Private Equity Investment in Surgical Care.

Objective: To characterize the extent of private equity (PE) investment affecting surgical care.

Background: Over the last decade, investor-backed, for-profit PE groups have invested in health care at an unprecedented rate, but the breadth of these investments affecting surgical practice remains largely unknown.

Methods: Four nationally representative databases were used to identify all merger/acquisitions involving surgical practices between 2015 and 2019, determine PE investment in those transactions, and link the acquisitions with a physician data set.

Results: A total of 1542 unique transactions were identified, of which 539 were financed by PE. Fifty-eight transactions were then classified into their respective categories within surgical care: digestive disease, orthopedics, urology, vascular surgery, and plastic/cosmetic surgery. These transactions accounted for 199 practice sites and 1405 physicians, averaging 24.2 physicians per transaction. Acquisition activity peaked in 2017, with a total of 63 practices involved. Digestive disease, urology, and orthopedic surgery accounted for the most activity. General surgeons were involved in a small share of the digestive disease practice acquisitions. Three "surgery-adjacent" categories were also identified: anesthesiology, ambulatory surgery centers, and surgical staffing firms. Among these, anesthesia was the largest category in terms of practices (194) and physicians (2660) involved in transactions across the study period. Medical Service Organizations were a key mechanism through which PE firms invested in surgical care.

Conclusions: PE has engaged in substantial investment within surgical specialties, creating increased practice consolidation. These investments affect all levels of medical care and have notable implications for patients, practitioners, and policymakers.