Faculty Bibliography

BACKGROUND:In private equity (PE) buyouts of medical practices, it is common for the PE firm to raise significant levels of debt in order to finance the purchase. This debt is subsequently shouldered by the acquired practice(s). There remains a scarcity of literature quantifying the effect of PE acquisition on the subsequent financial performance of eye care practices. We aim to identify and characterize debt valuations of ophthalmology and optometry private equity-backed group (OPEG) practices, which serve as an indicator of practice financial performance. METHODS:A cross-sectional study from March 2017 to March 2022 was conducted using business development company (BDC) quarterly/annual filings to the Securities and Exchange Commission (SEC). The 2021 BDC Report was used to identify all BDCs actively filing annual reports (Form 10-Ks) and quarterly reports (Form 10-Qs) in the United States in 2021. The public filings of BDCs lending to OPEGs were searched from the inception of the OPEG's debt instrument in a BDC's portfolio and the amortized cost and fair value of each debt instrument were tabulated. A panel linear regression was used to evaluate temporal changes in OPEG valuations. RESULTS: A total of 2,997 practice locations affiliated with 14 unique OPEGs and 17 BDCs were identified over the study period. Debt valuations of OPEGs decreased by 0.46% per quarter over the study period (95% CI: -0.88 to -0.03, P = 0.036). In the COVID-19 pre-vaccine period (March 2020 to December 2020), there was an excess (additional) 4.93% decrease in debt valuations (95% CI: -8.63 to -1.24, P = 0.010) when compared to pre-pandemic debt valuations (March 2017 to December 2019). Effects of COVID-19 on valuations stabilized during the pandemic post-vaccine period (February 2021 to March 2022), with no change in excess debt valuation compared to pre-pandemic baseline (0.60, 95% CI: -4.59 to 5.78, P = 0.822). There was an increase in practices that reported average discounted debt valuations from 20 practices (1.6%) associated with one OPEG to 1,213 practices (40.5%) associated with nine OPEGs (including 100% of newly acquired practices), despite the stabilization of COVID-19-related excess (additional) debt. CONCLUSIONS:Debt valuations of eye care practices have declined significantly post-PE investment from March 2017 to March 2022, suggesting that the financial health of these groups is volatile and vulnerable to economic contractions such as the COVID-19 pandemic. Eye care practice owners must consider long-term financial risks and impacts of subsequent patient care when selling their practice to a private equity group. Future research should assess the impact of secondary transactions of OPEGs on the financial health of practices, practitioner lifestyle, and patient outcomes.

PURPOSE/OBJECTIVE:Physician turnover is costly to health care systems and can affect patient experience due to discontinuity of care. This study aimed to assess the frequency of turnover by ophthalmologists and characteristics associated with turnover. DESIGN/METHODS:A retrospective cross-sectional study. PARTICIPANTS/METHODS:Actively practicing US ophthalmologists included in the Centers for Medicare & Medicaid Services (CMS) Physician Compare and Physician and Other Supplier Public Use File between 2014 and 2021. METHODS:Using two separate publicly available Medicare data sets, we collated data for ophthalmologists associated with practices in each year between 2014 and 2021. We calculated the rate of turnover as (1) annually in each year window and (2) cumulatively as the total proportion of 2014 practices separated by 2021. Multivariate logistic regression analysis was used to identify physician and practice characteristics associated with cumulative turnover. Additionally, we evaluated changes in annual turnover surrounding the Coronavirus disease 2019 pandemic. MAIN OUTCOME MEASURES/METHODS:Ophthalmologist turnover, defined as a change of an ophthalmologist's National Provider Identifier practice affiliation from one year to the next. RESULTS:Of 13,264 ophthalmologists affiliated with 3,306 unique practices, 34.1% separated from at least one practice between 2014 and 2021. Annual turnover ranged from 3.7% (2017) to 19.4% (2018), with an average rate of 9.4%. Factors associated with increased turnover included solo practice (adjusted odds ratio [aOR], 9.59, p<0.01), university-affiliation (aOR, 1.55, p<0.01), practice location in the Northeast (aOR 1.39, p<0.01), and practice size of 2-4 members (aOR, 1.21, p<0.01). Factors associated with decreased turnover included male gender (aOR, 0.87, p<0.01), and greater than 5 years of practice: 6-10 years (aOR, 0.63), 11-19 years (aOR, 0.54), 20-29 years (aOR, 0.36), and ≥30 years (aOR, 0.18) (p < 0.01 for all). In the initial year of the COVID-19 pandemic (2020), annual turnover grew from 7.8% to 11.0%, then fell to 8.7% in the pandemic post-vaccine period (2021). CONCLUSIONS:One-third of US ophthalmologists separated from at least one practice from 2014-2021. Turnover patterns differ by various physician and practice characteristics, the knowledge of which may prove useful when developing strategies to optimize future workforce stability. Because reasons for turnover cannot be solely determined using administrative data, further investigation is warranted given the potential clinical and financial implications.

