Ep 41. Kurt Schoppe, MD -- Private equity buying medical groups. What's the deal? (Part 1)

Doctor Money Matters

Welcome to the Doctor Money Matters Podcast. This is a podcast about financial topics related to the healthcare professional. I am your host Dr. Tarang Patel, a diagnostic radiologist in Arizona.

The topic on this episode is the increasing amount of private equity purchasing/partnering of medical practices in the US. We are seeing in in a variety of fields such as radiology, anesthesiology, emergency medicine, dermatology, just to name a few. I wanted to explore why this is happening.

My guest on this episode is Kurt Schoppe, MD a radiologist in Dallas, TX. Kurt is part of the American College of Radiology Economics committee and has experience in the private equity world. On this episode we talk about:

What is private equity?

Why would they be interested in medical practices?

1. Fragmentation of medical practices leads to market opportunities.
2. They are good at logistics, operations and can increase efficiencies to improve returns.
3. They can have access to capital to make discount purchases.
4. They see healthcare as a more predictable way to make money.

Why would a practice want to sell to these firms?

1. FOMO (Fear of Missing Out) Other groups have done so we probably should also.
2. Thinking that your group doesn’t have the expertise to handle a changing healthcare reimbursement model
3. Money right now (particularly for senior partners)

What are they looking for when deciding to buy a practice?

What does this mean for medicine as a profession?

What does this mean for younger physicians?

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You can find Dr. Schoppe on twitter @kurtschoppe

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