CaliCatheter

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Hey guys,

Any of you have experience with USAP buyouts? No need for details but was just wondering if among the takeovers, is USAP one of the least malignant?

thanks
 

BLADEMDA

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Hey guys,

Any of you have experience with USAP buyouts? No need for details but was just wondering if among the takeovers, is USAP one of the least malignant?

thanks
Yes.
 
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spike7585

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Bump for this thread. Wondering if anyone cares to share their thoughts or experiences about USAP in general. Feel free to PM details!
 

inflamesdjk02

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I interviewed with USAP in Orlando and it was one of the strangest and most uncomfortable experiences of my entire life.
 

acidbase1

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I don’t see how working for any AMC (aka the man) could be a good experience
 

AdmiralChz

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I don’t see how working for any AMC (aka the man) could be a good experience
Some jobs are really pretty horrible with pay and benefits. That being said, some have very strong pay and competitive benefits (common around where I am doing fellowship). I had co-residents and co-fellows take AMC jobs and are content, yes it happens!

I agree with the above - take MONEY not stock, especially in this day when the stocks appear ridiculously overvalued.
 
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okayplayer

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I am not being snarky, I genuinely want to know the answer to this question: when USAP advertises a "partnership track" position what does that mean exactly? They pay you less for a period of time before you make "partner"?

Very confusing model to me (I imagine by design).
 

FFP

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I am not being snarky, I genuinely want to know the answer to this question: when USAP advertises a "partnership track" position what does that mean exactly? They pay you less for a period of time before you make "partner"?

Very confusing model to me (I imagine by design).
It's a mind game, like "half off, buy now". The same way the product on sale was never worth it's full price, far from it, your "partnership" will be more of a "senior associateship", i.e. you will still pay a lot of money to the mother corporation, like any good... wait... wait... employee!

It's a nice excuse to pay you even less in the beginning, while dangling the carrot in front of your neurotransmitters.

Disclaimer: I have no idea about USAP, but I would be shocked if proven wrong.
 
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amyl

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first off, usap in general, does not want to offer partnership positions... their business plan includes doing away with partnerships and having employees... including former partners becoming employees. I think most of the old guys thought they would be gone but the time that happened. some groups have had considerable trouble hiring qualified people and so are offering partnership tracks... as are non-usap groups in some markets.... they aren't getting the quality people so many groups are swinging back towards partnership.... once the market bares employees only they will swing back that way, if it ever does.
currently at least in my market the business guys don't completely run the show... the doctors still manage many of the divisions as they see fit. imho this makes usap better than other amcs... whether this will be the trend in the future... who knows? the divisions mostly run themselves, pay differently, have different incomes, different vacations, different call schedules. eventually i think they would like to pay everyone the same but that will be very hard as the practice is very diverse.
however the benefits are good and the pay is more than other groups. i was in an employed position with usap and switched to another group for the partnership track. my salary as an associate is reduced but not by too much but my division of usap is competitive to land a spot at and has a reputation for being more fair than other divisions. i have a colleague that was on a partnership track with another division at a dramatically reduced salary and they didn't offer her a partnership. she may not be an ideal anesthesiologist but it is not fair to lead people on for years and then tell them no.
 
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ERRES2288

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things with usap will get interesting beginning of next year.... when the mass exodus occurs. some divisions are better prepared than others...
But what does partnership get you? Just a higher salary? Share of profits or ownership of some kind?
 
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dr doze

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Real partnership gets you parity and some security of ownership. How many real partnerships are out there? Less than there used to be. How much securiry is out there even In true equal partnerships? Less than there used to be.
 

okayplayer

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usap partnership, in general, means higher salary, more vacation and stock options... as well as a vote.... like i said the divisions mostly self govern
So you are all AMC employees but they withhold some pay and vacation from the “non partner” employees to distribute to the “partner” employees? Got it...
:wtf:

At my group (non AMC) being a partner means you own 1 share of the group (1/250th of the group right now) and you vote for the board members annually/can run for a board spot (and vote on a few other issues).
 
