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Private Equity Health Care Acquisitions – February 2022

In light of the growing investor interest in health care and the risks associated with private equity ownership of health care companies, the Private Equity Stakeholder Project will be tracking private equity-backed health care acquisitions. Below is a list of private equity health care buyouts and add-on acquisitions completed or announced during February 2022. We will continue to track acquisitions on a monthly basis.

See January 2022 acquisitions here.

Private equity firms are continuing to invest in physicians’ practices and medical groups, including gastroenterology, dermatology, orthopedics, and podiatry. The acquisitions are part of a growing trend of private equity firms buying up medical practices.

A 2020 study published in JAMA found that private equity firms acquired 355 physician practices between 2013 and 2016, with the number of deals accelerating each year. The most commonly represented medical groups in the study were anesthesiology (19.4%), multispecialty (19.4%), emergency medicine (12.1%), family practice (11.0%), and dermatology (9.9%). There were also increases in the number of cardiology, ophthalmology, radiology, and obstetrics/gynecology practices.[1]

Because private equity firms are barred from directly owning physicians’ practices in most states, firms often buy or create platform companies that partner with physician-owned medical groups. These physician management companies (PMC) typically manage the business administration of medical practices, including insurance contracting and billing.[2]

PE Physicians’ Practice Acquisitions – February 2022

CompanyTypePE Firm(s)Add-on Platform
Alteon HealthPractice managementApollo Global Management, TowerBrook Capital PartnersUS Acute Care Solutions
Pivot Health SolutionsPhysical therapyBDT Capital PartnersAthletico Physical Therapy
Southern Orthopaedic Surgeons (Montgomery)OrthopedicsFFL Partners, Thurston GroupMississippi Sports Medicine and Orthopaedic Center
Alliant Physical Therapy GroupPhysical therapyH.I.G. CapitalCORA Health Services
Middlesex Orthopedic SurgeonsOrthopedicsKohlberg & CompanyOrthopaedic & Neurosurgery Specialists
Orthopaedic Surgical AssociatesOrthopedicsKohlberg & CompanyOrthopaedic & Neurosurgery Specialists
Epiphany DermatologyDermatologyLeonard Green & Partners 
Reston Podiatry AssociatesPodiatryNew MainStream CapitalFoot & Ankle Specialists of the Mid-Atlantic
Caravan HealthPractice managementNew Mountain CapitalSignify Health
Digestive Health SpecialistsGastroenterologyOMERS Private EquityGastro Health
Greater Boston GastroenterologyGastroenterologyOMERS Private EquityGastro Health
Middlesex GastroenterologyGastroenterologyOMERS Private EquityGastro Health
Forefront DermatologyDermatologyOMERS Private Equity, Partners Group n/a

 

Of critical concern is the impact of private equity ownership of physicians’ practices on the prices. A February 2022 study published in JAMA found that payments to anesthesia providers were higher at practices that contracted with a PMC, particularly if the PMC was backed by a private equity firm.[3]

The study found that for patients who received anesthesia in a facility with a PMC contract, amounts paid increased by 16.5%, and unit prices standardized by procedure complexity and duration climbed by 18.7%. For private-equity-owned PMCs, allowed amounts and unit prices increased by 26.0% and 25.6% respectively.[4]

The study author, Ambar La Forgia, told Healthcare Dive: “One way PMCs may command higher prices is by amassing market share and by developing better negotiating expertise. PE-backed PMCs may also have had stronger incentives to create short-term returns for investors relative to those without PE investments.”[5]

The study raises concern that private equity ownership of physician practice management companies may lead to increased prices and higher premiums.

February 2022 PE Buyouts

CompanyTypePE Firm(s)
EVERSANAClinical trials and consultingACE & Company
IntriConMedical suppliesAltaris Capital Partners
Probo MedicalMedical devicesAvista Capital Partners
Thomas ScientificMedical suppliesBroad Sky Partners
Agency for Medical InnovationsMedical suppliesEvoco
GarramonePlastic surgeryHidden Harbor Capital Partners
Epiphany DermatologyDermatologyLeonard Green & Partners
Medical Knowledge GroupPharmaceutical marketingNovo Holdings
Forefront DermatologyDermatologyOMERS Private Equity, Partners Group
SOC Telemed (NAS: TLMD)TelehealthPatient Square Capital
Us Mobile Health ExamsHealth examsPotomac Equity Partners
American Outcomes ManagementHome health, infusionRidgemont Equity Partners
Clario (Drug Safety and Pharmacovigilance Services Solutions)PharmaceuticalsStanley Capital
Blue Cloud Pediatric Surgery CentersDentalThe Rise Fund
Oceans HealthcareBehavioral healthWebster Equity Partners

