Bullish on clinics and outpatient services

A ripple effect of the troubled economy is that patients have to pay more of their medical expenses out of their own pockets. Who can afford a long stay in a hospital? Now they look for price, convenience, quality, and results—all of which clinics and outpatient centers promise. So, it's no wonder that these groups are attracting more investment activity.

For example, private equity investment activity in clinics and outpatient services has more than doubled in the Northeast, according to the PitchBook Platform. This “hot sub-sector” of the healthcare industry accounts for 5% of the deal flow in 2012 to date, up from a 2% share last year.

Value drivers: Quality, convenience, and value will drive value at clinics and outpatient facilities because patients will be hit with higher deductibles and co-pays, regardless of what happens with healthcare reform and economic recovery. Specifically, clinics and outpatient centers should:

• Keep adapting by offering new technology and techniques;
• Focus on services for an aging population, such as physical and rehab services;
• Increase interventional services, such as wellness programs; and
• Implement strategies for the coordination of care.

Also, don’t forget to follow a rule of Business 101 that says to stay “close to the customer.” You do this by researching and understanding the market and geographic area. But don’t forget to examine competitors and search out opportunities with possible partners.