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So you are all AMC employees but they withhold some pay and vacation from the “non partner” employees to distribute to the “partner” employees? Got it...
:wtf:

At my group (non AMC) being a partner means you own 1 share of the group (1/250th of the group right now) and you vote for the board members annually/can run for a board spot (and vote on a few other issues).
So there’s no real partnership anymore, pay and vacation are permanently worse, your fate is controlled by some suits far away who don’t know or care about you at all, and your pay is defined by the least these middlemen can get away with paying people rather than being limited by how much you bill? Sounds great! Every group should sell out to AMCs!
 

Ipassgas

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Yes, I'm reviving an old-ish thread.
Yes, these AMCs are the devil.

But my current situation is no longer tenable. The ship has been listing for years, but the bow is finally going under.

USAP has a position in CO I'm interested in due to ties to the area. But I'm not married to it. I currently work in a tiny town, for a tiny AMC.

Why is USAP (specifically) a horrible change to even consider?

Thanks!
 

chocomorsel

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Yes, I'm reviving an old-ish thread.
Yes, these AMCs are the devil.

But my current situation is no longer tenable. The ship has been listing for years, but the bow is finally going under.

USAP has a position in CO I'm interested in due to ties to the area. But I'm not married to it. I currently work in a tiny town, for a tiny AMC.

Why is USAP (specifically) a horrible change to even consider?

Thanks!
It's not horrible for everyone. It works for a lot of people. Find out for yourself. There are a couple of people on this board who have good experiences with USAP or some other AMC.
 

AdmiralChz

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Just like anything else in life, take a close look. There are really good USAP jobs out there (especially for an AMC), but also really terrible ones. If you can, talk with the current docs there, hopefully they will be upfront and honest with you.

Don’t join a group where the surgeons & administration hate your guts. I know this is the case for one major USAP group.
 

C4C

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Yes, I'm reviving an old-ish thread.
Yes, these AMCs are the devil.

But my current situation is no longer tenable. The ship has been listing for years, but the bow is finally going under.

USAP has a position in CO I'm interested in due to ties to the area. But I'm not married to it. I currently work in a tiny town, for a tiny AMC.

Why is USAP (specifically) a horrible change to even consider?

Thanks!
I was with South Denver.

My former partners are much, much, much less happy than they were when we were private practice, but they dry their tears on heaps of cash.

You won't have that same luxury (the piles of buyout cash), but you also won't be burdened by memories of "how things used to be." As far as being a cog goes, being a cog in USAP's machine is probably better than being a cog in Mednax's, or Sheridan's, or Envision's.
 
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aneftp

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I was with South Denver.

My former partners are much, much, much less happy than they were when we were private practice, but they dry their tears on heaps of cash.

You won't have that same luxury (the piles of buyout cash), but you also won't be burdened by memories of "how things used to be." As far as being a cog goes, being a cog in USAP's machine is probably better than being a cog in Mednax's, or Sheridan's, or Envision's.
Just remember mednax (American anesthesiology division) was the high flyer from 2009-2014 cause they had the similiar model as usap (buying lucrative private practices with good payer mix). So mednax got all the good groups to sell out. But there is only so many good groups to sell out.

Than we know the history of usap with welsh Carson Anderson private equity funding the Orlando/Houston/Dallas practice to form usap. So those original 3 practices got the best deals in 2014. Many of the sellouts are just waiting to bail. But the ipo has taken a long time. It’s not a good ipo market for amc. Mednax stock tanking. Envision/amsurg/Sheridan being taking private. Team health has been taken private.

Sure those guys got paid straight cash (roughly 2 million with one of the big original 3 (that is 100% fact). But still a lot of money tied into usap stock for even more money. But it all depends on usap stock ipo.

