Doctors Leave Private Equity
Michael Homerick@homerick
+7.9%
since Sep 9
The idea
I'm a physician, and I am building scheduling software for independent groups. I think doctors can buy the business support they need without selling the practice. Scheduling, billing, credentialing, staffing and communications are things a small group can rent. As those tools get better and cheaper, staying independent becomes more practical. My bet is on the businesses that make that possible. I want exposure to the platforms and services that help small physician groups run well and compete. This is a three to five year idea, with a meaningful reserve and gradual entry.
What it owns
- These companies provide the business infrastructure independent physician groups need to operate without a private equity owner, handling contracting, administration, and care management while doctors keep their practice names. · Privia Health GroupIt provides the business and contracting infrastructure independent physicians need while keeping their practice names, and wins if implemented providers and new independent groups keep signing up faster than groups sell to larger rollups., Astrana HealthIt organizes independent physician associations and handles their contracting and administration, exactly the service small independent groups need to compete without a private equity owner., Evolent HealthIt provides analytics and care management that independent physician groups cannot build themselves, enabling smaller practices to compete on value-based contracts with payers.24%
- Other · SGOV20%
- Billing and payments are the first function independent groups outsource and never bring back in-house, creating durable demand for software platforms that handle claims and revenue cycle management. · Waystar HoldingIt operates the claims and payments software that independent practices run their billing on after outsourcing that function on day one, and grows as claim volumes on its platform expand., PhreesiaIt handles patient check-in and front-desk payment collection, the daily cash-flow function small practices outsource first, and grows by adding clients and expanding revenue per location.16%
- Small medical practices need lightweight software solutions that don't require dedicated IT infrastructure, creating a large addressable market for simple, affordable tools. · DoximityIt is the communication and clinical software physicians actively use daily without IT department approval, and holds value while physician engagement and pharma advertising spending stay strong., Weave CommunicationsIt provides phone, texting, and scheduling tools that small practices acquire as credit-card software, making growth dependent on expanding the small-office customer base and keeping cancellation rates low., EverCommerceIt sells practice management and payments software to small service businesses including medical and wellness practices, positioning itself to benefit as small-practice formation continues and its healthcare vertical expands.14%
- Large hospital operators and surgery center networks benefit regardless of how physician staffing evolves, since they contract with independent groups more cheaply than with private equity-owned staffing firms. · Tenet HealthcareIts surgery center partnership model with independent physicians benefits as doctors leave private equity employers and seek places to operate that do not own them., HCA HealthcareIt contracts with independent physician groups at lower rates if they replace private equity staffing firms, or employs doctors directly if staffing consolidation continues, so it benefits from both outcomes., Surgery PartnersIt co-owns surgery centers with independent physicians, the model that benefits as doctors leave private equity employment and seek physician-aligned operators., Universal Health ServicesIt is a large hospital operator that secures cheaper physician contracts as private equity staffing middlemen decline, providing stability regardless of how independent physician groups evolve.13%
- New independent physician groups immediately outsource HR, benefits administration, and credentialing rather than build these functions themselves, creating recurring revenue for back-office service providers. · HealthEquityIt administers HSA accounts and employee benefits that a forty-doctor group would never build in-house, and grows as HSA assets and account counts expand., HealthStreamIt provides credentialing and compliance software that handles re-credentialing after physicians leave private equity staffing groups, and grows as hospitals and practices standardize on its platform., TriNet GroupIt operates as a full-service HR and employee benefits department for small companies, exactly the rented function newly independent physician groups need on day one.13%
- Thin-staffed independent groups rely on locums and per diem coverage to survive volume swings without maintaining excess headcount, but this position is sized small because staffing rates are normalizing from pandemic peaks. · AMN Healthcare ServicesIt supplies locums and fill-in coverage that small independent practices need to absorb staffing gaps without permanent headcount, though this position is sized small as locums demand from independent groups must stabilize after pandemic staffing rate peaks.2%