Consolidation to become more mainstream in orthopedics — 2 surgeon predictions

Practice Management

Orthopedic practice consolidation is expected to increase in the coming years as hospital systems, insurers and private equity firms continue to recruit physicians and smaller physician-owned practices explore strategic options in response to the COVID-19 pandemic.

Two spine surgeons predict how consolidation will affect the future of the orthopedic field:

Andrew Cordover, MD. Andrews Sports Medicine & Orthopaedic Center (Birmingham, Ala.): I believe that in the next few years, the consolidation trend will continue. It will be likely that there will be fewer small to mid-sized practices that are not owned by a hospital, private equity or some other entity. Consolidation of these groups will probably become more mainstream. However, there are some merits to the model. The new, value-based payment models for both federal and private payers require sophisticated management and data analysis that most practices do not have available. Additionally, collective negotiating and maintenance of quality metrics may be easier to demonstrate.

Consolidation can provide opportunities for vertical integration through surgery centers or other ancillary services, as capital and additional practice resources will be more readily available through these groups. Another benefit would be the economies of scale that may be realized operationally or through group purchasing of supplies, employee benefit packages and various insurance policies. Also, volume will be driven by larger contracts.  

Adam Bruggeman, MD. Texas Spine Care Center (San Antonio) and CMO of MpowerHealth (Addison, Texas): Spine care delivery will clearly shift toward the outpatient setting as payers see cost savings and providers have greater opportunity for ownership in surgery centers. Trends are shifting toward employment models and consolidation of practices, as we see hospital systems, private equity and insurance companies continue to employ a greater percentage of the workforce. Also pushing this trend is the growing attitude of physicians who prefer to avoid the ever-growing practice management requirements and increasing burden of preauthorization associated with payers.

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