As for “partnership” track. Yes. Some usap practice do still offer “partnership track”. But it’s not a true partnership track if you know what I mean
 

nycitygas

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Just like anything else in life, take a close look. There are really good USAP jobs out there (especially for an AMC), but also really terrible ones. If you can, talk with the current docs there, hopefully they will be upfront and honest with you.

Don’t join a group where the surgeons & administration hate your guts. I know this is the case for one major USAP group.
Which USAP group is this ?
 

meschler

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I am in the middle of a what can be best described as a hostile USAP takeover and I have to say their business model makes no sense. I say hostile because nobody in my group wants to sell to USAP. But my hospital system has decided that they want USAP to take over all anesthesia departments in all of their hospitals. As best I can tell, USAP is offering free services in some of their money losing anesthesia departments in exchange for more lucrative contracts elsewhere in the hospital system. This sounded a bit like a kickback to me but I leave it to the feds to make that decision if/when USAP is investigated.

I predict that in the long run, USAP stock will tank and if you are involved in a buyout, just assume that the stock portion they pay you will be next to worthless when the time comes when USAP allows you to sell it. Yes, I say allow you to sell it, because they will not let you sell the stock for 5 years or more depending on what you sign. Also keep in mind that you will have to pay taxes on what USAP says they value the stock at and if you take losses after 5 years of holding their stock, my accountant said you cannot write all those losses off against earned income later.

The true value of the USAP stock is very questionable since they determine the value themselves. USAP is private equity and you can't just buy or sell USAP stock on the NYSE. This could be a problem when you want to sell your USAP stock if you can't find anyone willing to buy it. The executives I talked to claim that being private equity is a good thing because it reduces the regulation they have to comply with. I saw this as a bad thing, because some regulation is designed to protect employee/stock holders (think Enron). Without USAP stock being traded on the NYSE or other exchange, the value is whatever they say it is. I have run into this with other private equity companies where there are 50-100 different methods to determine the value of a privately held company stock. You just hire the right stock valuator and tell them "make it look as valuable as possible" and voila, your stock price just keeps climbing. During my discussion with USAP administration they actually compared the value and stability of their stock to Apple! I am not kidding, they think USAP stock is as stable and valuable as the biggest company in the world. Moodys of course disagrees giving USAP the marginal bond rating of B1.

I was on a partnership track in my current group, so I was not offered a full buyout. What I was offered was immediate "partnership" and a "gift" of $150K of stock. But I was assuming I would end up paying 50-75K in taxes on this "gift" which I believed would be worthless in five years when I would be allowed to cash it out. The other problem was the non-compete clause. In my state and in other states like Florida, USAP requires you to sign a 15 mile radius non-compete clause for every facility they have in your state. In my state, USAP has so many contracts, that it meant I would have to leave the state or not work for years if I wanted to leave USAP (even if I just tried them out for a month or two). I talked to some attorneys who assured me that the USAP non-compete clause was not legal or enforceable, but USAP would not take it out of the contract. USAP also claimed that they "almost never enforce" the non-compete clause. So I again asked them to take it out if they don't enforce it. USAP would not. So I gave 60 days notice prior to the hostile USAP takeover and was hired by a different true private group with no plans sell their practice.

The other problem with USAP is you don't have a guaranteed salary. When I worked for Mednax and TeamHealth, I had a fixed guaranteed salary with benefits. When I was working for TeamHealth, one of my ASCs had a pipe break and a flood. The ASC shut down and revenue for the practice plummeted for 2-3 months. But my salary stayed the same. With USAP, it is all based on production and you actually get dinged for using CRNAs (a more efficient model). Since our group uses a lot of CRNAs, our salaries were going to go down quite significantly with a USAP takeover. USAP takes 21+% of everything you earn off the top. So USAP takes no risk and profits whether you make 100K a year or 900K a year. I don't want to ever work for an AMC ever again but if I had to, USAP would be my last choice.

