As private equity continues to make its mark on the ASC landscape, many in the industry are questioning the sustainability, and motivations, behind its rapid expansion.
Allyn Wilcock, CRNA, owner of Snoqualmie, Wash.-based Advanced Anesthesia Services and Northwest Healing and Wellness, joined Becker’s to discuss his predictions for private equity in ASCs.
Question: How do you see the role of private equity shifting in the ASC space over the next three to five years? Do you expect more aggressive consolidation or a shift in strategy?
Allyn Wilcox: That’s a good question. I’m not an expert by any stretch, but I would think that as reimbursement continues to decline and the landscape becomes more competitive, private equity may rethink their strategy. It seems like they go all in for a while, then pull back, then go all in again. I’d expect them to pull back over the next few years as they realize how difficult it is to be profitable in this space.
Q: Are there specific issues regarding private equity’s involvement in the ASC space that concern you?
AW: The main concern — probably one most people have — is non-medical people managing a medical entity. In Washington state, where I am, there are laws against it, so they have to set up complicated management structures to allow private equity ownership. The focus on profit over patient care can be a conflict of interest, which often creates tension between the physicians and the accountants.
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