Skip to main content
Subscribe
  • Sign Up Free
  • Login
  • Subscribe
  • News
    • Current News
    • Providers
    • Insurance
    • Government
    • Finance
    • Technology
    • Safety & Quality
    • Digital Health
    • Transformation
    • ESG
    • People
    • Regional News
    • Digital Edition (Web Version)
    • Patients
    • Operations
    • Care Delivery
    • Payment
    • Midwest
    • Northeast
    • South
    • West
  • Opinion
    • Bold Moves
    • Breaking Bias
    • Commentaries
    • Letters
    • Vital Signs Blog
    • From the Editor
  • Events & Awards
    • Awards
    • Conferences
    • Galas
    • Virtual Briefings
    • Webinars
    • Nominate/Eligibility
    • 100 Most Influential People
    • 50 Most Influential Clinical Executives
    • Best Places to Work in Healthcare
    • Excellence in Governance
    • Health Care Hall of Fame
    • Healthcare Marketing Impact Awards
    • Top 25 Emerging Leaders
    • Top Innovators
    • Diversity in Healthcare
      • - Luminaries
      • - Top 25 Diversity Leaders
      • - Leaders to Watch
    • Women in Healthcare
      • - Luminaries
      • - Top 25 Women Leaders
      • - Women to Watch
    • Digital Health Transformation Summit
    • ESG: The Implementation Imperative Summit
    • Leadership Symposium
    • Social Determinants of Health Symposium
    • Women Leaders in Healthcare Conference
    • Best Places to Work Awards Gala
    • Health Care Hall of Fame Gala
    • Top 25 Diversity Leaders Gala
    • Top 25 Women Leaders Gala
    • - Hospital of the Future
    • - Value Based Care
    • - Hospital at Home
    • - Workplace of the Future
    • - Digital Health
    • - Future of Staffing
    • - Hospital of the Future (Fall)
  • Multimedia
    • Podcast - Beyond the Byline
    • Sponsored Podcast - Healthcare Insider
    • Video Series - The Check Up
    • Sponsored Video Series - One on One
  • Data Center
    • Data Center Home
    • Hospital Financials
    • Staffing & Compensation
    • Quality & Safety
    • Mergers & Acquisitions
    • Data Archive
    • Resource Guide: By the Numbers
    • Surveys
    • Data Points
  • Newsletters
  • MORE+
    • Contact Us
    • Advertise
    • Media Kit
    • Jobs
    • People on the Move
    • Reprints & Licensing
MENU
Breadcrumb
  1. Home
  2. Providers
June 11, 2018 01:00 AM

Envision Healthcare to be acquired by KKR

Shelby Livingston
  • Tweet
  • Share
  • Share
  • Email
  • More
    Reprints Print

    (Updated at 3:45 p.m.)

    Private equity firm KKR on Monday said it would buy physician staffing company Envision Healthcare for $9.9 billion in cash and assumed debt.

    The companies expect the deal to close in the fourth quarter of 2018.

    The announcement comes after Nashville-based Envision announced a strategic review to enhance shareholder value late last year. Envision's board of directors reached out to 25 potential buyers to purchase all or parts of the company, and concluded that KKR's proposal offered the best value, according to the announcement. The deal was approved unanimously by Envision's board.

    Last month, Reuters reported that Nashville-based Hospital Corporation of America was in talks to buy Envision in a joint bid with KKR, but HCA did not end up participating in the deal.

    "Envision's leadership team, including both the board and management, have been singularly focused on driving value for our shareholders and have taken decisive action in furtherance of that goal, including the implementation of a comprehensive operational improvement plan and a robust review of strategic alternatives," Envision CEO Christopher Holden said. "Today's announcement reflects the extensive efforts by our team to explore all opportunities to deliver value for our shareholders."

    Envision officials were not immediately available on Monday for an interview.

    Envision, with annual revenue of $7.8 billion, is the nation's largest physician staffing firm with 25,000 physicians and other medical practitioners who staff hospital departments, including the emergency room, radiology, anesthesiology and neonatology. The company is the product of a 2016 merger with Nashville-based staffing company and ambulatory surgery center operator Amsurg. Envision reported a net loss of $232.5 million in 2017.

    Envision's national footprint makes it an attractive asset for a private equity firm. Physician services firms are usually not capital intensive and they generate cash flow, analysts said. Envision also owns more than 250 outpatient surgery centers. Many companies are looking to invest in ambulatory care as health insurers encourage patients to seek care away from expensive inpatient settings.

    Envision and KKR also have a history. The staffing firm last year sold its ambulance business to a subsidiary of KKR for $2.4 billion to focus on physician staffing and ambulatory surgery centers.

    Envision in recent months has come under fire for sending patients big out-of-network ER bills. The company was the focus of a July 2017 study by researchers at Yale University that found that hospitals outsourcing emergency department operations to Envision's EmCare unit between 2011 and 2015 saw increases in the rates of out-of-network doctor's bills, tests ordered and patients admitted to the ED. That prompted scrutiny from Sen. Claire McCaskill (D-Mo.) and led to investor lawsuits.

    Envision contends that the Yale study focused on a small number of hospitals and isn't representative of its business. It said it has also made changes to its business model since 2015—the last year of the Yale study period.

    Analysts said the KKR-Envision deal is unlikely to impact patients, despite some speculation that Envision becoming a private company would reduce ER billing transparency.