From the perspective of USAP, I was offered a pretty "sweet deal." There was another doc like me on a partnership track who was offered the same deal but both of us turned it down and are leaving the practice. This brings me to my final point which is that USAP has a serious recruiting problem. First of all, their recruiting department is incompetent and they don't return phone calls or e-mails even to highly qualified candidates. So USAP relies on expensive recruiting firms to aggressively hunt down the stupid and uninformed. Even Mednax and TeamHealth don't use recruiting firms.

For new recruits to USAP, I was told they offer the following: a reduced salary for 2 years followed by "partnership." My opinion is that what they call "partnership" is really false advertising. After two years of earning a below market salary, your salary bumps up to close to market (although it is still significantly less than what you would make in a private group doing the same amount of work). You are required to pay USAP 100K after this two year period to become "partner" and in exchange they give you $150K in stock. So you do not have parity, no say in how the group is run and you certainly don't own your group like in a traditional partnership. What they call "partner" is really that you become an employee with a forced stock purchase. In addition to the forced stock purchase, you have this horrendous non-compete clause. So if you sell to USAP, keep in mind that it is difficult to recruit quality anesthesiologists as your partners retire or just leave the practice. Expect to take less vacation, more call and have a lower salary.

All I can say, if you are considering a voluntary sale of your practice to USAP, I think it is a terrible idea. My group was forced to sell and nobody is happy. Two docs and a CRNA are already gone with a likely mass exodus of CRNAs to follow. USAP is so disorganized, they have not presented any of the CRNAs with an employment agreement yet, despite the fact that USAP claims the takeover is imminent. If you are a new grad or an experienced anesthesiologist looking for a new practice, I would avoid USAP based on the non-compete clause alone. If you left USAP and tried to stay and practice in your home state, my guess is that USAP would sue you to scare your other "partners" from leaving. You would win your court case, but trust me (as someone who has been in litigation with an AMC) they will drag it out for years and make you pay 6 figures in legal fees. I have heard people say some private groups are malignant and aren't fair to their partnership track docs. I have to say, in my experience, private groups have been far more fair honest and upfront than any AMC I have ever dealt with.

I would like to close on a positive note. 50% of the practices out there are still private physician owned groups. AMCs are failing because their business model is flawed and financial experts strongly recommend short selling these companies to make a profit. I have noticed a trend where hospital systems are now getting tired of the empty promises from AMCs and are now starting to kick them out of their hospital (like in Charlotte NC). In the 1990s there was a bizarre trend of hospitals buying up physician practices. When this financial model collapsed, these groups went back to physician owned and run groups. Research shows that the best care is delivered by small to medium sized physician owned groups, not multi billion dollar corporations. And I think hospital administrators, at least in some cases are figuring it out. Maybe I am optimistic but I think the AMC trend will pass too and we will eventually revery back to smaller physician owned anesthesia groups.
 

San Marzano

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I am in the middle of a what can be best described as a hostile USAP takeover and I have to say their business model makes no sense. I say hostile because nobody in my group wants to sell to USAP. But my hospital system has decided that they want USAP to take over all anesthesia departments in all of their hospitals. As best I can tell, USAP is offering free services in some of their money losing anesthesia departments in exchange for more lucrative contracts elsewhere in the hospital system. This sounded a bit like a kickback to me but I leave it to the feds to make that decision if/when USAP is investigated.

I predict that in the long run, USAP stock will tank and if you are involved in a buyout, just assume that the stock portion they pay you will be next to worthless when the time comes when USAP allows you to sell it. Yes, I say allow you to sell it, because they will not let you sell the stock for 5 years or more depending on what you sign. Also keep in mind that you will have to pay taxes on what USAP says they value the stock at and if you take losses after 5 years of holding their stock, my accountant said you cannot write all those losses off against earned income later.

