Hey, in the Business of EP session two, we are going to be talking about ASCs and private equity, both of which have been very hot topics over the last several years as EP transforms. I'm Scott Greenberg, and I'm one of the co-chairs from Baylor College of Medicine. And I'm Dr. Foster, I'm in private practice in Huntsville, Alabama. It is my pleasure to welcome you to San Diego and the Heart Rhythm Society 2025, the 46th annual meeting of the Heart Rhythm Society. If you have not already done so, please download the HRS 2025 mobile app from your preferred app store. This is how you can participate in the live Q&A session during the sessions. Please scan the QR code on the screen to access this Q&A. When using the mobile app, log in with your HRS credentials. Please note that visual reproduction of the Heart Rhythm Society 2025, either by video or still photography, is strictly prohibited. All right, we will start with session number one. I'm happy to introduce David Kennesburg from Florida Heart Rhythm Specialists, who's gonna talk to us about how to start an ASC, the costs, the regulations, and the pitfalls. Good afternoon, everyone. I'm very honored to be part of this esteemed group of doctors and electrophysiologists. Hopefully my slides will come up. If not, I'll just be talking from the hip. All right, so I was asked to talk about how to start an ASC, the costs, the regulations, and the pitfalls. So this is not Merriam-Webster. This is the DK definition of what an expert is, and I'm by definition an expert in this topic. It's a person that's made a lot of mistakes, recognizes them, learns from them, and is gonna try to share in the next nine and a half minutes my experience with all of you. So when you decide that you wanna take the leap and have an ASC, you need to decide in what geography you're gonna do that, and what the catchment area will be for that location. And that's very important, because geography determines pair mix. Then you just need to decide on a building. You need to decide if you're gonna buy a building or lease a building. So when I embarked on this journey in 2016, I bought the wrong building. I bought a building that the ceilings were too low. So if you're gonna buy an ASC building, you should buy a defunct supermarket. Otherwise, you can lease space. Then you gotta figure out who's gonna build it. Are you gonna go out and get yourself a contractor, an engineer, an architect? Are you gonna take plans to the city and try to fight for your parking spaces and get variances when they don't work out? Or are you going to find an expert to do that? I recommend highly that you try the latter. Then you need to decide who your partners are. And in order for an ASC to work, and I'll talk a little bit more about this at the end of the talk, you need strategic partners and you need physician-owner partners. And without both of those things, you likely will not succeed or be as successful as you'd like to be. And then you need to decide, aside from all of this, who's gonna build it, who's gonna run it? Are you gonna run it? Are you gonna take care of HR? Are you going to take care of your pharmacy license? Are you gonna take care of anesthesia? Are you going to take care of all the regulatory responsibilities, OSHA and whatever it may be? Or are you gonna find an expert to do that as well? So when you set out to do this, from the day that I thought that I wanted to have an ASC with my partner, Dr. Ahmed Osman, till the day I actually stepped foot in the ASC, it was years. Just because you stepped foot in the ASC, then you gotta figure out, it's a business, how to make it break even and eventually become profitable. So in order to do that, you need to create a pro forma. You need to understand who or what type of physicians will use the center. Will it be a cardiac ASC alone or will you have other somewhat lucrative procedures being done in your ASC? For instance, these little devices that stimulate the spine for back pain, they pay as much as a BIVICD. So maybe you wanna include those or maybe you wanna have vascular surgery. There's experience locally with putting in barostim in an ASC, which is very lucrative as well. You need to have projections about case volume, case types. Initially, we were only talking about devices and PCI and peripherals. But nowadays, and hopefully Arash will make a very good argument, no doubt he will, we're gonna have ablations very soon too. So what are the costs? So are you gonna buy land? Are you gonna buy a building? Are you gonna lease it? The cost currently in a project that I know about going on is about 850 a square foot to build it out. That's without any equipment. Permitting, architect, engineer, fluoroscopy, anesthesia, medical gases, recording system, ice, staff, mapping system, ablation equipment, a backup generator could cost you a million bucks and you need it, you need to have that. Then you come up with plans. The plans need to include a certain number of pre-op areas and post-op areas for every OR. You need to have different areas for an autoclave or if you're gonna have disposable equipment, you have to have an area for dictation, an area for a kitchen. You need to understand what you need for this space and an architect who's done this before is important. So James Patterson, I don't know why, but life is usually more complicated than the plans that we make and it's true. It took years before I was able to actually step foot in my building. Then there's structural considerations. You see this big transformer here? When it blew during a hurricane once, my center was out of commission for a week. So and then where do you put the ACs and the HVAC and all these things that we teach each other in med school. All right, so finally we get inside the center and this is actually the foyer and waiting area of my small one OR center here in pretty South Florida and which I didn't design. My partner has a much better eye for design and then this is the single room OR with a fluoroscopy suite and this is a small area for recording and so forth. Now, there are policies that are in place to make sure everything is secure. Now, there are policies and standards. You need full center backup, you need smoke dampers, you need the room separated, you need HVAC, air conditionings, all kinds of stuff that you need someone to help you with. You also need a shower so that when you come to the lab after a morning in CrossFit, you can do your cases. Now, there's regulatory. Now, there's AHCA, ACCA, JACO, there's the city, there's the county, building, parking, fire marshal, OSHA, pharmacy, laboratory, you need all this stuff. Now, you get your grand opening. This was my grand opening, Thursday, December 13th of 2018 and we were all excited, we had a big party, we had a lady play the cello, it was beautiful and now we had to decide what we needed to do next. So, we needed to staff the place, clinical support, you need four nurses and two to three RTs, you need a receptionist, a scheduler, medical records, you need someone to man the front desk. Now, about the pitfalls. There's two major pitfalls when it comes to an ASC. One is, you didn't pick the right strategic partner, you didn't pick the right person to build it, you didn't pick the right person to run it, you didn't pick the right person for advice or consulting and there, I'm just listing two and they're on my disclosures, I'm partners with both of these groups but CVA USA is private equity which we'll hear about in a minute, I think. That is a way that they will provide the equity to build the center