Becker's ASC Review

30 CODING & BILLING Increased Merger and Acquisition Activity in the Ambulatory Surgery Center Market … What Does it All Mean? Written by Nader Samii, Chief Executive Officer, National Medical Billing Services M erger and acquisition activity in the ambulatory surgery center (ASC) arena has drastically increased in the past two years. is flurry of activity has le many in the ASC market wondering what this might mean for their centers, as well as what it might mean for the broader ASC mar- ket, in the upcoming years. In 2015, Tenet Healthcare Corp. acquired United Surgical Partners International (USPI) in a joint venture transaction. In 2016, AmSurg Corp. merged with Envi- sion Healthcare Holdings Inc., a provider of facility-based physician, population manage- ment, and medical transportation services, to form Envision Healthcare Corp. In January of 2017, Optum, a healthcare services division of the payer UnitedHealth Group (UHC), an- nounced it was acquiring Surgical Care Af- filiates Inc. In addition to these high-profile acquisitions, there have been numerous other ASC-related deals during this timeframe. It is interesting to note that, while USPI, Am- surg and SCA are all ASC management com- panies, their acquirers were all very different types of organizations, so these were hardly copycat transactions. e first acquirer was a large health system, the second was a phy- sician staffing company, and the third was a large healthcare payer. is begs the question … what drove the acqui- sitions of the three largest ASC management companies by three very different and distinct buyers? e short answer is that these acquir- ers, as well as numerous Wall Street analysts, believe strongly in the growth prospects of the ASC market. ere has been a major movement in proce- dures shiing from hospital inpatient, to hos- pital outpatient, and now to ASCs. is shi has been driven by numerous reasons, in- cluding high-quality outcomes, convenience for patients and providers, technology that has enabled more sophisticated procedures to be performed in ASCs, and significant cost savings for payers and patients alike. So, Te- net, Envision and Optum/UnitedHealthcare were all determined to gain access to this very important component of the healthcare delivery market. It's a safe bet to assume that many others will be finding creative and ag- gressive methods to access the highly attrac- tive ASC market in the near future. Accord- ing to a 2017 Capitol One survey, 38 percent of healthcare executives said that merger and acquisition transactions are powering their growth plans for this year. e surgery centers that will best capitalize on the positive momentum of the industry are the ones that can grow rapidly and main- tain strong financial margins while maintain- ing high-quality outcomes, with extremely satisfied patients, at cost competitive rates. e centers that can master these fundamen- tals will significantly benefit from the mi- gration of procedures to ASCs and will put themselves in a leadership position amongst the other ASCs. By doing so, these centers will be in a tremen- dous position to control their own destiny, whether that be to remain independent, be- come an acquirer of other ASCs, partner with the local hospital to drive growth or sell to one of the many types of organizations that are hoping to gain a foothold in the rapidly growing ASC market. Regardless of the path chosen, successful ASCs will have numerous excellent options in the years to come. n The 5 Largest Payers in the United States By Eric Oliver H ealthPayerIntelligence compiled a list of the five largest payers based on 2016 net revenue in the United States. These are the five largest payers in the U.S., according to April 2017 data. 1. UnitedHealth Group, $184.8 billion in 2016 net revenue, 70 million subscribers 2. Anthem, $89.1 billion in 2016 net revenue, 39.9 million subscribers 3. Aetna, $63.1 billion in 2016 net revenue, 23.1 million subscribers 4. Humana, $54.3 billion in 2016 net revenue, 14.2 million subscribers 5. Cigna, $39.7 billion in 2016 net revenue, 15 million subscribers n 24 TH ANNUAL MEETING: The Business & Operations of ASCs October 26-28, 2017 | Swissotel | Chicago, Illinois 190 SPEAKERS, INCLUDING 137+ SPEAKERS DIRECTLY FROM SURGERY CENTERS The Best Business-Focused, Strategic Discussions in the ASC Industry with a Special AEU Credit Track Register here at www.beckersasc.com/annual-ambulatory-surgery- centers-conference/ or call 800-417-2035 or email Jessica Cole, jcole@ beckershealthcare.com or Scott Becker, sbecker@beckershealthcare.com KEYNOTES BY Bill Walton, NBA Legend and Basketball Analyst BECKER'S ASC REVIEW Kirk Herbstreit, ESPN's "College GameDay" Analyst and Reporter Alexa von Tobel, Founder and CEO of Learnvest.com, Author of Financially Fearless Andrew Hayek, CEO of OptumHealth, CEO of Surgical Care Affiliates

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