Speaker: Practices Seeking PE Partnership Should Know Benefits, Downsides

A private equity transaction may make sense for an orthopedic private practice that finds it increasingly difficult to reduce costs and increase revenue in today’s financial and health care environment, a speaker said.

During a symposium at the American Association of Hip and Knee Surgeons Annual Meeting, R. Michael Meneghini, MD, discussed ways that private equity (PE) and outside capital can provide orthopedic surgeons with some needed extra financial help, reports Orthopedics Today.

He said results of a recent survey by the American Academy of Orthopaedic Surgeons showed about 48% of orthopedic surgeons remain in private practice. Although this comes as good news, Meneghini said these same physicians are the ones who are most feeling the effects of unsuccessful strategies to curb expenditures and maintain or increase revenue today.

Groups faced with such challenges may want to consider a PE transaction, and they should carefully consider the advantages and disadvantages of this type of agreement, he said. Read more.

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