and you could be part of that or you could have a group that takes a percentage of what you, the total off the top and they will also be your partner and also, I'm involved in that on my ASC. So, one of the pitfalls is not hiring professionals to guide you through this process. It'll make it a lot longer and a lot more painful and then, you'll buy the wrong building like me and then, there's proceduralists. You need to pick good physician partners. You also need to be smart about who you let do procedures in the ASC. If you have a partner that it takes him three hours to put in a pacemaker, he should not be allowed in your ASC and so, if you have a partner that has a pneumothorax every week, they should not be allowed in your ASC. Two to three partners is probably too little. Six to eight is probably what's needed to be profitable in about two to three years and when I talk about profitable, I mean EBITDA. So, you can talk to your accountant about what that means but it's your earning, your insurance, your taxes, your depreciation and your amortization schedule. Then, there needs to be a medical director. The medical director should get a stipend. They should get paid. The medical director is responsible for overseeing the center. They're responsible for answering questions and they're responsible to make sure that things go on safely in the center and when I was the medical director, I had to decide on privileges and privileges of anesthesia and so forth and it's important to take this role and responsibility very seriously. Now, something a lot of people don't think about but if you get in bed with a strategic, they may give you a non-compete. So, if you have a center in Fort Lauderdale and you have an office in Plantation, they may tell you, I'm sorry, but that's in the catchment area. You're not able to open a center on your own now that you know the business across town. So, be careful about that. The verbiage is in your documentation but you should also have a right of first refusal, meaning if they wanna build a center across town, they should ask you as well. There are lots of resources for this. I'd name one is ASCA. There was actually a recent article that me and Mark Toth were in in the ASC Focus. If you look that up, there's some podcasts on this. If you have any questions, take a picture of this. It's my cell phone and my email and I finish with eight seconds to spare. All right. Thank you. We're gonna move on to the debate section of our session. Arianna, Dr. Arash is going, from Mercy General Hospital is gonna discuss ASCs are ready for the full gamut of EP procedures. Good afternoon and thank you for the opportunity to be here. Just gonna end the slideshow here and go back here. There we go. So, while this is loading up, I'm going to talk to you about, ASCs are, as you heard, are ready for the full gamut of EP procedures, namely, specifically, catheter ablation. Now, there are many inherent potential advantages and benefits to performing cardiac electrophysiology procedures, including catheter ablations and ASCs, which pertain to things like, which all pertain to patients and physicians and also to the healthcare system, including things like improving patient access, reducing costs. But for the purpose of this particular presentation today, I'm not going to get into all this detail. Instead, we're going to focus on the following. Whether cardiac electrophysiology procedures, specifically catheter ablation, in fact, does it qualify as an outpatient procedure that can be performed in an ASC? And the reason why I'm sticking to catheter ablation is because device implantation is already approved for being done in ASCs, and it's been that way since 2011. So we're, in fact, halfway there. What about, so in order to understand whether catheter ablations can or do qualify for being done in ASCs, I think it's important to understand what are the criteria that are put forth by the ASC accrediting bodies, such as Triple HC, that require for a procedure to be done in an ASC environment. They include things like the procedure being an outpatient procedure, of course, which can be performed in only a few hours, which applies, obviously, to catheter ablation. So box checked. Number two, patients need to be absorbed only for a short period of time, a few hours afterwards. And then discharge to home, also box checked with catheter ablation. And lastly, the procedures need to be generally the kind of things that do not require inpatient services or an overnight hospital observation or hospital stay. Again, box checked. And I'm going to spend the next few slides to convince you that, in fact, this is the case with catheter ablation. So what do the criteria demand of ASCs? ASCs really need to provide a safe and efficient environment for performing these procedures. So let's start with discharging patients home the same day. I'm sure you all agree that for the last several years, probably a decade or more, we've been sending patients home after simple catheter ablation procedures and also device implantations. Simple catheter ablation, I mean SVTs, flutters, PVC, AV node, et cetera. What we have also extended that practice to is catheter ablation of AFib. In fact, to date, more than 200,000 patients have been studied in the context of various clinical trials and studies for this. And we all know the study results. In fact, many of us, I think, have evolved to practice in this manner where we're sending patients home after catheter ablation of AFib daily because of its safety. Speaking of safety, what are the safety outcomes of catheter ablation and catheter ablation of AFib? Well, it's drastically improved. If you look at the outcomes as they were reported in 2010 by Dave Wilbur and colleagues, it was pretty quite different than what it is today. Complication rates were as high as 5%, almost. They're now nearly one-tenth what they used to be. And this is really more of a contemporary experience here. We're talking about 0.6 to 0.7%, which interestingly, it's actually lower than many other procedures that are currently performed in ASCs. In fact, as much as sometimes one-third to one-fourth those. If we look at elective PCI, which is currently approved in ASCs, as well as other types of surgeries, orthopedic surgeries and otherwise, complications can actually be higher. A common question that comes up, can we do these procedures without having cardiac CT surgery on site? Obviously, I think we can all agree that this is really not something that's needed for simple ablations like SVT, FLUT or PVC or AV node ablation. I think there's very little rationale for having CT surgery on site. This really pertains to left-sided ablations and primarily, really, AFib ablation. But I will convince you that, in fact, pericardiocentesis is really pretty much adequate in itself, being able to stabilize a lot of these patients and really foregoing the need for CT surgery. In fact, the need for cardiothoracic surgery in salvaging these patients or as a definitive treatment option is really increasingly rare and rarer. Let's look at the outcomes of cardiac perforation. When we look at the outcomes between 2007 and 2017, over that 10-year span, it really has dropped in the setting of catheter ablation of AFib from 1.7 down to 0.6%, about half a percent or so. If you look at the need for cardiac surgery, if we look at the outcomes of the DOAC study, the Japanese study, the European study, the worldwide study, any of these studies, if you look at the outcomes of how many patients required actually cardiac surgery for treating