A surge of private equity deals in the spine and orthopedic space during the last few years have yet to see solid payoff, some surgeons say.
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Editor’s note: Responses were lightly edited for clarity.
Question: We’re now several years into the first wave of PE-backed orthopedic deals. What are spine surgeons still waiting to see play out?
Adam Bruggeman, MD. Texas Spine Care Center (San Antonio): Private investment in orthopedic practices has not returned significant revenue on “second-bite” transactions. If those occur, we could see a greater interest among surgeons. Given the quick transition to employed practice, there are less physician practices available for private investment. In the near-term, there doesn’t appear to be a great market for private equity, but that could quickly change with major policy shifts like enacting site-neutral payments.
Pierce Nunley, MD. Louisiana Spine (Shreveport): Several years into the first wave of private equity-backed orthopedic and spine deals, many spine surgeons are still waiting to see whether these consolidations can deliver sustainable long-term value. The early excitement around liquidity events and operational efficiencies has largely faded, as fewer groups are achieving the promised “second bite of the apple.” Many of the initial deals were built on aggressive growth projections and debt structures that are now straining under tighter margins and declining private equity appetite for new acquisitions.
This slowdown has made recruiting more difficult, as younger surgeons hesitate to join practices with uncertain ownership structures or limited equity potential. In some markets, valuations have flattened, and physician partners are questioning whether short-term payouts justify the long-term loss of autonomy and exposure to financial risk. The parallels to the 1990s physician practice management collapse are hard to ignore — overleveraged groups, inflated valuations, and administrative overreach ultimately leading to bankruptcy or forced unwindings. Spine surgeons are watching closely to see whether current portfolios can adapt before history repeats itself.
Vijay Yanamadala, MD. Hartford (Conn.) HealthCare: The private equity consolidation wave in orthopedics, including spine practices, began accelerating around 2018 to 2020. Key unresolved questions include whether the promised operational efficiencies actually materialize without compromising care quality, how physician autonomy evolves under these models, and whether the typical five to seven year exit timeline aligns with sustainable practice development. Early data on outcomes is mixed, with some reports of improved administrative efficiency but concerns about pressure to increase case volumes or procedure selection bias. The sustainability question becomes particularly acute as these investments reach their exit windows and require either IPOs or secondary sales to achieve targeted returns.
Christian Zimmerman, MD. St. Alphonsus Medical Group and SAHS Neuroscience Institute (Boise, Idaho): This year has seen the many parlays and actual sale of spinal implant companies to private equity firms after many years of contractual agreements and customary service that definitely withstood all the ratcheting down of pricing and merger. We are seeing only a transference of leadership and consolidation/removal of duplicity, which is always necessary and welcome. With the current state of healthcare policy, governmental shutdown, payment stalls and a system so stressed and fragile, does this cold actuality forebode further diminishment or the inflection point of further socialization that all fear is coterminous. Conversely, is the correction in over usage and unnecessary application of treatment to diagnosis render its coming day. Perhaps.