PURPOSE/OBJECTIVE:Anti-vascular endothelial growth factor (anti-VEGF) medications for intraocular use are a major and increasing cost, and biosimilars may be a means of reducing the high cost of many biologic medications. However, a bevacizumab biosimilar, which is currently pending FDA approval (bevacizumab-vikg), may paradoxically increase the cost burden of intravitreal anti-VEGF, as "off-label" repackaged drug may no longer be allowed per the Drug Quality and Security Act (DQSA). We aim to investigate the potential impact of biosimilars on the health system and patient costs in the US. DESIGN/METHODS:Cost analysis of anti-VEGF medications. PARTICIPANTS/METHODS:Medicare data from October 2022, previously published market share data from 2019. METHODS:Average sales price (ASP) of ranibizumab, aflibercept, and bevacizumab are calculated from Medicare allowable payments. ASPs of biosimilars are calculated from wholesale acquisition costs from a representative distributor. The cost of an intraocular bevacizumab formulation is modeled at $500 and $900/1.25mg dose. MAIN OUTCOME MEASURES/METHODS:Overall costs of anti-VEGF drugs to Medicare Part B and patients. RESULTS:If an intraocular bevacizumab biosimilar were to be priced at $500, costs to Medicare would increase by $457 million from $3.01 billion to $3.47 billion (15.2% increase). Patient responsibility would increase by $117 million from $768 million to $884 million. Similarly, if intraocular bevacizumab were priced at $900, Medicare costs would increase by $897 million to $3.91 billion (29.8% increase), and patient responsibility would increase by $229 million to $997 million. If bevacizumab were $500/dose, switching all patients currently on ranibizumab or aflibercept to respective biosimilars would only compensate for 28.8% of the increased cost. Current prices of ranibizumab and aflibercept biosimilars would have to decrease by an aggregate of 15.7% to $616.80, $1027.97, and $1436.88/injection for ranibizumab 0.3 mg, 0.5 mg, and aflibercept, respectively. CONCLUSIONS:An FDA-approved bevacizumab biosimilar for ophthalmic use could significantly increase costs to the healthcare system and patients, raising concerns for access. This increase in cost would not be offset by ranibizumab and aflibercept biosimilar use at current prices. These data support the need for an exemption of section 503B of the DQSA and continued use of repackaged off-label bevacizumab.

IMPORTANCE/UNASSIGNED:Cataract surgery is one of the most commonly performed surgeries across medicine and an integral part of ophthalmologic care. Complex cataract surgery requires more time and resources than simple cataract surgery, yet it remains unclear whether the incremental reimbursement for complex cataract surgery, compared with simple cataract surgery, offsets the increased costs. OBJECTIVE/UNASSIGNED:To measure the difference in day-of-surgery costs and net earnings between simple and complex cataract surgery. DESIGN, SETTING, AND PARTICIPANTS/UNASSIGNED:This study is an economic analysis at a single academic institution using time-driven activity-based costing methodology to determine the operative-day costs of simple and complex cataract surgery. Process flow mapping was used to define the operative episode limited to the day of surgery. Simple and complex cataract surgery cases (Current Procedural Terminology codes 66984 and 66982, respectively) at the University of Michigan Kellogg Eye Center from 2017 to 2021 were included in the analysis. Time estimates were obtained using an internal anesthesia record system. Financial estimates were obtained using a mix of internal sources and prior literature. Supply costs were obtained from the electronic health record. MAIN OUTCOMES AND MEASURES/UNASSIGNED:Difference in day-of-surgery costs and net earnings. RESULTS/UNASSIGNED:A total of 16 092 cataract surgeries were included, 13 904 simple and 2188 complex. Time-based day-of-surgery costs for simple and complex cataract surgery were $1486.24 and $2205.83, respectively, with a mean difference of $719.59 (95% CI, $684.09-$755.09; P < .001). Complex cataract surgery required $158.26 more for costs of supplies and materials (95% CI, $117.00-$199.60; P < .001). The total difference in day-of-surgery costs between complex and simple cataract surgery was $877.85. Incremental reimbursement for complex cataract surgery was $231.01; therefore, complex cataract surgery had a negative earnings difference of $646.84 compared with simple cataract surgery. CONCLUSIONS AND RELEVANCE/UNASSIGNED:This economic analysis suggests that the incremental reimbursement for complex cataract surgery undervalues the resource costs required for the procedure, failing to cover increased costs and accounting for less than 2 minutes of increased operating time. These findings may affect ophthalmologist practice patterns and access to care for certain patients, which may ultimately justify increasing cataract surgery reimbursement.