this outcome of cardiac perforation, it's really only about 0.1%. If you look at these individually, it's like 0.06, 0.15, 0.13 in the European study and the worldwide study was 0.14, so around 0.1%. Let's take a slightly more contemporary outcome from the experience reported by Friedman and colleagues that looked at the Medicare database. What they found again was that cardiac perforation rate was about 0.6%, CT surgery rate was 0.1%. Interestingly, 14% of the hospitals did not have on-site CT surgery, but perhaps more importantly, the difference in outcomes between complications between hospitals that did and hospitals that didn't have cardiac surgery was nil, so the outcomes were no different whether you had cardiac surgery on-site. In fact, this has led to practice guideline changes that now advocate for performing catheter ablation of AFib at hospitals that do not have on-site cardiac surgery. So I would ask you, if it's good enough to be done at hospitals that don't have cardiac surgery, why wouldn't it be good enough to be done in ASCs? In fact, if we look at the outcomes results of this recent survey done by HRS, only 60% of US-based cardiac electrophysiologists performing catheter ablation were performing these at sites that did have on-site CT surgery, only 60%, which is pretty impressive. So you might say, okay, that's all fine and dandy, but where's the data, where's the evidence to support that this is actually appropriate? We even have that. If we look at this recent publication by our group, it was a multi-center study of outcomes performed in ASCs across the US. We reported on over 4,000 cases that were performed in ASCs, of which about 36% were device implants, 19% were TE cardioversion, some EP studies, and the vast majority were catheter ablations, 44%. Nearly 1,800 cases were catheter ablations, of which a quarter were non-AFib ablations and three quarters, 75%, were for AFib. Of the non-AFib ablations, the vast majority were for SVT and flutter, and the rest were for AV noda and PVC and ventricular arrhythmia ablation. Of the SVT and flutter, the vast majority, about half or so, were typical flutter, and a quarter were atypical flutter, the rest were SVTs. Of the AFib ablation, about a quarter were ablated with cryo, and three quarters, about 74%, were ablated with RF. Now what was noted was that the folks who underwent these procedures were discharged to home within two hours of device implantation and about four hours of catheter ablation. The outcomes were then compared to similar types of procedures performed in hospital outpatient departments, about 5,000-plus cases done in hospital outpatient departments, and what it showed was that there was, in fact, an increase in cost of about 36%, cost increase, that is, in these procedures of performing hospital outpatient departments versus ASCs. Now the safety of the procedures were also quite good. None of the patients that underwent a TE or cardioversion or EP study at an ASC suffered a complication. Complications were only observed in those who underwent a CID or device implant and those who underwent a catheter ablation. So the take-home message is that the catheter ablation safety was comparable to that of device implantation, actually. And you can see that they were both comparable and reasonably low in the less than 1% range. And also equally important is to note that these complication rates were the same whether done in ASCs, shown in green bars, versus hospital outpatient departments, shown in blue bars. Also it's important to note that these complication rates were in line with what's been reported recently in literature and, in general, at least comparable, if not lower, than elective PCI, which is generally our competitor, our comparator, sorry, that's done currently in ASCs, elective PCI, that is. The rate of urgent or unplanned hospital transfer or admission was also low and lower or comparable to elective PCI as well, less than 1%, half a percent or so. And all-cause 30-day hospital readmission was also equally low, in fact, lower than what's been reported previously and also with elective PCI in ASCs as well. In fact, if you look, some of the lowest readmission rates at 30 days were non-AFib ablation. In fact, these are among some of the lowest you can find in any ASCs of any types of procedures that are currently done in ASCs. So in conclusion, evidence does support, in fact, the safety and feasibility of performing various EP procedures in ASCs without on-site cardiac surgery. This includes catheter ablation for both right- and left-sided cardiac arrhythmias, including AFib, atrial flutter, SVT, AV node, and also ventricular arrhythmias. There were also no discernible differences. There were no differences in adverse events when we compared catheter ablation to device implantation. And keep in mind, again, device implantation is already approved in ASCs. That's our sort of comparator benchmark, if you would, or metric to compare to. And if you look at EP procedures that were done in ASCs in that study that we reported on, they were also associated with low adverse events that were quite comparable to what's done in hospital outpatient departments. But it's important to note that those that were done in ASCs were associated with excellent efficiency and, in fact, lower cost to the system. Thank you. All right. Next up, we have Rakesh Gopinathaner from the Kansas City Heart Rhythm Institute, who will discuss why ASCs are not ready for EP procedures. Good afternoon. So Dr. Ariana actually took a really circuitous route to argue his point, so let's see. So I'm going to say that ASCs are not ready for the full gamut of EP procedures, so why is that? So my disclosures. So typically ambulatory surgical centers have taken care of lower risk outpatients aimed at discharge like Dr. Ariana discussed, whereas hospital labs are full service, ICU access, cardiac surgery backup. So what's the ASC readiness for complex EP procedures? Do we have enough data? Let's look at data. So current EP procedures include pacemakers, ICDs, ILRs, simple SVT ablations, complex ablations are rare, there is actually no Medicare reimbursement for AF ablation right now. So this is a paper that Chris Liu published on a survey, and if you look at the yellow bars denote the procedures that are done in ASCs. As you can see on the right-hand side, when the complexity goes up, AF ablation, PVC, VT, all sorts of things, the percentage of these procedures performed in the ASCs are much lower, and rightfully so. And these red bars actually are people who reported that they could perhaps be done in ASCs, but I think that's a little bit far-fetched, which I'll show. So complex EP procedures, we have all been there, right? We have risks, AF ablation, VT ablation, LAA closure, we are managing more and more sicker patients. The tamponades, the strokes, the air embolism, stuff happens regardless of how good you are. And sometimes they need immediate intervention, and no one is immune to it, and if you are like five miles from the next hospital with a trauma surgeon or a cardiac surgeon, that could be problematic. And so transfer delays can be catastrophic unless attached to a hospital. Transfer agreements, which ASCs are required to have, does not mean immediate care. So Dr. Ariana talked about their publication, and so we've looked at this. But again, if you think about it, I did a PubMed search, and so I searched ambulatory surgical center, electrophysiology, and ablation, all terms. There are 96 results. Out of this, this is the only publication that