation has been around for a long time. There are lots of large orthopedic groups around the country. In a lot of cases they're just a merger of smaller groups and probably not as integrated as we plan on becoming. So I see private equity being here to stay and I think it will continue to grow. n

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