The true value of the USAP stock is very questionable since they determine the value themselves. USAP is private equity and you can't just buy or sell USAP stock on the NYSE. This could be a problem when you want to sell your USAP stock if you can't find anyone willing to buy it. The executives I talked to claim that being private equity is a good thing because it reduces the regulation they have to comply with. I saw this as a bad thing, because some regulation is designed to protect employee/stock holders (think Enron). Without USAP stock being traded on the NYSE or other exchange, the value is whatever they say it is. I have run into this with other private equity companies where there are 50-100 different methods to determine the value of a privately held company stock. You just hire the right stock valuator and tell them "make it look as valuable as possible" and voila, your stock price just keeps climbing. During my discussion with USAP administration they actually compared the value and stability of their stock to Apple! I am not kidding, they think USAP stock is as stable and valuable as the biggest company in the world. Moodys of course disagrees giving USAP the marginal bond rating of B1.

I was on a partnership track in my current group, so I was not offered a full buyout. What I was offered was immediate "partnership" and a "gift" of $150K of stock. But I was assuming I would end up paying 50-75K in taxes on this "gift" which I believed would be worthless in five years when I would be allowed to cash it out. The other problem was the non-compete clause. In my state and in other states like Florida, USAP requires you to sign a 15 mile radius non-compete clause for every facility they have in your state. In my state, USAP has so many contracts, that it meant I would have to leave the state or not work for years if I wanted to leave USAP (even if I just tried them out for a month or two). I talked to some attorneys who assured me that the USAP non-compete clause was not legal or enforceable, but USAP would not take it out of the contract. USAP also claimed that they "almost never enforce" the non-compete clause. So I again asked them to take it out if they don't enforce it. USAP would not. So I gave 60 days notice prior to the hostile USAP takeover and was hired by a different true private group with no plans sell their practice.

The other problem with USAP is you don't have a guaranteed salary. When I worked for Mednax and TeamHealth, I had a fixed guaranteed salary with benefits. When I was working for TeamHealth, one of my ASCs had a pipe break and a flood. The ASC shut down and revenue for the practice plummeted for 2-3 months. But my salary stayed the same. With USAP, it is all based on production and you actually get dinged for using CRNAs (a more efficient model). Since our group uses a lot of CRNAs, our salaries were going to go down quite significantly with a USAP takeover. USAP takes 21+% of everything you earn off the top. So USAP takes no risk and profits whether you make 100K a year or 900K a year. I don't want to ever work for an AMC ever again but if I had to, USAP would be my last choice.

From the perspective of USAP, I was offered a pretty "sweet deal." There was another doc like me on a partnership track who was offered the same deal but both of us turned it down and are leaving the practice. This brings me to my final point which is that USAP has a serious recruiting problem. First of all, their recruiting department is incompetent and they don't return phone calls or e-mails even to highly qualified candidates. So USAP relies on expensive recruiting firms to aggressively hunt down the stupid and uninformed. Even Mednax and TeamHealth don't use recruiting firms.

For new recruits to USAP, I was told they offer the following: a reduced salary for 2 years followed by "partnership." My opinion is that what they call "partnership" is really false advertising. After two years of earning a below market salary, your salary bumps up to close to market (although it is still significantly less than what you would make in a private group doing the same amount of work). You are required to pay USAP 100K after this two year period to become "partner" and in exchange they give you $150K in stock. So you do not have parity, no say in how the group is run and you certainly don't own your group like in a traditional partnership. What they call "partner" is really that you become an employee with a forced stock purchase. In addition to the forced stock purchase, you have this horrendous non-compete clause. So if you sell to USAP, keep in mind that it is difficult to recruit quality anesthesiologists as your partners retire or just leave the practice. Expect to take less vacation, more call and have a lower salary.

All I can say, if you are considering a voluntary sale of your practice to USAP, I think it is a terrible idea. My group was forced to sell and nobody is happy. Two docs and a CRNA are already gone with a likely mass exodus of CRNAs to follow. USAP is so disorganized, they have not presented any of the CRNAs with an employment agreement yet, despite the fact that USAP claims the takeover is imminent. If you are a new grad or an experienced anesthesiologist looking for a new practice, I would avoid USAP based on the non-compete clause alone. If you left USAP and tried to stay and practice in your home state, my guess is that USAP would sue you to scare your other "partners" from leaving. You would win your court case, but trust me (as someone who has been in litigation with an AMC) they will drag it out for years and make you pay 6 figures in legal fees. I have heard people say some private groups are malignant and aren't fair to their partnership track docs. I have to say, in my experience, private groups have been far more fair honest and upfront than any AMC I have ever dealt with.

