Heavy Hitters Weigh In

Representatives from three top companies in the ambulatory surgery center (ASC) industry weighed in this morning on the general state of the industry and their respective businesses in general.

Thomas Hall, CEO, NovaMed; Michael Snow, CEO, Surgical Care Affiliates; and William Wilcox, CEO, United Surgical Partners International, all shared the current demographics of their companies and how each are functioning this year.

MWE’s Jerry Sokol asked Snow to update attendees on the state of SCA. Snow said he is pleased to announce, “Since Feb. 2007, we have not had to deliver any more bad news.” Most of the heavy lifting is behind us, he noted.

Sokol asked if SCA is involved in acquisitions yet. Snow replied, “By its very nature, a carve-out creates opportunity. We basically are a carve-out. We’re not ready for something on a huge scale, but we will be soon.”

Wilcox noted that USPI is “trying to walk before it attempts to run.” He discussed the company's going private from public and the challenges and successes it faces in doing so. While struggling with debt and access to capital, the company's current focus is joint ventures (JVs) with hospitals and taking on centers with a quick projected profitability, he said. He noted that the company’s centers are 60 percent JVs with hospitals. He also pointed out that many ASCs “wait until it is too late” to seek help.

On a high note, Hall said NovaMed’s move from ophthalmology-specialized to acquiring multi-specialty facilities has “opened a big door for us.” He noted that if centers they partnered with came to them with no ophthalmology, they added it to the mix. “This has become a grand slam for us,” he said.

Eric Zimmerman, MWE partner, then asked each panelist to weigh in on the current challenge on Capitol Hill concerning specialty hospitals and physician ownership.

Snow noted that SCA owns three such hospitals. He advised that anyone looking to open such a venture should do it now, although he admitted it “sounds a little Vegas.”

Wilcox wrapped it up best: “Physician ownership challenges will be strong this year and well into the future," he said.

--Jennifer Schraag, reporting live from the 2008 Symposium. Stay tuned for regular updates throughout the day.

Photo caption: MWE partners Jerry Sokol (l) and Josh Kaye (r).

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