 

February 2022 PE Add-On Acquisitions

CompanyTypePE Firm(s)Add-on Platform
Viatris (Biosimilar Business)PharmaceuticalsADQ, Tata Capital, The Goldman Sachs Group, True NorthBiocon Biologics
Analytical WizardsHealth techAdvent International, Spectrum EquityDefinitive Healthcare
Alteon HealthPractice managementApollo Global Management, TowerBrook Capital PartnersUS Acute Care Solutions
National Billing PartnersRevenue cycle managementAquiline Capital PartnersNational Medical Billing Services
TapCloudHealth techArdan Equity, Leonard Green & Partners and TPGWellsky
Med Express Ambulance ServiceEmergency servicesArdian, Koch Equity Development, Kohlberg Kravis RobertsGlobal Medical Response
Conduent (Midas Health Analytics Solutions)Health techAres Management, Charlesbank Capital Partners, Clearlake Capital Group, SkyKnight CapitalSymplr
TrylClinical trials, health techBallast Point Ventures, Flexpoint FordYPrime
Pivot Health SolutionsPhysical therapyBDT Capital PartnersAthletico Physical Therapy
Mahajan TherapeuticsBehavioral healthBPEA Private Equity, Webster Equity PartnersBayMark Health Services
SIEHTEye careCentre PartnersVision Innovation Partners
PELITASRevenue cycle managementClearlake Capital GroupnThrive
Premier Care AssociatesMedicare Advantage plan providerCrestline InvestorsGenuine Health Group
Tangible Solutions 3DMedical devicesDentressangle, FloracMarle
Audacious InquiryHealth techDragoneer Investment Group, Hellman & Friedman, JMI Equity, Pohlad Companies and Tao Capital PartnersPointClickCare
Arranta BioBiotechEQT, Ardian EquityRecipharm
Southern Orthopaedic Surgeons (Montgomery)OrthopedicsFFL Partners, Thurston GroupMississippi Sports Medicine and Orthopaedic Center
TrierHealthClinical trialsGHO CapitalVelocity Clinical Research
SyftHealth techGolub Capital BDC, Temasek Holdings, Warburg PincusGlobal Healthcare Exchange
Alliant Physical Therapy GroupPhysical therapyH.I.G. CapitalCORA Health Services
Middlesex Orthopedic SurgeonsOrthopedicsKohlberg & CompanyOrthopaedic & Neurosurgery Specialists
Orthopaedic Surgical AssociatesOrthopedicsKohlberg & CompanyOrthopaedic & Neurosurgery Specialists
FlowMetricContract research organiztionKonza Valley Capital, Vitruvian PartnersKCAS Bioanalytical & Biomarker Services
Walton Eye CareEye careLeon Capital GroupPhysician Directed Partners
Humanscale HealthcareMedical devicesLevine Leichtman Capital PartnersCapsa
Medical Purchasing SolutionsPharmaceuticalsLinden Capital Partners, The Jordan CompanyYoung Innovations
Reston Podiatry AssociatesPodiatryNew MainStream CapitalFoot & Ankle Specialists of the Mid-Atlantic
Caravan HealthPractice managementNew Mountain CapitalSignify Health
Digestive Health SpecialistsGastroenterologyOMERS Private EquityGastro Health
Greater Boston GastroenterologyGastroenterologyOMERS Private EquityGastro Health
Middlesex GastroenterologyGastroenterologyOMERS Private EquityGastro Health
MediCopy ServicesMedical IT servicesParthenon Capital PartnersMRO
Resilience Treatment CenterBehavioral healthRegal Healthcare Capital PartnersLightfully Behavioral Health
Klara (Enterprise Systems)TelehealthWarburg PincusModernizing Medicine
CTSdatabaseClinical trialsWebster Equity PartnersJBR Clinical Research

 

February 2022 PE De Novo Acquisitions

CompanyTypePE Firm(s)Add-on Platform
Five NC ABA centersBehavioral healthArsenal Capital PartnersHopebridge Autism Therapy Centers
Overland Park, KS businessHospiceH.I.G. CapitalSt. Croix Hospice
St. Croix South Dakota BusinessHospiceH.I.G. CapitalSt. Croix Hospice

[1]https://jamanetwork.com/journals/jama/article-abstract/2761076

[2]https://ldi.upenn.edu/our-work/research-updates/private-equity-investment-in-physician-practices/

[3]https://jamanetwork.com/journals/jamainternalmedicine/article-abstract/2789280

[4]https://jamanetwork.com/journals/jamainternalmedicine/article-abstract/2789280

[5]https://www.healthcaredive.com/news/corporate-backed-anesthesiology-practices-paid-more/619665/

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