PURPOSE/UNASSIGNED:To identify temporal and geographic trends in private equity (PE)-backed acquisitions of ophthalmology and optometry practices in the United States from 2012 to 2021. METHODS/UNASSIGNED:In this cross-sectional time series, acquisition data from 10/21/2019 to 9/1/2021 and previously published data from 1/1/2012 to 10/20/2019 were analyzed. Acquisition data were compiled from 6 financial databases, 5 industry news outlets, and publicly available press releases. Linear regression models were used to compare rates of acquisition. Outcomes included number of total acquisitions, practice type, locations, provider details, and geographic footprint. RESULTS/UNASSIGNED:= 0.20]). CONCLUSIONS/UNASSIGNED:PE acquisitions increased during the period 2012-2021 as companies continue to utilize regionally focused strategies for acquisitions.

INTRODUCTION/UNASSIGNED:Like all United States physicians, ophthalmologists may be implicated in lawsuits claiming fraudulent medical practice. In order to educate, raise awareness, and mitigate fraudulent practice, we reviewed a legal database and analyzed fraud claims in ophthalmology lawsuits. METHODS/UNASSIGNED:A retrospective legal literature review was performed on jury verdicts and settlements from the online legal database LexisNexis Academic from 1985 through 2020 that were filed by or against an ophthalmologist, involved a fraud claim, and included a final decision or settlement. Cases were evaluated for factors including demographics of plaintiffs and defendants, type of fraud claim, ophthalmologist party status (plaintiff or defendant), decision outcome, and amount awarded (when applicable). RESULTS/UNASSIGNED:Of the 27 cases analyzed, all ophthalmologist defendants involved were male and the most common sub-specialty for an ophthalmologist defendant was refractive surgery. The most common fraud type was a fraud claim involving a malpractice lawsuit (12 of 27), followed by contract fraud and billing fraud. While the ophthalmologists in malpractice-related fraud cases experienced more rulings in favor of the defendant on the fraud claims (8 of 12), ophthalmologists in billing fraud cases experienced fewer rulings in their favor (0 of 5). DISCUSSION/UNASSIGNED:Ophthalmology lawsuits involving fraud claims occurred in various settings, including malpractice lawsuits, contract cases, and Medicare and Medicaid billing. Defendants were all male and most commonly refractive surgeons.

INTRODUCTION/BACKGROUND:Private equity firms have recently acquired several large urology practices in the United States. As little is known about these acquisitions, we sought to characterize trends in urology practice consolidation. METHODS:We compiled urology practice acquisition data via financial databases, news outlets, practice websites, and Internet keyword search for the time period January 1, 2011 through March 15, 2021. For each acquisition, we determined the acquiring group, number of employed urologists, practice locations, and status of ancillary services (pathology, radiology, or surgery centers). We estimated workforce effects based on the 2019 American Urological Association workforce census. RESULTS:We identified 69 independent practice acquisitions in the study period, including 19 (28.4%) by hospital systems, 7 (10.4%) by multispecialty physician groups, 23 (34.3%) by urology practices, and 20 (29.9%) by private equity-backed platforms. Private equity firms initially targeted large urology practices (mean of 60.8±32.6 urologists) with ownership of ancillary services and consolidated local market share through acquisitions of smaller practices (mean of 15.9±14.5 urologists). As of March 2021, we estimate that 7.2% of private practice urologists in the U.S. were employed by one of 5 private equity-backed platforms; over 25% of all urologists practicing in New Jersey and Maryland are employed by a private equity-backed platform. CONCLUSIONS:Private equity acquisitions have accelerated to become a dominant form of urology practice consolidation in recent years and have achieved significant market influence in certain regions. Future research should assess the impact of private equity investment on practice patterns, health outcomes, and expenditures.