talks about any safety concerns in an ASC. There's nothing else, zero. And so, and this is retrospective data, one study, six centers, primarily generated during the COVID era, and we cannot generalize on a few operators' experience. There are no large prospective studies, no registries, so typically it doesn't meet the burden of evidence or data quality. We won't even get a 2B indication for this in the guideline, with one retrospective study. So the other thing is, I would also argue that financial incentives are driving the ASC expansion. There is ownership incentives. So in this particular paper, there are disclosures, like multiple operators are ownership in that, so there is some conflict of interest. And then patient safety must come first, is my argument. What about cost, reimbursement, and reporting? Less reimbursement overall. I agree that there is less out-of-pocket patient costs. However, financial viability remains the primary driver for ASCs, and they are forced to cut operational costs, sometimes to a bare minimum. If there is a standalone ASC, you need to negotiate your insurance payments and supplies, so you have less leverage sometimes in that. And the reimbursement versus cost delta typically dictates the type of procedures being done in ASCs. And they don't often have a broad spectrum of tools or technology or resources for the complex patient. And there is typically not, as far as I know, there's no specific requirement for quality safety reporting in these cases. So Dr. Ayanna talked about PCIs. So there is actually a SCI guideline on what to do with PCIs, elective PCIs are reimbursed in ASCs. So they only recommend low-risk PCIs and elective PCIs in ASCs. Complex PCIs are not allowed to be in ASCs, and they only say hospital-based. And so I think EP must be equally cautious with patient selection and pushing. So there is actually, SCI has a great criteria on which patients should not be done in ASCs and for PCIs. So we don't have any of those criteria. And you can say, you know, other concern about the larger EP field is that whether we pushing complex ablation codes for ASCs can potentially trigger a reeval, and perhaps devaluation of existing AF ablation codes, and perhaps hurt the field in general. So in conclusion, there is no debate, we all agree that ASCs are suitable for low-risk procedures. They're not ready for complex ablation procedures till we have robust guardrails, reproducible quality and safety data that meets the burden of evidence. So patient safety is number one priority, not the dollar. So let's remember and first, do no harm. Thank you. Next, we have Dr. Arellano with his rebuttal. All right, here I come, and I'm going to set the record straight on some things. So I will start by saying that I don't know how it is at your hospital, but sometimes it takes about half a day for me to be able to get something to the cardiac surgical suite the way our surgeons operate. So having an ASC next door to a hospital five miles away is probably no different than being where I work out of, and I think that's indicative of most places. But more importantly, I'm going to start by saying the following. It's been widely argued that any procedure that can be performed outpatient without requiring inpatient services can ultimately and should likely also be done in ASCs eventually. This applies to device implantation we already heard since 2011 has been approved to be done in ASCs, and we have a lot of data on that. By the way, we had no data when it got approved to begin with, correct? So it was basically based on the data we had from outpatient setting. Coronary angiography has been approved since 2019 by CMS to be done in ASCs. Despite what my good friend said here, Rakesh, elective PCI coronary stenting and atherectomy have been approved since 2020 by CMS to be done in ASCs. In addition to that, a vast majority of complex vascular procedures have been approved in ASCs to be done since 2008. These include atherectomy, carotid renal mesenteric revascularization, CTOs, complex limb salvage. There is currently a pilot study looking at EVAR being done in ASCs. What's missing from all this? Catheter ablation. We, in fact, just showed catheter ablation outcomes are quite good. They've gone down from point, whatever it was, 4.9% down to 0.6% complication rate. I already showed these slides before. So I know that we all like to see evidence-based practice, you know, to hang our hat on and to do things that way, but we already showed that. We showed, in fact, more than 4,000 cases have been studied with very good results. However, I'm not sure if Rakesh did a thorough search in his lead search, but in fact, there are five publications which are cited right here to date that have looked at the safety and the outcomes of procedures. All these are AFib ablation, in fact, for the most part, mostly catheter ablation, but mostly AFib in the context, in the setting of ASCs. So we just presented really the one most recent paper that I published, but really there are five altogether shown here, totaling almost 5,000 cases, all of which have shown outcomes about 0.5% to 1% in safety. So let's quickly compare this with a comparator that we know best, elective PCI. Both have a 0.5% to 1% cardiac perforation rate. However, when complications happen with elective PCI, mortality is actually quite high, 0.6%. Mortality associated with AFib ablation is far lower, less than one-tenth that, 0.02 to 0.06%. Both can be done without CT surgery on site. How many PCIs were done in this country before CMS approved this for this practice? Zero. How many catheter ablations have been done thus far in ASCs? Almost 5,000 cases. I would submit to you that, in fact, there is no debate here. What is missing is CMS approval. Thank you. So if one retrospective study is the bar for evidence, then we can all rest our cases. And so improved technology doesn't mean that no emergencies. Maybe Dr. Ariana never had complications, but then as a wise surgeon once said, there are only two types of surgeons who don't have complications. Either they are dead or they are not operating. So stuff happens, right? And so transfer agreements solve the problem. That's another kind of common refrain, but stuff happens, right? And so transfer delays worsen outcomes. I would stop by showing, ask the audience a question. So you're a 72-year-old mother with symptomatic persistent AFib needs and AFib ablation. She asks you whether she should get the procedure done in a standalone AST close to her house, and the closest hospital with cardiac surgery is about three miles away, or in the major hospital in town where there is cardiac surgery availability 24-7. Where would you send your mother? Do you like your mother? There you go. That's my answer. I rest my case. Thank you. Wonderful debate. I don't know if we need a show of hands to say who won, but anyway. We're going to shift up a little bit. Our next talker is Dr. Shaikh, and he's going to discuss the influence of private equity on the EP practice. Is it here to stay? Full disclosure, I've been an EP in practice for 15 years in Orlando. I've been with private equity for two years, and whether it's Dave, Arash, or Rakesh, they all need money to do this stuff. The debate ends right there. It's easy to give an EP talk. Three years ago, I was Googling what is EBITDA. Honestly, I had no idea what EBITDA was. I was asked to give a talk on the influence of PE. So where do you get the funds? Where do you get the money to do what you have to do? And how do you do this? So about four years