A New York investment group that last year sold its majority stake in United Surgical Partners International to Tenet Healthcare is financing two physician staffing companies that are making acquisitions.
Welsh, Carson, Anderson & Stowe is the capital partner of US Acute Care Solutions and US Anesthesia Partners, each of which bought into physician groups this week.
US Acute Care Solutions—which Welsh Carson launched in May 2015 with Canton, Ohio-based Emergency Medicine Physicians—announced Thursday that it had acquired Ergentus Emergency Service Physicians of Denver. Terms were not disclosed. But the groups said in a release that the acquired physicians “maintain majority ownership and management of their practice.”
According to the US Acute Care Solutions website, the for-profit company now has six groups as founding partners, handling more than 4 million patients annually across 120 sites nationally.
Other recent acquisitions include Emergency Physicians at Porter Hospitals in Denver, Maryland-based MEP Health, Tampa Bay Emergency Physicians and the APEX Emergency Group in Colorado.
Welsh Carson has been a major backer of US Anesthesia Partners for more than three years. The Fort Lauderdale, Fla.-based company, also majority owned by its physicians, acquired East Texas Anesthesiology Associates of Tyler, Texas, on Thursday. Terms were not disclosed.
Scott Mackesy, Welsh Carson general partner and head of the healthcare practice, said physicians are looking for the same benefits of scale as insurers and hospitals.
They need data and information technology to prove quality and receive full payment under new reimbursement models, Mackesy said. Medicare and other payers are moving from fee-for-service to value-based payments that put providers at risk for the quality and efficacy of care.
“The drive for scale is important in any business these days,” he said.
Dr. Shawn Thomas, president of East Texas Anesthesiology Associates, said US Anesthesia Partners was attractive because of “its single-specialty focus, its partnership model, its data-driven culture and its commitment to clinical quality.”
“As a USAP practice, we are gaining valuable insight into the rapidly changing reimbursement environment and IT infrastructure that will position us for continued success,” Thomas said in a release. “This partnership with USAP gives ETAA immediate access to the infrastructure and expertise that we would not be able to build ourselves.”
Mackesy said Welsh Carson has been investing in healthcare companies for decades. US Anesthesia Partners now has about 3,000 physicians and clinicians in Florida, Texas and Colorado.
One of Welsh Carson's big recent successes is United Surgical Partners International, another of its portfolio companies that puts a premium on physician governance of the business, Mackesy said.
In June 2015, Tenet Healthcare bought a majority stake in USPI from Welsh Carson and other investors by paying Welsh Carson more than $400 million in cash and contributing its own ambulatory surgery assets to the new joint venture. When the deal closed, Tenet owned 50.1% of the company.
Tenet, the nation's third-largest investor-owned hospital company, intends to gradually buy out the remaining equity in the business over the next five years, Tenet executives have said during earnings calls this year. USPI is a national leader in outpatient surgeries with about 250 freestanding surgery centers and more than a dozen surgical hospitals.
Welsh Carson has raised $22 billion over its 37-year history, $8 billion of which has been invested in healthcare companies.
Mackesy said the group intends to continue investing in physician practices through its ownership stakes in US Acute Care Solutions and US Anesthesia Partners.
“It's still a fairly fragmented industry,” Mackesy said.