PURPOSE/UNASSIGNED:To determine the allegation, precipitating medical issue, and outcome of telephone triage focused malpractice litigation among ophthalmologists. METHODS/UNASSIGNED:The WestLaw Edge database was reviewed using terms pertaining to ophthalmology and telemedicine. The search ranged from 4/7/30 to 1/25/22. RESULTS/UNASSIGNED:Of the 510 lawsuits, 3.5% (18/510) met inclusion criteria. 94.5% (17/18) alleged delays in evaluation and/or treatment. 61.1% (11/18) alleged incorrect diagnoses, 38.9% (7/18) claimed improper discussion of risks or informed consent, and 5.6% (1/18) alleged delayed referrals. The precipitating medical issues included retinal detachment in 33.3% (6/18) of cases, post-procedure and post-trauma endophthalmitis in 33.3% (6/18) of cases, ocular trauma without endophthalmitis in 22.2% (4/18) of cases, and bilateral acute retinal necrosis and allergic reactions each accounting for 5.6% (1/18) of cases. CONCLUSION/UNASSIGNED:Telephone triage creates potential malpractice litigation. Delay in in-person clinical evaluation and alleged failure to inform patients of possible irreversible vision loss may lead to potential malpractice litigation. We suggest offering the option of same day in person evaluation and informing the patient how delay may lead to irreversible vision loss.

PURPOSE/UNASSIGNED:Medication samples of anti-VEGF agents can represent a good option for retina specialists to provide timely treatment for newly converted neovascular age-related macular degeneration (nvAMD) while prior-authorizations (PA) are pending. Our study examines the effect of medication sample use (ranibizumab or aflibercept) on future anti-vascular endothelial growth factor (VEGF) agent selection in nvAMD. DESIGN/UNASSIGNED:Retrospective cohort study. PARTICIPANTS/UNASSIGNED:nvAMD patients who underwent an initial anti-VEGF injection with a sample medication were compared to nvAMD control patients who never received a medication sample. METHODS/UNASSIGNED:Charts from 2017 through 2020 were reviewed for data regarding demographics, anti-VEGF agent selection, and visual acuity outcomes for both groups. The utilization of different anti-VEGF agents in each group was compared at various time points using chi-square tests for independence of proportions. MAIN OUTCOME MEASURES/UNASSIGNED:Anti-VEGF agent selection for the first four injections and at one year were examined. RESULTS/UNASSIGNED:injection, and 1 year) in sample (96.2%, 95.9%, 91.9%, 93.4%, respectively), and control groups (98.1%, 94.2%, 94.9%, 87.8%, respectively). Bevacizumab usage was significantly lower among eyes receiving samples relative to controls at the second (1.9% vs. 38.7%, p < .001), third (3.1% vs. 41.3%, p < .001), fourth injections (4.7% vs. 40.4%, p < .001), and at 1 year (0% vs. 33.8%, p < .001). Aflibercept usage was significantly higher in sample eyes relative to controls at the second (78.3% vs. 43.4%, p < .001), third (76.3% vs. 41.5%, p < .001), and fourth injections (76.7% vs. 43.4%, p < .001), and at 1 year (77.0% vs. 52.7%, p < .001). CONCLUSIONS/UNASSIGNED:Sample medications in nvAMD may be initiated for many reasons, including awaiting PA approval. Our study found that eyes receiving a sample anti-VEGF agent (ranibizumab or aflibercept) for their initial injection were less likely to receive bevacizumab at future visits relative to eyes that did not receive an anti-VEGF sample, even after one year of treatment. Given the persistent use of more expensive medications at subsequent injections for patients who were initiated on samples, insurance payors may consider waiving PA requirements for bevacizumab to avoid a paradoxical increase in health-care costs.