ago, this was a topic which I had no idea about. You could ask me about ablation, you could ask me about concessive statements on any of these guidelines that are needed, easy. So what is private equity, right? And why are we here? Is this, so just researching this, and these are not my opinions, these are from papers that have been actually out there that I put through. So is private equity just about the money? Or is the move of private equity to a symptom of the more foundational problems that we have had over the last several years with the current practice of medicine, hence the debate here, right? It's ASC, OBL, are you employed by the hospital, are you not employed by the hospital? I mean, this is, right now, it's coming to a crux for all of us. So what is private equity, and why did we get here? How are we here at this point in time, right? So cardiology practice is 20 years ago, practices of 10, 15 cardiologists, you know, they did a stent, or they did, you know, $20,000 later, you know, you look at them, you were in the golden era, we say that, right, you were in the golden era. What happened then? Well, the cost of these procedures started coming down, they all got borrowed by the hospitals, reimbursements started coming out, there was a question of site service, right? And then a few years ago, affordable act care, well, value will be paid, right? Well, who determines that value, right? So what happened, and then COVID came along, right? When COVID came along, suddenly it's like, you know, everything had a value to it, we had to do everything more efficient, faster, quicker, cheaper with limited resources, and the hospital started extracting, well, you know, Dr. Sheik, you can do an ablation quicker, or faster, or slower, whatever you mean, but they were taking the resources away from it, and into this sort of walked in, this worsening sort of, this perfect storm walked in private equity about three years ago. Now, private equity is nothing new, it's been around for quite some time. If you step back, just look at your, go to your, look at your homes, where you live, you know, the transportation, private equity is involved in every aspect of your life, okay, every aspect of your life in one way or the other. So what is private equity, right? It's an investment management company that uses funds or capital from investors, people who have more money, simple definition there, to acquire and manage companies with the goal of improving, making money off them and selling at a profit, it's simple. It's not that complicated, this is the Wall Street Journal definition of what is a private equity. But what's the difference, right? So, you know, my friends ask me, what's venture capital, what's hedge fund, what's public fund, I was like, okay, let's just look it up, kind of knew about it, but never looked into it, so what's the difference here? And this is important to understand this, and venture capital is basically invest in early startup, you have an idea, they put the sources in, they grow it, high growth companies, right? Well, private equity tends to buy companies that are usually well established, and then they sort of grow you and sell you on that. Hedge funds, well, you've heard about hedge funds, and they're billionaires and trillionaires in these hedge funds, right? And what do they do? They have a short chain arbitrage that's going around selling. Private equities don't do that, they acquire, improve and sell. What's public stock? Well, this is very important to understand. Public stock does, companies that are only publicly traded, I mean, you can see all the information. Private equity is not required to do that. Private equity usually gets companies that are not publicly listed. So, there's a little hoodwink here as well, generally across the board, not necessarily medicine, these are general concepts of business that you kind of get to hear when you look at these things. So, what is private equity, right? It invests in companies that are not publicly traded, and there's a reason for that. They don't want that information out in the norm to everybody to see, okay? It's just a business move. Capital, where does the money come from? It could be from investors from anywhere in the world. Just go back and look at your hospital, or wherever you work for, you'd be surprised at how many people, sovereign funds are involved in owning certain shares of your company, 100% of your hospital as well. So, there are 461 hospitals in the United States that are backed by private equity, okay? Very hard to find out who's who, but when you look at it, 20%, 30% is from money all over the world, just business moves. So, it's very important to understand that value. So, what does private equity do? They create value, improve performance, invest in operational improvements, cost reduction, strategy changes. Essentially, they're packing you up for a nice exit sale at the end, and your price goes from EBITDA times, like you mentioned, times two, three, four, five, and you exit, and you make money. So, what's so bad about that, or good about it? Well, this has been around for quite some time, right? I mean, if you look at this graph here, dermatology, ophthalmology, primary care, and you can see cardiology is right to the very end, right? Cardiology just came into the foreplay about two to three years ago. There's not enough data that's reported, okay? Public knowledge, the most recent private equity closure was about $5.2 billion for an ophthalmology company about three months ago, okay? So, you're talking about how you can sort of snowball this into times X from your initial value. So, this exists already in the United States, and all, you know, radiology, and you probably heard about a lot, even oncology, by the way. You know, oncology, outpatient oncology, is private equity is investing in them because there's a huge profit to be made there. Yes, it is about the dollars, unfortunately, okay? Now, why is there interest in cardiology in EP? I couldn't find specifically in EP, so it has to be cardiology. There's an aging population, right, for sure. We are seeing more and more of cardiovascular disease across the board, and then the shift. You saw Arash make the case for outpatient. Well, yeah, I mean, there are days where we cannot fit them in our hospital. There are days we have three, four, four efficiency issues. There are a lot of things related like that, right? So, and there's a shift of these procedures to the outpatient center, transition to OBLs, ASCs, and this transition has been largely responsible for the attraction for private equity as well. I mean, they're looking at us as a business. I mean, the clinical science, yes, the guidelines, yes, what we do, all the good and bad you heard in the previous debate, yes, but at the end of the day, you're packaged like a stock, okay, so, and procedure migration. This is the key. Procedures will migrate. This is something way beyond our control. It's gonna happen, okay? So, if you look at this one graph that I could find, you can see the interest in acquiring and practice allocations. It's gone up substantially since 2019 to 2023, and 2024, the data is even more, okay? So, gradually, as people are understanding this, it is actually the acquisition of practices by private equities of this type is increasing, and this is reported by JAMA, so this is an author who has actually done quite a bit work and reported it very well. So, again, now, if you look at this map, what's interesting here is Florida, Texas, Arizona, a few others, but most of these states are