Financial Instability in the EM Market - My Thoughts
The investors who bet on these groups stand to lose billions—but the hospitals who relied on them as partners face perhaps a more serious challenge. What should you do when the large and supposedly stable group that you’ve partnered with to provide patient care in your emergency department suddenly may not be able to even meet payroll for its clinicians?
In short, it is time to re-evaluate what a “safe choice” means for choosing an EM partner.
Safe used to mean large. It used to mean national.
However, every group that has grown very large very fast did so by taking on private equity investment, This may have seemed wise at the time, but that choice stuck these groups with certain negative downsides:
- Large debt burdens
- Pressure from outside decision-makers
- Less flexibility to meet changing market conditions
The result? Extreme financial instability for anyone else who has used debt to leverage their growth – instability that now threatens service lines with hospital partners.
It’s possible we haven’t seen the end of disruption to the market but while that plays out, what is clear is that it’s long past time to re-evaluate what constitutes a “safe choice” for hospitals when it comes to choosing an EM or HM partner.
Core Clinical Partners has no debt and has grown entirely organically.
We are one of the fastest-growing healthcare companies in the country, and that has come entirely through our reputation for the quality of our existing programs. In the past five years, we have:
- Grown organically so that we have no long-term debt
- Never used an OON strategy so haven’t been hit as hard by NSA
- Improved EM and HM metrics in every new contract start
Core now sees almost a million patients annually across our 35 programs in 10 states, and we have invested in the infrastructure needed to expand further.
If you are concerned about the financial stability of your EM or HM partner, we would love to talk about how Core can offer a safe, stable, and flexible partnership to help you meet whatever challenges arise.