Becker's ASC Review

Executive Briefing: ASC Industry Transaction Trends 34 es to 21 percent of ASCs at 15 years, 37 percent of ASCs at 20 years and 50 percent of ASCs at 25 years. There are several possible explanations for this correlation. 1. As with many business enterprises, those with longer lifespans are more likely to have experienced major ownership changes than their relatively newer counterparts. Not all things are created equally. 2. The 1,221 ASCs that have experienced one or more major ownership changes may buy-out passive investors and/or dilute existing investors with more frequency and volume than comparable ASCs, thus keeping the physician mix productive; and/or 3. These ASCs may have made more ma jor, strategic ownership transactions with hospitals or management companies that contribute significant value. Conclusion 1,800 ASCs turn 10 to 12 years old. Many ASCs may sell their facilities and/or assets to major ASC operators, hospitals, or second generation owners as they approach this milestone. jor ownership increases among ASCs increases as they age. About 13 percent of ASCs that have been in operation 10 years have experienced at least one major ownership change. This increas- Historical trends indicate the incidence of major ownership changes increases linearly among ASCs as they age. If this trend continues, ASC transaction activity will likely remain robust for the foreseeable future, as 1,800 ASCs surpass the 10 to 12 year threshold between 2013 and 2019 while, during the same period, the number new ASCs opening has decreased. n We are not your average Healthcare Valuation Firm. This is trend corroborated by the 2013 ASC Valuation Survey. Fifty-three percent of respondents believe that ASC acquisition activity has increased over the past 12 months. For 2013, acquisition activity is expected to remain high, as 53 percent of our respondents plan to purchase between 11 to five ASCs, 12 percent plan to purchase between six and 10 ASCs, and 12 percent plan to purchase between 11 and 15 ASCs. With over 12 years in the business and thousands of fair market value opinions rendered, HealthCare Appraisers has assembled a diverse, highly experienced team to help you navigate through a myriad of valuation needs and dilemmas. Major Transaction Activity Medicare data also suggests there is a definitive correlation between longevity and the number of major ownership changes that occur during an ASC's lifespan. Medicare-certified ASCs are required to notify Medicare of ownership changes (i.e., a "CHOW"). According to the data reported by Medicare, the incidence of ma- HealthCare Appraisers - Redeening Healthcare Valuation Since 2000 HealthCare Appraisers, a nationally recognized valuation and consulting firm, provides services exclusively to the healthcare industry, www.HealthCareAppraisers.com | info@hcfmv.com | (561) 330-3488 including: business valuation (e.g., ASCs, hospitals, physician practices, dialysis centers, home health, diagnostic/treatment facilities, DELRAY BEACH | DENVER | DALLAS CHICAGO | PHILADELPHIA and intangible assets); fixed asset appraisals for furnishings, machinery |and equipment; fair market value opinions for compensation and service agreements (e.g., employment, ED call coverage, medical directorships, collection guarantees, equipment lease/ use arrangements, and service/co-management arrangements); consulting and advisory services (including valuation for financial reporting); and litigation support.

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