OSLI Retina

August 2020

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Practical Retina August 2020 · Vol. 51, No. 8 425 This allows PE firms to be in an ideal position with sig- nificant amounts of equity to invest and debt markets offering them the ability to access low-cost leverage. 4 THE RISE OF PRIVATE EQUITY IN OPHTHALMOLOGY Bain & Company describes the goal of PE in the following way: "All PE firms want to create value as quickly as possible — to grow revenue and take out cost — and a strong playbook helps to accomplish that." 5 When looked at through this lens, it makes a lot of sense that PE's playbook includes ophthalmic practices. Our practices are attractive because the aging population coupled with expanded health care coverage offer ro- bust demand for services. 6 We are often independent of hospital systems and own alternative revenue streams such as surgery centers and optical shops. As a field, we are also fragmented in a way that allows for PE firms to acquire varied size groups and create a portfolio of prac- tices making it easier for them to streamline processes (such as billing and purchasing) and improve efficien- cies through standardization. 2 VALUE AND THE POTENTIAL MISMATCH BETWEEN PE AND PHYSICIANS We know that PE firms want to "create value." We should understand that this value is not necessarily Figure 1. U.S. private equity (top) and mergers and acquisitions (bottom) deal flows in health care.

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