I would like to close on a positive note. 50% of the practices out there are still private physician owned groups. AMCs are failing because their business model is flawed and financial experts strongly recommend short selling these companies to make a profit. I have noticed a trend where hospital systems are now getting tired of the empty promises from AMCs and are now starting to kick them out of their hospital (like in Charlotte NC). In the 1990s there was a bizarre trend of hospitals buying up physician practices. When this financial model collapsed, these groups went back to physician owned and run groups. Research shows that the best care is delivered by small to medium sized physician owned groups, not multi billion dollar corporations. And I think hospital administrators, at least in some cases are figuring it out. Maybe I am optimistic but I think the AMC trend will pass too and we will eventually revery back to smaller physician owned anesthesia groups.
Wow that is quite a write up. Thanks for taking the time to share your experience.
 

caligas

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Wow that is quite a write up. Thanks for taking the time to share your experience.
Agree, thank you for sharing, but take out the part about financial experts recommending short selling, this hurts your credibility.
 
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FFP

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The only thing I am shorting, this time of the year, are my pants.
 
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"I'm betting these companies might be worth nothing," he said, accusing them of employing business models involving "deception or aggressive use of reimbursement."

I believe most of us on this forum agree with the above opinion regarding Anesthesia management companies...except maybe those on this forum benefiting from the deception.
 

BLADEMDA

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"I'm betting these companies might be worth nothing," he said, accusing them of employing business models involving "deception or aggressive use of reimbursement."

I believe most of us on this forum agree with the above opinion regarding Anesthesia management companies...except maybe those on this forum benefiting from the deception.
I've benefited from the deception but these AMCS are still worth nothing IMHO. They run a scam where their revenue is based on the fact they can bill 1.5-2 X as much for the same case as a small, private practice group. This predatory billing practice has put many smaller groups out of business. If insurance companies simply paid smaller groups 3/4 of what they pay USAP, Envision, Mednax, etc the small groups would be able to effectively compete against them.
 
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BLADEMDA

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Not sure why I would want to take half my buyout in USAP stock that may or may not drop precipitously in my vesting period.

To quote Randy Moss: "Straight cash, homey."
Take straight cash if at all possible.
 

narcotics999

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I've benefited from the deception but these AMCS are still worth nothing IMHO. They run a scam where their revenue is based on the fact they can bill 1.5-2 X as much for the same case as a small, private practice group. This predatory billing practice has put many smaller groups out of business. If insurance companies simply paid smaller groups 3/4 of what they pay USAP, Envision, Mednax, etc the small groups would be able to effectively compete against them.
Why will the insurance companies do that? Monopoly?
 

BLADEMDA

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Why will the insurance companies do that? Monopoly?
The insurance companies, to a degree, are promoting these management companies. Instead, the insurance companies should recognize that driving small groups out of business leads to higher costs as the AMCs have mega-contracts. But, insurance companies only care about the short term picture so they will continue to reimburse $60 per unit for a small group while the AMC across town (same city) gets $130 per unit.
 

FFP

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The insurance companies, to a degree, are promoting these management companies. Instead, the insurance companies should recognize that driving small groups out of business leads to higher costs as the AMCs have mega-contracts. But, insurance companies only care about the short term picture so they will continue to reimburse $60 per unit for a small group while the AMC across town (same city) gets $130 per unit.
Because most insurance companies are public companies whose CEOs are incentivized based on the company's short-term earnings, not their long-term healthy growth.

