Trends in Outpatient Services and Care

Vertical: Outpatient Services
Date: April, 2015

Acquisition Environment

The diagnostic imaging industry remains highly fragmented with over 6,000 imaging locations across the United States. sellers are driving acquisition multiples for freestanding centers, with marginal operators being acquired at 3-4x EBITDA. On the other hand, radiology groups tend to trade at a higher range of 6-10x EBITDA. 22 transactions were announced LTM, representing a 33% decrease from the previous period.


Reimbursement climate to benefit from “site neutral” trends. The CMS is moving toward more of a “site-less” or “site neutral” method of payments. We see more room for this gap to be bridged and drive growth.

Legislative and Regulatory

Federal government cost cutting in the form of limiting the Sustainable Growth Rate has reached an end. Thus, the SGR overhang is a tail wind that allows management teams to focus on internal portfolio and / or core strategy. As a result, M&A activity should increase

Acquisition Environment

GHA sees continued investment in outpatient services and care centers with the large strategic acquirers being more active than in the past. Private equity & smaller strategics need to stay competitive.

Strategic Framework

Long-term we favor “two-fold” technology adopters and integrators. Medium/near-term, we prefer those firms who focus on cost & convenience.


GHA sees EBITDA multiples ranging in the “high single digits” to “low teens.” Financial benchmark data suggest outpatient service or care centers EBITDA margins can range from the mid-teens to low twenties on a percentage basis.

Competitive Landscape

Standalone Outpatient Services and Care centers compete directly with Hospitals and Health Systems that offer the same treatments. We have detailed analysis of the major players in this report.


1) Failure to adopt new technologies, 2) increasing costs, 3) competition and 4) change in regulatory or reimbursement environment.

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