ST. LOUIS — Christina Green hoped cataract surgery would clear up her blurred vision, which had worsened after taking medication to fight her breast cancer.

But the former English teacher said her surgery in 2019 with eye consultants failed to achieve 20/20 vision or correct her astigmatism, despite an out-of-pocket fee of $3,000 for surgical upgrading of astigmatism. Green, 69, said she ended up feeling more like a dollar sign for the practice than a patient.

“You are a cow among a herd as you move from this station to this station to this station,” she said.

Ophthalmology Consultants is part of EyeCare Partners, one of America’s largest private equity-backed eye care groups. It is headquartered in St. Louis and has some 300 ophthalmologists and 700 optometrists in its networks in 19 states. The band declined to comment.

Switzerland-based Partners Group bought EyeCare Partners in 2019 for $2.2 billion. Another eye care giant, Texas-based Retina Consultants of America, was established in 2020 with a $350 million investment from Webster Equity Partners, a Massachusetts-based private equity firm, and now says on its site Web that it has 190 doctors in 18 states. Other private equity groups are establishing regional footprints with practices such as Midwest Vision Partners and EyeSouth Partners. Acquisitions have increased so much that private equity firms now routinely sell practices to each other.

Over the past decade, private equity groups have gone from taking over a handful of practices to working with up to 8% of the nation’s ophthalmologists, said Dr. Robert E. Wiggins Jr., chairman. from the American Academy of Ophthalmology.

They are raiding the practices of eye care doctors nationwide as money-making opportunities grow in medical eye care as the US population ages. Private equity groups, backed by wealthy investors, are buying up these practices — or unifying them in franchise-style deals — in hopes of increasing profit margins by cutting administrative costs or changing strategies commercial. They often then resell the practices at a higher price to the next highest bidder.

The profit potential for private equity investors is clear: Much like paying to upgrade airline seats to first class, patients can choose expensive add-ons for many eye procedures, such as cataract surgery. For example, doctors can use lasers instead of manually cutting eye lenses, offer multifocal eye lenses that can eliminate the need for glasses, or recommend the astigmatism fix Green said has been sold. Often patients pay for these extras out of pocket, a health care salary not limited by insurance reimbursement negotiations. And these services can take place in outpatient and free-standing surgery centers, both of which can be more cost-effective than in hospital settings.

Investments provided by private equity groups can help doctors market and expand their practices, as well as negotiate better prices for drugs and supplies, Wiggins said. But he warned that private equity firms’ quest to maximize profitability risks compromising patient care.

“Problems are piling up and driving up prices,” added Aditi Sen, director of research and policy at the nonprofit Health Care Cost Institute, which provides health care economics data and analysis. .

Yashaswini Singh, a health economist at Johns Hopkins University, and colleagues analyzed private equity acquisitions in ophthalmology, gastroenterology and dermatology and found that practices charged 20% extra insurance, on average $71, more after acquisition. Private practices have also seen a substantial increase in the number of new patients and more frequent returns from former patients, according to their research, published Sept. 2 in the medical journal JAMA.

An analysis by KHN also found that private equity firms are investing in doctors’ offices that are prescribing two of the most common eye drugs for macular degeneration at high rates, meaning doctors are likely seeing a lot of patients and are therefore more cost effective.

KHN analyzed the top 30 prescribers of the macular degeneration eye drugs Avastin and Lucentis in 2019 through a database from the Centers for Medicare & Medicaid Services. Private equity firms then invested in 23% of Avastin top influencers and 43% of Lucentis top influencers, far more than the 8% of ophthalmologists in which private equity currently has a stake. Retina Consultants of America, for example, has invested in the practices of four of Avastin’s top influencers and nine of Lucentis’ top influencers.

“The private equity model is a model that focuses on profitability, and we know they don’t pick practices randomly,” Sen said.

She noted that the volume of patients would be attractive for private equity, as well as the idea of ​​investing in practices using expensive Lucentis prescriptions, which cost around $1,300 per injection. Additionally, she said, after being privately acquired, physicians could potentially shift their prescribing habits from the cheaper Avastin that costs around $40 to Lucentis, improving the bottom line.

Retina Consultants of America did not respond to requests for comment.

Last summer Craig Johnson, then 74, decided it was finally time to have cataract surgery to fix his deteriorated eyes. He decided to go to CVP Physicians in Cincinnati, calling it “the local creme de la creme for having eye surgery” as they do “100 a day”. The firm was already part of a private equity investment, but has since been acquired by another investor, giant EyeCare Partners, for $600 million.

Johnson, although pleased with the results of his operation, was unaware of the hand-cut version of the operation, the cheaper but equally effective alternative to using a laser. Johnson used private insurance because he was still working, and he said it resulted in more than $2,000 in payouts for each eye. Laser surgery typically costs more than manual surgery and may not be covered by insurance plans, according to the American Academy of Ophthalmology.

Johnson said a salesperson, along with a doctor, guided him through options to improve his eyesight.

“Older people are a vulnerable population because they’re on a fixed income, they’re a bit older, they trust you…you’re wearing a white coat,” said Dr Arvind Saini, an ophthalmologist who runs an independent practice. in California. San Diego County.

Christina Green’s 2019 cataract surgery at private equity-backed eye consultants in St. Louis failed to achieve 20/20 vision or correct her astigmatism, she says — despite $3,000 fee for surgical astigmatism upgrade. Green, a former English teacher, says she felt more like a dollar sign than a patient.

Matt Kile for KHN

Many patients are unsure if private equity investors have a stake in the practices they choose because they are often referred to them by another doctor or have an eye emergency.

David Zielenziger, 70, felt lucky to get a quick appointment with one of NY’s vitreoretinal consultants after his retina detached. Zielenziger, a former business journalist, didn’t know he was associated with Retina Consultants of America. He loved his doctor and had no complaints about the emergency care he received and continued to go there for follow-ups. Medicare covered just about everything, he said.

“It’s a very busy practice,” he said, noting it’s spread to more places, which must make investors happy.

In 2018, Michael Kroin co-founded Physician Growth Partners, a group that helps doctors sell their practices to private equity firms, to capitalize on the explosion of interest. Eye care is one of the biggest areas of investment, he said, because specialist healthcare services apply to such a large market of people.

Sixteen of the 25 private equity firms identified by industry tracker PitchBook as the biggest healthcare investors have taken stakes in optometry and ophthalmology practices, according to an analysis by KHN.

Kroin expects private equity investment in practices will only continue to accelerate due to competition from the “1,000-pound gorilla” of hospitals also acquiring practices and the bureaucracy of reimbursement insurance is forcing more doctors to seek outside help. “If you don’t grow, it will be difficult to survive and earn a level of income similar to what you had before,” he said.

Some healthcare experts worry that private equity firms could end up with a bag of too much debt if other companies don’t want to buy the practices they’ve invested in, which could lead to those practices shutting down and , finally, even more consolidation.

“I’m not sure most medical practices are so inefficient that you can make 20% more profit out of them,” said Dr Lawrence Peter Casalino, head of the health policy and economics division at the Weill Cornell Medicine Department of Population Health. Sciences. And, he said, investors expect to resell to a buyer who will pay more than they paid. “If it doesn’t work, everything collapses.”

KHN investigative reporter Fred Schulte contributed to this article.

KHN (Kaiser Health News) is a national newsroom that produces in-depth journalism on health issues. Along with policy analysis and polling, KHN is one of the three main operating programs of KFF (Kaiser Family Foundation). KFF is an endowed non-profit organization providing information on health issues to the nation.

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