Over the past eight years, strategic transactions by physician groups have increased an average of over 20% per year.
The last two years have witnessed even more dramatic average growth. Physician specialties that have received significant investor attention include:
(a) Some “mainstays”, such as primary care, pediatrics, eyecare, retina, dermatology, urology, OBGYN, fertility, gastroenterology and pain, and
(b) Some “newer” targeted areas, such as orthopedics, neurosurgery, cardiology, plastic surgery, med spa, and neurology.
To understand the reason for the trend, it is important to explore the increasing challenges on physician groups in private practice:
Reimbursements from both Medicare and commercial payors have been decreasing over the past several years. This results in physicians having to do more service for less money and ultimately decreased personal income, Medical Economics reports.
Physicians are encouraged to institute value-based reimbursement programs, bundled payment initiatives, risk-based reimbursement, population health, and direct-to-employer programs. These are new, somewhat undefined initiatives that are based in preventive care and management of the overall care for patients requiring treatment. Successful implementation also requires a substantial investment in advanced EHR systems, cutting-edge data analytic capabilities, and experienced care management staff. Read more.