The CEOs don't have a significant percentage of their wealth invested in the business (which would be my #1 requirement before naming anyone CEO for any business), and are incentivized in all the wrong ways by boards who are as short-sighted and disloyal to shareholders as they are, hence nobody couldn't care less what's actually better for the company long-term.
 
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narcotics999

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The insurance companies, to a degree, are promoting these management companies. Instead, the insurance companies should recognize that driving small groups out of business leads to higher costs as the AMCs have mega-contracts. But, insurance companies only care about the short term picture so they will continue to reimburse $60 per unit for a small group while the AMC across town (same city) gets $130 per unit.
I still don't get it. What kind of short term benefit can insurance companies get by promoting mega AMC and paying 130$/unit?

Kickbacks? Nepotism among board members?
 
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FFP

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I still don't get it. What kind of short term benefit can insurance companies get by promoting mega AMC and paying 130$/unit?

Kickbacks? Nepotism among board members?
They will advertise bringing an out-of-network AMC into their network as "growth", and also as a decrease in their future expenses.
 

GigiBuffon

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Not sure why I would want to take half my buyout in USAP stock that may or may not drop precipitously in my vesting period.

To quote Randy Moss: "Straight cash, homey."
1) You don't get a choice in the percentage.
2) They don't give you all ca$h because with a significant (it's less than half) percentage of your buyout in stocks vesting over several years, partners hang on until the stock vests. If it was all cash, a large percentage of partners would leave right away, compromising operations (it takes time to hire new people who are OK with the post-buyout reality).
3) And with each partner sticking around until the stock vests, the company makes money on that partner (they take a percentage of your income post-buyout in perpetuity), so it makes sense for the company to try and keep partners.

The sad part about this construct is that partners sell the future of their practice.
 

IMGASMD

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1) You don't get a choice in the percentage.
2) They don't give you all ca$h because with a significant (it's less than half) percentage of your buyout in stocks vesting over several years, partners hang on until the stock vests. If it was all cash, a large percentage of partners would leave right away, compromising operations (it takes time to hire new people who are OK with the post-buyout reality).
3) And with each partner sticking around until the stock vests, the company makes money on that partner (they take a percentage of your income post-buyout in perpetuity), so it makes sense for the company to try and keep partners.

The sad part about this construct is that partners sell the future of their practice.
Also the future of our speciality. But that’s also part of reality of us right now too.
 

okayplayer

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1) You don't get a choice in the percentage.
2) They don't give you all ca$h because with a significant (it's less than half) percentage of your buyout in stocks vesting over several years, partners hang on until the stock vests. If it was all cash, a large percentage of partners would leave right away, compromising operations (it takes time to hire new people who are OK with the post-buyout reality).
3) And with each partner sticking around until the stock vests, the company makes money on that partner (they take a percentage of your income post-buyout in perpetuity), so it makes sense for the company to try and keep partners.

The sad part about this construct is that partners sell the future of their practice.
Right, but not every AMC "pays" you in stock. Other AMCs do pay you in all cash.
 

Stank811

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Also the future of our speciality. But that’s also part of reality of us right now too.
How so? Maybe apart of the past present and future but majority of positions across the country are still not apart of an AMC and I would argue trending away from AMC type arrangements.
 

sethco

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Not that anything I say in this thread is going to change anyone's mind about USAP and there are some things that I am not going to comment on in a public forum, but I do have some experience. I really dont feel like writing a long diatribe contradicting what others have said on this thread because they may be their experience but it has not been like that for myself. I joined my practice on a partnership track about 6 months before they merged with USAP. Since it was my first job coming out of fellowship, I didn't have the foresight or knowledge to put a buyout clause in my contract, so I was not eligible for any of the stock or buyout that the partners received. I considered leaving at the time of the buyout, but ultimately stayed as I was happy in the practice before the buyout and they let me stay without signing the non-compete until my "partner" track was finished (So I could see how the practice would be affected post-buyout without any geographical restriction in case I decided it wasn't for me). That was about 2.5 years ago. I continued with the practice as nothing changed clinically. We continue to be physician-only. Our total partner compensation continues to be above the 90th percentile for MGMA (Going off 2015 data as I dont feel like paying for the newest) and we continue to thrive as a practice in the area. Are compensation for the associates is what I would consider very fair and better than what most academic places offer. Everybody who has been on the partner track, has made partner (and Yes, I still call it Partners even though Shareholder may be more accurate). As a group, we still remain in control of our operations. I have an equal vote as my colleagues in how the group is run. Is everything completely peachy? Of course not, I don't think there are any practices out with at least some issues or things that they can improve on. But, overall, I am very happy with my decision to stay.
 