Republican states, right? So, there's a political bias to this as well where the laws are lax, they encourage private equity, and you can see by the distribution, there are a lot of states where the certificate of need is actually being challenged. You know, they're taking care to the outer areas where care is not available, so they're making cases how to expand in areas where there are no hospitals or no care available. So, you can see here, these are the lists of some of the top 10 private equity groups that are in play among the top 10, and you know who's the biggest investor in private equity in the United States? BlackRock, right? Webster. So, these are people with multi-trillion dollar hedge funds across the world, and this is coming, for sure, right? And again, the distribution, you can see the bump in the private practices or across the world. By the way, private equity can acquire you as a private practice. Private equity can acquire you from your hospital. Private equity can acquire you as a department in your division. They can acquire you as a cardiothoracic. Wouldn't surprise me in the next few years if the hospitals decide to bundle up your entire cardiac, cardiothoracic, vascular division and say, all right, here we go. You're a stock for us right now. You know what, you still continue. Will they share the profits with you? We don't know that, right? It's gonna happen. I bet with you it's coming in the next five years, okay? But a lot of things determine that. So, cost reduction, innovation, improved access. So, good things. But what are the bad things, right? This negative impact on care. But this data is largely driven from non-cardiac data so far. So, to Rakesh's point, in the next two to three years or five years, we'll see data if they report it. There are studies that say, hey, if you're with private equity, the cost can be higher. Reduce quality of care. You already heard about that. It's possible because they may cut costs to do this. Transparency, they're not required to report. So, several states are requiring you to have reports in place. But we'll see how that plays out because it depends upon your local state and also the sort of the national network if you are required to report all the goods and the bads that are done from an operational standpoint. We're not talking about clinical standpoint. Now, what are the problems here, right? I mean, you could be on increased regulatory scrutiny. During the last administration, there were people who were anti-trust laws. They were looking at it very carefully. That just went away by January of this year when the new administration came in. So, there's a shift politically where the investigations are needed into this. State policies, like I said, depending on which state you are in, people can change the rules and regulations. Market conditions, well, we are going through that right now. Now is not a good time for private equity or anybody, right? If you guys went back and just looked at your stocks or your retirement funds, the rates are down. They want rate cuts. Rate's not gonna happen. This is actually will play a big role into how a private equity that invests in the end of the day for them, they want more money for less interest and states stable. And the economic conditions will drive that. So, having said that, this is an evolving field. I think the data from cardiology or electrophysiology or interventional cardiology over the next three to four years, this will become more transparent. I think it's, will it stay? I think it will stay. It just depends on the growth. We have seen rapid growth over this in different parts. And it wouldn't surprise me that groups or hospitals across the country start teaming up. And this might be something that we will have to study more in detail. So, thank you very much. So, we have about 15 to 20 minutes for Q&A, but I'm gonna ask one question. And we're joined here by Gopi Dandamudi and Melissa Robinson. Most EPs in the United States are hospital employed. How do you even approach the topic of starting an ASC for a hospital system to facilitate out migration of cases and for them to lose money when all of us have very restrictive contracts in regards to those kind of endeavors, without short of just going private practice? Sure, maybe I can take that. I think one of the things that becomes incredibly important in these kinds of business deals is understanding your market conditions. This does not, this same model does not apply all across the country. You have to know your market first and foremost. Good example. Currently I'm in South Carolina. The state recently in the last year passed a seal on law. So, we don't have any more certificate of need. That means anybody can open up an ASC anywhere and build a hospital. So, what do you think is happening in the competition? Right across from North Carolina, the systems are coming into the high paying areas with good payer mix and starting to buy land to open up ASCs. So, what do you think our system is doing right now? They're in the talks with all of us to start saying we wanna develop ASCs now, we want you to start partnering. So, there's gonna be a lot of climate that changes very rapidly in the next five years. That's gonna force systems to partner with physicians. It's also important to understand who you're partnering with. It's easy for people to say private equity, let me go on my own and do all that. It's incredibly important to understand who controls the patient population in your community. It's easy for people to say, oh, I have an ASC. You have to run an ASC. That means your ASC has to be running five days a week in perpetuity if that's how you're looking at it because you're not doing this for two to three years. You're looking at it in perpetuity. You don't know what the market's gonna look like in five years, seven years, 10 years, what your business is gonna look like, where your patients are coming from. What looks today as your norm is gonna look completely different in healthcare in the next one, two, three years, five years or so on. So, I think you have to take all those factors into consideration. It's not just getting somebody to fund it for you, finding some bodies and starting an ASC. What is your entrance strategy? What is your staying power? What's your staying strategy and what's your exit strategy? I think it's crazy for anybody to go into any business if you ask me without understanding what a good exit strategy is for every individual. I think it's criminal if you do it to yourself without understanding what if it doesn't work? What is my exit strategy? What if I wanna retire? What if I wanna move somewhere else? I don't wanna be married to this ASC because it's not being run well or so on and so forth. So, I think there's so much more to this than just simply looking at can I do cases in ASC? Can I partner with somebody and will I make money? I think we're simplifying this way too much without understanding the complexities of running a business. And I'll be the first one to tell you as a physician myself, I'm horrible at business. It took me a long time, 10 years of moving from job to job, doing administrative work to understand healthcare and I still don't understand healthcare. I'm still not good at business, understanding business and all that. Actually, what I've learned mostly in business lately is through chat GPT. Chat GPT has taught me tons of stuff about ASCs to this and so on and so forth. So, I think we have to be very careful what we're getting into. I don't think it's a bad idea. I think