Evolution of Third-Party Involvement in Orthopaedics

The pace of third-party or private equity (PE) investment in the U.S. orthopaedic surgery sector has been rapid. The specialty has been of extreme interest among PE investors because of its relatively high-margin procedures and increased demand due to a growing elderly patient demographic. Such ownership has far-reaching consequences, not only financially but also in terms of orthopaedic care delivery and education. The current PE business model focuses on financial payback and often stresses short-term profitability at the expense of pillars such as physician autonomy, mentorship, and patient-centered care. This propensity toward consolidation threatens the traditional apprenticeship model. There is also concern about the deterioration of resident education, professional growth, and leadership. This article reviews the role played by PE in shaping the culture of orthopaedic practice, graduate medical education, and the career path of young surgeons. It also discusses the policy and ethical outcomes of the corporate ownership model in orthopaedics. PE ownership of orthopaedic practices will limit professional opportunities among young surgeons. The mentorship model stands to deteriorate and quality care delivery will be set aside in favor of financial gain unless these issues are explicitly addressed. Surgeons, medical societies, patient advocacy groups, and policymakers should promote measures to ensure transparency of third-party ownership and to track referral channels and the cost of care. PE ownership is moving orthopaedics toward a paradigm that jeopardizes education, autonomy, and professionalism. Physician leaders and societies, such as the American Orthopaedic Association; academia; patient advocacy groups; and policymakers should ensure that the mission and core values of the specialty are protected.