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nolagas

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How do you define fair pay? Do they make the same per hour as you to do the same work? Are they associates because they chose not to do a partnership track or because you want to make money off of them forever?
 

Howard888

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So I’ll be the first to say USAP is a much better situation than Mednax or Sheridan however I wouldn’t do it over a private group, especially if you were not part of the buy out.

In response to the positive USAP review: you mentioned all the reasons why USAPs model is the only AMC model I think will survive long term.

However, as someone who was not part of the buy out, ask yourself, are you ok giving up whatever percentage your group agreed upon for the rest of your career (20-40% depending on the group).

Has USAP done enough and is doing enough to justify that lost revenue?

Have they done enough to justify you paying six figures to become a “shareholder”?

USAP sells the idea of income recovery which they have done at some of their sites. They accomplish this through higher contracted rates, some cost savings (billing, malpractice insurance, decreased benefits, etc), and lastly, as the other post suggested, by cornering smaller groups into joining and folding them into the parent group of the region who sees the most benefit from acquiring the small group.

For your group, even if you reach income recovery, ask how much of that income recovery could the group have done on its own? If the group never achieves income recovery, ask yourself, why am I giving such a huge proportion of the money I bill to USAP?

Ask yourself, how is your group going to respond to the mass retirements once stocks are vested? How will your groups culture be once there are more partners who were not part of the buy out than who were part of the buy out.

Ask yourself, if there is some sweeping economic change that leads to a large reduction is Anesthesia charges, are you still ok giving up that percentage of income?

Again, USAP is the best of the AMCs, but unless your group is in a survival situation that requires USAP, I do not think it should be considered.

And I especially wouldn’t choose to work at USAP if I wasn’t part of the buy out. Young physician asked to give up a significant proportion of their income in perpetuity, spend six figures to buy a stock that is further diluted everyday, and receive none of the buy out. That’s crazy, there are still many private jobs.
 

sethco

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How do you define fair pay? Do they make the same per hour as you to do the same work? Are they associates because they chose not to do a partnership track or because you want to make money off of them forever?
Ok, I'll bite. About 50th percentile MGMA for new hires. Associates is a catch all term for people that are on partner track and people that choose not to be on partner track. However, all of our partner track people do Cardiac cases. 3 year partner track, which has been the case with the group for past 20 years meaning all current partners have done a 3 year track to get where they are now.


It sounds from your tone of "make money off of them forever" that you don't agree with partner tracks and feel all new hires should have immediate voting rights and financial parity as those that worked to make the group what it is today. Is that correct?
 

nolagas

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Ok, I'll bite. About 50th percentile MGMA for new hires. Associates is a catch all term for people that are on partner track and people that choose not to be on partner track. However, all of our partner track people do Cardiac cases. 3 year partner track, which has been the case with the group for past 20 years meaning all current partners have done a 3 year track to get where they are now.


It sounds from your tone of "make money off of them forever" that you don't agree with partner tracks and feel all new hires should have immediate voting rights and financial parity as those that worked to make the group what it is today. Is that correct?
Not at all. I think partnership track is fine and mommy-track jobs are fine too. What I mean by “make money off of them forever” is when you need another partner but you hire an associate because you can get away with paying someone less even though they do the same work (or maybe more) with no intention of ever treating them equally. If your division doesn’t do that then great, but there are definitely USAP practices that do.
 
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