Orthopedic surgeons, long seen as fiercely independent, are rapidly catching up with other specialist physicians, such as dermatologists and ophthalmologists, in selling control of their practices to private equity investment firms, Kaiser Health News reports. They hope to grab a bigger chunk of the surging market in outpatient surgery and maintain their position as one of the highest-paid specialties in medicine — $633,620 was the average compensation for orthopedists in 2021. For older doctors, the upfront cash payout and the potential second payout when the business is flipped offers the promise of a posh retirement.
Proponents say private equity investment has the potential to reduce total spending on musculoskeletal care and improve quality by helping physicians move more procedures to cheaper outpatient surgery centers, which have less overhead. It also could help the doctors shift to value-based payment models, in which they charge fixed amounts for whole episodes of care, such as total joint replacements and spine surgeries — receiving bonuses or penalties from insurers based on cost and quality performance.
But critics warn that profit-hungry private equity ownership alternatively could result in higher prices for patients and insurers, more unnecessary surgery, and less access to care for patients on Medicaid or those who are uninsured or underinsured.