it's a good idea if you know what you're getting into. I just wanna add something, Gopi. You know, one of the things to understand is, just to give you an example, in Florida, I'm chief of the system for Advent Health Electrophysiology, okay? The hospital already has ASCs existing and they're a physician. So, in your system, you know, you gotta be close to your administrators. You gotta talk to them in addition to the clinical work that you're doing, to all the points that Gopi pointed out because they are gonna open and when they open, you know, the question becomes, are you just gonna go work there or are you gonna build some equity in it as well at the same time? So, what's in it for you? Why would you just decide to go as a hospital employee DP to the hospital's ASC, which has all the criterias that Rockation has for safety and everything and do a case there for what? Just to get your same RVU or the same professional fee for what? So this is why you need to get engaged early on because this is coming. At least in Central Florida and South Florida, we're seeing ACs attached to the hospital there and they're asking their electrophysiologists, their interventional cardiologists to do procedures. So this is a huge changer, it's going to change, it's coming, so be on top of it. Scott, can I ask a question? Can one of you guys talk about the impact of site neutrality and how that's going to impact things going forward? Just before you respond, I just want to remind you that there's a microphone over here. We've got about 10 minutes left of questions. So approach the microphone, introduce yourself and ask your question after this question is done. Site neutrality has not been fully defined. There are possible ways to figure out site neutrality. One of the potential reimbursement formulas for site neutrality is if you have the same procedure performed in an outpatient hospital setting, in an ASC and an OBL, CMS will figure out where the most of those procedures were done and then they will reimburse everyone that same rate, which could be an uptick or a downtick. One of the other formulas include ASCs not being touched and potentially being the highest reimbursement to start and the other, OBL and outpatient hospital, being less than the ASC and with the goal that reimbursement is pushing towards ASCs because they believe that we can provide care there in a more cost effective manner than hospitals. For instance, a hospital has to worry about all kinds of loss leaders when they think about their budget, whereas a cardiac ASC is a big money winner. So there's more to come with site neutrality and it's not totally defined yet. The other thing I will mention is that yearly, Medicare will look back and see if next year the ASC was number one, then that will be the payment that they will decide. So it becomes a problem for future budgeting. Scott, can I quickly answer your question as well? I want to make sure we give enough time to folks to ask. You had asked about what would happen to physician employees as I am too, by the way, one, as you are too, right? Oh, actually you're not, I am, but anyway. So I was going to point out that I think we can learn from the experience from ophthalmology, from GI, from orthopedic surgery. The moment ASCs became a reality in those kinds of specialties, it was a supply-demand issue, right? The market, as you said, as you were saying, demands it. So basically, all of a sudden, hospital entities had to come to the table to attract physician, employed physicians or whatever relationship they have with them to either be a part or be included in the conversation, be a part of the ASC discussion, or else they would risk the possibility of out-migration. This happened pretty bitterly in some of the healthcare systems, like Living Mine, as you're pretty well aware of this, Scott, with regards to orthopedic surgery. I think many healthcare systems have learned their lessons as to how to handle this. So I think this is generally something that could be very favorable no matter what model of practice that you're in, whether you're truly private practice, whether you're a hospital employee, whether you're whatever you are. In fact, there are talks about academic physicians, as you may be aware, to be part of these types of ownership models. Our good friend, I don't know if he's here, Rod Tung is obviously the best model for that. I'm aware of three other hospital academic environments and institutions, solid historic academic programs that are, in fact, taking physicians to become partners in these types of ventures. Anyway, just wanted to kind of answer that briefly. One more comment from David, and then we'll move on to questions. Yeah, I wanted to answer Rakesh's question. I've actually owned my ASC, as I said, and it's been up and running, and I've been doing device implants there since 2019. And I have taken family members there. And I do think that the level of care in my ASC is better than any of the local hospitals. And I do think that I can get a patient to the OR faster from my ASC than I can from inside the hospital. I have an awning in the back of my ASC that I literally could push the patient in a gurney to the hospital, which is about a block and a half away. So there's tremendous fear of the unknown, and I really recognize that. And I think before you take any kind of leap, you're gonna have all kinds of fear. But is that fear baseless, or is that fear real? And I wanna tell you that when ablations come to the ASC, which is gonna come next year, you're gonna see, as we track outcomes, that it's gonna be better than in the hospital. This wasn't my company, but I did the second and the third thing in the OR, and I've been operating my ASC implant since 2007. I think CMS originally released their decision in the fall of 2006. Bruce Lindsey was then the incoming president of HRS, and their final ruling was in 2007. And I totally agree, our complication rate, obviously, patient selection and proficiency of operators is a huge issue, but I would much prefer my patient to get done in our ASC than in the hospital. Our infection rate's 17 years running, or a third of the hospital, and that's at three different hospital systems as a medical director seeing that data. That's really not what I was gonna comment on, but thanks for that comment. I would encourage all of my colleagues here as EPs, you can learn administrator language and business language much faster, as challenging as it is, an experience as a brutal but effective teacher, much faster than administrators can learn your language as a physician. So I would encourage you to do that, because whatever you're negotiating, inside a hospital system or outside of it, your ability to speak their language makes you credible in ways that you can't imagine. So I would encourage all the physicians here to, and if you don't wanna do that, fine, find a colleague who does, because you probably know one, who is willing to do that and gain the experience these guys have gained, because just because EPs are at the same financial compensation rate in 2019 and 2025, in real world dollars deflated, you've lost a third of your income. And we've gotta find a way, because the hospital's interest financially are no more noble than yours. Please, spare me. 501c3 aside, mission of religious organizations aside, no mission, or no money, no mission. Not only for the hospital, but for us as physicians. Those are my comments, thanks. Thank you. Steve, I'm just gonna comment to what you said really quickly. When we presented some of these codes