FEATURE


McCaslin says. “They know they are at risk of losing a lot of revenue as surgical care transitions to physi- cian-owned ASCs. After largely dis- missing surgery centers in the past, they are recognizing the need to get into the ASC business.”


are


Hospitals and health systems also experiencing


increased pres-


sure from private payers to create an ASC portfolio, says Regina Boore, RN, CASC, senior vice president and executive consultant for Progres- sive Surgical Solutions in Incline Vil- lage, Nevada. “Some payers are say- ing they will no longer pay for certain surgical procedures in the hospital. If hospitals want to be in a position to provide all procedures to patients, they will need to add ASCs.” Surgery Center Cedar Rapids in


Transaction Trends in the ASC Market


‘The next 10 years might be the best 10 years to own a surgery center’ BY ROBERT KURTZ


I


f you operate an ASC, do not be surprised if you hear from any


number of organizations asking if you will engage in a conversation about the future of your center. The reason, says Michael McCaslin, prin- cipal at Somerset CPAs and Advisors in Indianapolis, Indiana: ASCs are a hot commodity.


“As we are seeing accelerated movement from inpatient to outpa- tient care, we are seeing accelerated interest in surgery centers,” McCaslin says. “Over the past year, transac- tions involving ASCs have been on the rise.”


While the migration of proce- dures to the ambulatory setting is a significant contributing factor to the increased interest in surgery centers, Robert Eisenberg, an ASC industry veteran in Reisterstown, Maryland, believes ASCs are on so many radars because of one main concept: value.


10 ASC FOCUS AUGUST 2021 | ascfocus.org “That is the big catch word,” says


Eisenberg, who has held leadership positions at ASCs, surgery center management companies and health systems. “ASCs can deliver on the 'quadruple aim' better than any other delivery platform. They can optimize performance, reduce costs, improve the patient experience and increase the wellbeing of the workforce. We know we need to increase the value of healthcare and find the right plat- forms to do so. ASCs are leading the way here.”


The Big Players


McCaslin says the bulk of interest in ASCs is coming from three groups: hospitals and health systems, ASC management and development com- panies, and private equity companies and the platforms they back. “First in this line is clearly the hospitals and health systems,”


Cedar Rapids, Iowa, is a joint ven- ture between physicians and a hospi- tal. Julie Brinegar, CASC, an ASCA board member and the ASC’s execu- tive director, says she expects to see more of those kinds of partnerships. “Hospitals are continuing to see their payer contracts and allowed amounts decrease significantly year over year. ASC joint ventures represent an opportunity to generate revenue.” Eisenberg says hospitals and health systems are increasingly target- ing underutilized, independent ASCs, which can be beneficial for both par- ties. “These ASCs can benefit from the influx of cases that come from the hospital and the value the health sys- tem brings for payer contracting and supply chain cost reduction. On the other side, hospitals get what is basi- cally a turnkey operation that reduces capital costs. This is especially impor- tant coming out of the pandemic as there are not a lot of capital dollars available for health systems.” While McCaslin says the number


of ASC management and develop- ment companies has declined over the past several years, largely due to con-


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