Your Primer to Healthcare Mergers and Acquisitions

The Outpatient Way (Part II): 5 Areas In Which Investors Are Jumping Aboard

Jul 19, 2016

by Tom Schramski

By Tom Schramski, PhD, CM&AA and Marc Toth, CM&AA 

Volume 3 Issue 15 July 19, 2016

As we discussed in the last issue of SalientValue, “the outpatient way” is having a profound effect on the delivery of healthcare services in many areas.  The reasons are multiple – the emergence of physician entrepreneurs, “sovereign consumerism,” shifting care economics, medical technology improvements, and improved outcomes – and they are increasingly driving outpatient models in diverse healthcare verticals.  The end result is growing investor and buyer interest.

Several areas where investors are now focusing include the following:

Addictions treatment: The classic model of addiction treatment was based on 12-step programs that often relied on inpatient intervention for 28 or more days, often in settings divorced from community life.  In the past few years this has shifted based on evidence that intensive outpatient (IOP), partial hospitalization (PHP), medical assisted treatment (MAT), sober living, and other long-term supports are more effective over time than classic inpatient programs.  Moreover, this shift has included the addition of more evidence-based therapeutic programs as an adjunct, or even replacement, for 12-step programs.

Urgent care centers/retail clinics: Urgent care centers (UCCs) have been proliferating for several years, with significant investor activity fueling high EBITDA multiples and growth.  Physician entrepreneurs are continuing to open small UCCs that can be rapidly expanded throughout the US, leading to new buyers and even to specialized UCCs that include new options, such as a strong behavioral health component.

Ambulatory surgery centers: The ambulatory surgery center (ACS) movement enjoys continued investment support, though de novo activity remains constant in certain geographic areas.  In some cases, ASCs have become very specialized and operate in tandem with existing inpatient facilities. Patient preference, reduced costs, good outcomes, and reduced risks of hospital-acquired infections are also prompting a migration of total joint replacement surgeries (such as for hips and knees) to the ambulatory arena.

Gastroenterology clinics: As we wrote in our April 26th article, “I Took Uber To My Colonoscopy,” gastroenterology outpatient clinics are rapidly expanding in scope to include non-critical surgical procedures such as endoscopies, which can be delivered within existing or adjoining clinical facilities at a reasonable cost to the patient, with decreased risk of infection compared to large, multi-purpose hospitals.  Commercial insurance companies are increasingly favoring these types of options.

Vascular office based labs – Vascular office based labs (OBLs) are drawing strong investor interest because they offer significant possibilities for managing critical care in an outpatient setting, including the use of innovative medical devices (e.g. catheters) that can be safely implanted in these settings (see our May 24th issue of SalientValue).  Vascular OBLs also herald integration with a more comprehensive approach to wound care, among other examples.

Our belief is that “the outpatient way” will expand dramatically in the next few years, encouraging strong buyer investment along with improved outcomes for patients and customers.  This will change the entire healthcare landscape, leading to remarkable opportunities for entrepreneurs.

Tom Schramski

Tom Schramski PhD, CM&AA


Tom was the Founder and Managing Partner of VERTESS. He was a Certified Merger & Acquisition Advisor (CM&AA), consultant, and Licensed Psychologist with over 35 years of very successful national experience in the healthcare marketplace, including co-founding and building a $25 million behavioral health/disabilities services company. Tom represented sellers and investors across the healthcare spectrum and was recognized for his executive leadership in the 2005 Entrepreneur of the Year issue of Inc. Tom passed away in December 2018.

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