Practice management companies acquiring more physician groups

Practice management organizations continue to be an option for hospital-based medical groups looking to sell. These companies have bought several practices of varying sizes during the past few months.

Most recently, IPC: The Hospitalist Company in North Hollywood, Calif., brought its total of practice purchases in 2010 to nine with its Oct. 14 acquisition of Post-Acute Medical Associates in Morristown, N.J., and the Las Vegas practice of internist Muhammad Syed, MD. The company purchased Premier Hospitalists Inc. in St. Louis on Oct. 6 and Hospital Internists in Bristol, Conn., on Aug. 11.

Other publicly traded practice management companies also have been buying.

The American Anesthesiology division of Mednax Inc. in Fort Lauderdale, Fla., announced Oct. 4 that it will acquire Southeast Anesthesiology Consultants, its first purchase of the year. The 90-physician practice provides anesthesia and pain management services to hospitals and ambulatory surgery centers in the Charlotte, N.C., area.

The Pediatrix Medical Group, another division of Mednax, announced Aug. 16 its purchase of the practice of Roberto Villarreal, MD, a two-physician pediatric cardiology group in Laredo, Texas. It is Pediatrix's eighth purchase this year.

TeamHealth in Knoxville, Tenn., acquired Morningstar Emergency Physicians in Oklahoma City, which provides services to hospitals in Oklahoma and Kansas. It is the company's fourth transaction this year.

Practice management organizations are looking to expand their presence in certain markets, according to statements by these companies. Physician practices get access to resources to improve the quality of care. They also get administrative support and information technology.

"As the health care industry evolves and emergency medicine becomes more complex, we recognized that we needed a partner with the resources and infrastructure to help take our group to the next level," said Dale Askins, DO, Morningstar's CEO, in a statement issued by TeamHealth.

Most of these deals were for an unspecified amount of cash, and additional terms were not disclosed. Physicians are employed by the practice management company in some cases, but in others they are independent contractors. This is usually determined by local laws and styles of practice. Practice management companies usually handle administration, own the practice's contracts and take in payments, a portion of which is distributed to the physician group.