to CMS and we're trying to push for approval, in fact, there were nurses who had worked in various random AACs, that came to the website where you can actually leave comments for CMS, in fact, saying what you said, that in fact, they'd feel a lot safer doing these procedures in those types of environments that are fully dedicated to one type of procedure, as opposed to managing a mitra clip, a TAVR, an A-fibrillation here, and something else over there. Probably the best example of that is Vijay Sourav, probably should be up here, who's had a long standing history of, like you, doing this stuff, and in fact, his AAC builder chose to go to his AAC to have his A-fibrillation done in the hospital. So, I mean, you see that a bit often. We've had board directors of hospitals and competing organizations come to our AAC, so that's sort of telling, too. Hi. Eric Rashba from Stony Brook on Long Island. Had a comment about private equity. I mean, the argument was made that their goal is to create value and then exit once you have a higher value enterprise, but I mean, I would, there's many examples when private equity actually just extracting value and exiting afterwards, like the whole debacle with Steward Healthcare, with nursing homes, where basically they just extract the value from the real estate, and the original enterprise goes bankrupt, so I'm just wondering if anyone here has any personal experience yet about working for private equity in cardiology and EP, because I wonder what that really would be like given the way the behavior is. So, Shah already spoke, so I've been involved with CVA USA since July of last year. It's in my disclosures, okay? So, and my experience is their goal is to increase value. Obviously, there will be an exit strategy one day, but at this point, they've added ancillary services and other services to my practice that I wouldn't even dream of, like owning a PET scanner, like having cardiac rehab at home, like RPM monitoring and remote monitoring in a centralized center, the list goes on. So, I think they provide you with ideas on how to grow value to your cardiology practice, which if you're not employed by a hospital system, then you are a business, and if you're a business, you need to figure out ways to increase value. Yeah, there's a nice article out there. If you Google it, private equity, is it a marriage in hell? I'm happy to share that with you, but I think it's who you go in bed with, like Gopi pointed out, and extrapolating data from just like the instance that you pointed out for cardiology is gonna be very different. It depends upon what organization you're with, the size of your organization, and a lot of the reporting requirements are coming into play now. They're deliberately implementing it so that when you have an exit strategy or you don't have an exit strategy, you have data to show what's going on to answer the very questions that Rakesh and Arash have said so there are new things in play, so I think two or three years from now, the data will tell. David and Arash, great presentations, thank you. Just can you comment on surrogate or need? There are seven states in the United States that actually require surrogate and need. Can you comment on that and maybe how we can move as a society to actually change those rules? Yeah, thank you for that, Marcin. I probably should let some of the other folks who are better experts on this to answer, but I would say, I think there are 34, I wanna say, states that have surrogate and need. There are about, I think, 16 don't, or maybe there about. I think New York, which is where you are, I know, Marcin, is one of the worst states, last time I checked, unfortunately. But I think really what we need to do is this is what we need lobbying, I think, and this is what we need proper representation to be able to push for those types of things and then challenge them. That's what I would say. I'm curious to know what David and others think. I think all politics is local, and so I think these need to be settled on a state-by-state basis with cardiology advocacy. Actually, there's someone in your state who's very involved with advocacy at an ASC level, which is Dr. Joseph Puma. I would reach out to someone like that and see if you can team up and deal with the CON laws. And it's doable. So I just wanted to add one thing to the private equity conversation. First of all, thank you, everybody. These were great talks and this is such a wonderful debate. So I commented earlier about something, too. I'm Joey Sager. I've been with a private equity platform, the same one that Dr. Kennersburg and Dr. Shaker, and I was the second group to join the platform. So we've been with them since 2022. And what I wanted to say was that the system right now is rigged against us. The reason that 90% of electrophysiologists are either owned by a hospital or academic is because the system as private practice, as physician stakeholders, was not viable for a long time. And what private equity has stepped in to do, obviously there's value and we can talk about them buying up PrEP, but what they have really stepped in to do is to empower us, to scale us as physician stakeholders so that we continue to be competitive as stakeholders instead of having to be employees. The platform that we're on, CVA USA has done a fantastic job of this. I was a skeptic. But we've remained completely autonomous and all they've done is add value in the services that Dr. Kennersburg spoke about. So I would encourage everybody to be very open-minded about this and to think of this as a positive thing for our paradigm and for our culture within EP because I think that the natural competition that comes with a greater voice for a private practice is good for everybody. Okay. Thank you. Anyone else have anything to say? I guess I'll say one thing. So I'm honestly surprised to be on this panel. So I work at Providence in Montana and the ASCs that we have in a smaller rural area are ortho and GI and they've stripped the hospital revenue. So there is, I mean, it's not our job as electrophysiologists to bankroll all of the hospital's revenue, but it is a fact that that is true in many areas. Maybe not in Florida, maybe not in New York. So there is going to be consequences for healthcare at large when we're doing this. Maybe that's a little wet blanket on the end of the conversation. Hopefully there's innovation, hopefully there's this, and hopefully we have a bigger say. I agree, healthcare, there's a lot of value to be extracted, there's a lot of waste, but there are consequences. But I would just respond by saying there's a much better way of running hospitals, much better way of dealing with industry, to be honest with you. The prices that are being offered to us is really astronomical and hospitals, we are not good at negotiating that. So I think this is one of those situations where the system needs to improve and the healthcare system is unable to really take on. And I'm in a system with 52 hospitals and we still can't balance that. Just imagine if a population is supposed to double in five years. How are we going to sustain this? There's not enough labs out there to support this. So we can't just sustain a failing system just so that we're afraid of the inevitable. That'd be my response. All right, well our time is up. Appreciate it, that was a fantastic session, great debate. Thank you.

Electrophysiology

Ambulatory Surgery Centers

Private Equity

Heart Rhythm Society

Scott Greenberg

David Kennesburg

Arash Arellano

Catheter Ablation

Patient Safety

Healthcare Innovation