    "I would not think there would be a big impact (on patients) whether it's a publicly traded or private company," said Richard Close, Nashville-based equity analyst with firm Canaccord Genuity. "The physicians are still physicians. They are service-minded."

    Envision has been trying to crawl out from under its tarnished reputation. It is working to secure in-network contracts for most of its physicians. The company in May said it had moved nearly $500 million of out-of-network revenue to in-network status in 2017, and planned to convert another $250 million in revenue to in-network status in 2018. The company said it expected less than 5% of its revenue to be out-of-network by the end of this year.

    Envision has also been locked in a dispute with insurer UnitedHealth over ED billing issues. The company UnitedHealth in March for allegedly violating a contract by refusing to add Envision doctors to its network and lowering payment rates despite Envision's objections. UnitedHealth then created a website to describe how Envision's "outrageous billing practices" drive up costs for hospitals and patients.

    A judge in April dismissed Envision's lawsuit, saying the companies must work out their dispute through arbitration. The same month, UnitedHealth said it would end its contract with Envision no later than Jan. 1, 2019.

    Letter
    to the
    Editor

    Send us a letter

    Have an opinion about this story? Click here to submit a Letter to the Editor, and we may publish it in print.

    Recommended for You
    finance graphs hospital
    Primary care physicians' pay growth picked up in 2022: MGMA
    Home cancer treatment faces challenges post-pandemic
    Home cancer treatment faces challenges post-pandemic
    Most Popular
    1
    More healthcare organizations at risk of credit default, Moody's says
    2
    Centene fills out senior executive team with new president, COO
    3
    SCAN, CareOregon plan to merge into the HealthRight Group
    4
    Blue Cross Blue Shield of Michigan unveils big push that lets physicians take on risk, reap rewards
    5
    Bright Health weighs reverse stock split as delisting looms
    Sponsored Content
    Modern Healthcare A.M. Newsletter: Sign up to receive a comprehensive weekday morning newsletter designed for busy healthcare executives who need the latest and most important healthcare news and analysis.
    Get Newsletters

    Sign up for enewsletters and alerts to receive breaking news and in-depth coverage of healthcare events and trends, as they happen, right to your inbox.

    Subscribe Today
    MH Magazine Cover

    MH magazine offers content that sheds light on healthcare leaders’ complex choices and touch points—from strategy, governance, leadership development and finance to operations, clinical care, and marketing.

    Subscribe
    Connect with Us
    • LinkedIn
    • Twitter
    • Facebook
    • RSS

    Our Mission

    Modern Healthcare empowers industry leaders to succeed by providing unbiased reporting of the news, insights, analysis and data.

    Contact Us

    (877) 812-1581

    Email us

     

    Resources
    • Contact Us
    • Advertise with Us
    • Ad Choices Ad Choices
    • Sitemap
    Editorial Dept
    • Submission Guidelines
    • Code of Ethics
    • Awards
    • About Us
    Legal
    • Terms and Conditions
    • Privacy Policy
    • Privacy Request
    Modern Healthcare
    Copyright © 1996-2023. Crain Communications, Inc. All Rights Reserved.
    • News
      • Current News
      • Providers
      • Insurance
      • Government
      • Finance
      • Technology
      • Safety & Quality
      • Digital Health
      • Transformation
        • Patients
        • Operations
        • Care Delivery
        • Payment
      • ESG
      • People
      • Regional News
        • Midwest
        • Northeast
        • South
        • West
      • Digital Edition (Web Version)
    • Opinion
      • Bold Moves
      • Breaking Bias
      • Commentaries
      • Letters
      • Vital Signs Blog
      • From the Editor
    • Events & Awards
      • Awards
        • Nominate/Eligibility
        • 100 Most Influential People
        • 50 Most Influential Clinical Executives
        • Best Places to Work in Healthcare
        • Excellence in Governance
        • Health Care Hall of Fame
        • Healthcare Marketing Impact Awards
        • Top 25 Emerging Leaders
        • Top Innovators
        • Diversity in Healthcare
          • - Luminaries
          • - Top 25 Diversity Leaders
          • - Leaders to Watch
        • Women in Healthcare
          • - Luminaries
          • - Top 25 Women Leaders
          • - Women to Watch
      • Conferences
        • Digital Health Transformation Summit
        • ESG: The Implementation Imperative Summit
        • Leadership Symposium
        • Social Determinants of Health Symposium
        • Women Leaders in Healthcare Conference
      • Galas
        • Best Places to Work Awards Gala
        • Health Care Hall of Fame Gala
        • Top 25 Diversity Leaders Gala
        • Top 25 Women Leaders Gala
      • Virtual Briefings
        • - Hospital of the Future
        • - Value Based Care
        • - Hospital at Home
        • - Workplace of the Future
        • - Digital Health
        • - Future of Staffing
        • - Hospital of the Future (Fall)
      • Webinars
    • Multimedia
      • Podcast - Beyond the Byline
      • Sponsored Podcast - Healthcare Insider
      • Video Series - The Check Up
      • Sponsored Video Series - One on One
    • Data Center
      • Data Center Home
      • Hospital Financials
      • Staffing & Compensation
      • Quality & Safety
      • Mergers & Acquisitions
      • Data Archive
      • Resource Guide: By the Numbers
      • Surveys
      • Data Points
    • Newsletters
    • MORE+
      • Contact Us
      • Advertise
      • Media Kit
      • Jobs
      • People on the Move
      • Reprints & Licensing