Private equity investors are becoming increasingly interested in healthcare, particularly orthopedic practices. Their influence on healthcare has some physicians split on whether they're beneficial overall.
Two physician leaders discuss how they see outside investors shaping the orthopedic landscape in the U.S.
Louis Levitt, MD. Chief Medical Officer of MedVanta and Vice President of the Centers for Advanced Orthopaedics: I am seriously concerned about who will serve as the caretakers of the future of medicine when it is taken out of the hands of the physicians and given to investors. MedVanta is unique in that it is physician-owned and operated. We are not answerable to financiers or a nonphysician board. Enhancing medicine is our top priority. We are committed to private practice and have proven we can increase our value by delivering high-quality care while lowering costs — not by taking outside investment.
Private equity coming in to "buy" healthcare has a profound short-term effect, but it worries me long term, too. Their foremost goal is to earn as much money as possible and exit the business. They have no long-term commitment or loyalty to the patient or to medicine. That's why we created MedVanta — to empower private practice medicine so providers can remain independent in this landscape that is dominated by corporations and financiers.
Emil Engels, MD. CEO of Aligned Orthopedic Partners: I absolutely believe we will see more MSOs in the future. I follow the PPM market closely, and I have spent time as a business professional in two different specialties. I attend meetings with other physicians, and I can say without hesitation that orthopedics and spine is the most exciting and interesting specialty to be a part of right now. I think there will be tremendous activity with more private equity backed platforms entering the market. In fact, we see a new platform popping up every few months. It's becoming a very competitive landscape, and that's good for physician practices. It's causing disruption. There are going to be companies that succeed and companies that don't. As a result, it's driving innovation and forcing platforms to differentiate themselves from others.