Urology Practice Acquisitions by Private Equity Firms from 2011–2021

Abstract

Introduction: Private equity firms have recently acquired several large urology practices in the United States. As little is known about these acquisitions, we sought to characterize trends in urology practice consolidation. Methods:We compiled urology practice acquisition data via financial databases, news outlets, practice websites, and Internet keyword search for the time period January 1, 2011 through March 15, 2021. For each acquisition, we determined the acquiring group, number of employed urologists, practice locations, and status of ancillary services (pathology, radiology, or surgery centers). We estimated workforce effects based on the 2019 American Urological Association workforce census.Results: We identified 69 independent practice acquisitions in the study period, including 19 (28.4%) by hospital systems, 7 (10.4%) by multispecialty physician groups, 23 (34.3%) by urology practices, and 20 (29.9%) by private equity-backed platforms. Private equity firms initially targeted large urology practices (mean of 60.8AE32.6 urologists) with ownership of ancillary services and consolidated local market share through acquisitions of smaller practices (mean of 15.9AE14.5 urologists). As of March 2021, we estimate that 7.2% of private practice urologists in the U.S. were employed by one of 5 private equity-backed platforms; over 25% of all urologists practicing in New Jersey and Maryland are employed by a private equity-backed platform.Conclusions: Private equity acquisitions have accelerated to become a dominant form of urology practice consolidation in recent years and have achieved significant market influence in certain regions. Future research should assess the impact of private equity investment on practice patterns, health outcomes, and expenditures.

Private equity in ophthalmology: lessons from other specialties

“…In the beginning, private equity firms acquired larger urology practices (mean of 61 urologists) with ownership of ancillary services. Later, private equity firms consolidated through acquisitions of smaller practices (mean of 16 urologists) [37 ▪▪ ]. Nie et al [37 ▪▪ ] estimate about 7.2% of urologists work for private equity-backed firms.…”

“…Later, private equity firms consolidated through acquisitions of smaller practices (mean of 16 urologists) [37 ▪▪ ]. Nie et al [37 ▪▪ ] estimate about 7.2% of urologists work for private equity-backed firms. Over 25% of all urologists practicing in New Jersey and Maryland are employed by private equity platforms [37 ▪▪ ].…”

Private Equity Acquisition in Ophthalmology and Optometry: A Time Series Analysis of the Pre-COVID, COVID Pre-Vaccine, and COVID Post-Vaccine Eras

“…Private equity (PE) investment is a major driving force in healthcare today, offering consolidation and the ability to scale up independent practices to compete in a dynamic market. For example, one recent study found that in Maryland and New Jersey, more than 25% of urologists were employed by a private equity backed platform company[1]. However, recent trend of private equity (PE) backed consolidation in ophthalmology and the healthcare system as a whole continues to raise concerns regarding patient care, physician autonomy, and overall health system costs[2, 3].…”

Financial Health of Private Equity-Backed Ophthalmology and Optometry Groups: an Analysis of Debt Valuations

“…1 PE acquisition continues to play a greater role in healthcare in the United States, particularly affecting procedure-based, outpatient-heavy fields such as dermatology, urology and ophthalmology. 2-4…”

“…1 PE acquisition continues to play a greater role in healthcare in the United States, particularly affecting procedure-based, outpatient-heavy fields such as dermatology, urology and ophthalmology. [2][3][4] PE investment has implications not only on practice management strategy, but also the long-term economic wellbeing of practices. PE buyouts often involve raising substantial amounts of debt, often 70 to 80 percent of the purchase price, to meet the cost of acquisition.…”