'Private equity experiments' complicate orthopedic consolidation

Orthopedic

EmergeOrtho has taken a different approach to orthopedic consolidation, Scott Hannum, MD, of Wilmington, N.C.-based EmergeOrtho Coastal Region, said. 

Dr. Hannum, president and medical director at EmergeOrtho Brunswick Ambulatory Surgery Center, joined the "Becker's Spine and Orthopedic Podcast" to discuss his outlook on outpatient spine surgery and independent practice consolidation.

EmergeOrtho is part of PELTO Health Partners.

Note: This is an edited excerpt. Listen to the full conversation here.

Question: Where do you see outpatient surgery, specifically in orthopedics, five years down the road? What do you think will be different? What will remain the same?

Dr. Scott Hannum: I think it's going to continue to exponentially accelerate. We as clinicians, first and foremost, want to take great care of our patients. We don't want to put them in harm's way, and we want them to have excellent outcomes. We always thought that patients could recover quicker, but the pandemic really forced us to accelerate that learning curve. Once we proved that we could do it safely, and that patient satisfaction was actually higher and complications rates were actually lower, the sky became the limit.

Spine surgery is a big area. There's a lot of procedures that our spine physicians feel they can safely do in the ASC space, but CMS and other payers have not approved a lot of those codes to be done at the ASC. That's going to change in the next few years. I truly believe we're going to be doing 75% of orthopedic care in an outpatient center. It's only the very sick patients, the trauma patients, the complex revision surgeries that have to be done. 

Q: How do you see this trend of consolidation among orthopedic practices? Do you expect more of the same in the future as more of these groups and independent providers band together?

SH: We've seen an influx of private equity. I don't know if that's going to increase or downturn because not all of the private equity experiments have turned out well. There was initial enthusiasm for that in some markets. But then the second go-around, [someone might be] mostly focused on their investors and their return on their investment, [and] it's not really the same focus as the medical practice group. 

We've taken a different tactic in trying to grow large regionally. We've already started to partner with other large orthopedic groups on the West Coast, in Texas and Indiana to try to come to some commonality to help other large groups become successful. and how do we do that on a national scale, and at the same time enable other smaller orthopedic groups to piggyback off of our successes? We kind of think of ourselves as the private equity in independent orthopedic groups, except we don't want to own your group. We just want to help you grow your success.

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