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PRG buys its closest competitors
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DALLAS — Physicians Resource Group (PRG) bought EquiMed's vision company and American Ophthalmic Inc. for $124 million in early October to consolidate hundreds of eye care professionals in regional markets across half the continental United States.
A week after that purchase, the company announced it will merge four more unconsolidated groups from Florida, Illinois, Arizona and Ohio into already-purchased practices. In the past 17 months, the physician practice management company (PPMC) has acquired practices involving 580 eye care professionals. While 330 of these professionals are ophthalmologists, a spokesperson from PRG said a breakdown on the number of ODs was not available.
Acquisitions across the country
The EquiMed purchase, a publicly traded PPMC based in Tucker, Ga., cost PRG $54 million and provides it with practices in seven states. EquiMed's eye division, based in Atlanta, provides management services to about 48 doctors in 21 practices.
The purchase of American Ophthalmic, a national, private PPMC based in Winter Park, Fla., cost PRG about $70 million. American Ophthalmic had about $80 million in gross revenues.
The four independent practices — Melbourne Eye Associates in Florida; Green Waltman Institute in Belleville, Ill.; Southwest Eye Associates of Safford, Ariz.; and Levin Eye Institute in Cincinnati — cost PRG $13.8 million.
Wall Street's role
Donald A. Hood, OD, president and CEO of the Eye Health Network in Denver, said PPMC acquisition programs are significant to optometry because "it means there are significant amounts of money from Wall Street pouring into the eye care industry," Hood said. "That's good, but the questions are: who's getting this money and what's being done with it?"
Eye Health Network is owned by another publicly traded PPMC, Omega Health Systems Inc.
At the present time, according to Hood, money from Wall Street is going into ophthalmology and to companies like PRG that are all "clearly ophthalmology controlled." Companies that initially considered buying optometric practices as well as those in ophthalmology appear to have pulled back from that philosophy for a while, he said.
"These companies are surviving and I respect that, but they do not have a culture that's compatible with optometry overall," Hood said. "The money from Wall Street is pouring in to support the optometry slayers in addition to the user-friendly ophthalmologists."
Optometrists concerned about the changing PPMC market should not panic, Hood said, but instead step back and analyze each company's commitment to optometry. "Right now all the pressure is on ophthalmology," Hood said, "as seen by Medicare cuts, reimbursement cuts and an emphasis on primary care. If optometry can do more cost-effective things and become the entry point for care, the picture isn't so bad. Optometry is not doomed."
For Your Information:
- Donald A. Hood, OD, may be contacted at 1550 South Potomac #155, Aurora, CO 80012; (303) 759-9418.
- American Ophthalmic Inc, is located at 250 S. Park Avenue, Ste. 600, Winter Park, FL 32789; (407) 647-5000; fax: (407) 647-5648.
- EquiMed Inc is located at 3754 La Vista Road, Tucker, GA 30084-5637; (404) 320-6211; fax: (404) 320-0023.
- Physicians Resource Group, is located at Three Lincoln Center, 5430 LBJ Highway, Suite 1540, Dallas, TX 75240; (214) 982-8200; (800) 216-2106; fax: (214) 982-8299.