“Whereas if we worked directly for the hospital, I don’t think we’d have much say in the matter,” he says.
He also says he is happy with the predictable schedule; he’s responsible for 7 a.m. to 7 p.m. and nothing more.
“If you’re finished rounding and you’ve seen all your patients and tied up all your loose ends, you’re not always there till 7 p.m.,” he points out. “Sometimes you can leave a little early….Once 7 p.m. comes, you’re not going to get paged in the middle of the night.”
Thomas R. Collins is a freelance medical writer based in Florida.
Wall Street’s Rosy View of Hospital Medicine
Listen to Dr. Holman, MD, MHM, discuss Cogent HMG’s new-acquisition strategies.
Adam Singer, MD, chairman and CEO of IPC: The Hospitalist Company (center), rings the NASDAQ closing bell March 28, 2008, in New York City.
When IPC: The Hospitalist Company went public in January 2008, its stock price was $16 a share. In late July of this year, it was hovering a tick below $50 a share.
It’s been an obvious financial success—a performance that speaks well of the hospitalist specialty as a whole, says analyst Kevin Campbell, who covers IPC for Avondale Partners.
“Investors like the industry,” Campbell explains. “They see the need for hospitalists….When investors look at that, they see the opportunity for continued growth.”
IPC’s management team, he adds, has done “an excellent job of growing both the revenues and the earnings.”
Revenues in 2008 were $251 million. This year, they’re projected to be $454 million, an increase of 80%.
Six of 10 analysts say the company is a “strong buy,” one says it’s a “buy,” and for three others, it’s a “hold,” according to research listed on the NASDAQ website.
One of the key reasons IPC has performed well, Campbell says, is that when it makes an acquisition, physicians whose practices are bought are not paid everything at once; a portion is paid out later. Because the payment is a factor of the company’s performance, that encourages the physicians to keep their newly acquired practices performing optimally.
That’s different from scenarios in which “doctors would take their big check and retire,” he says, “and the operations for the practice would decline significantly. This is one way that IPCM [the stock symbol] can ensure that that doesn’t happen.”
Campbell also says it probably is unlikely that there will be another public offering of a hospitalist company in the near future. “There’s not a lot of companies of scale,” he says. “You have to have some scale before you would consider going public.”
R. Jeffrey Taylor, IPC’s president and COO, says another public offering from a hospitalist company isn’t that far-fetched.
“I would not be at all surprised to see someone else follow that path,” he says. “Frankly, it will probably be a little easier for the second company to do it because we have helped educate people about the hospitalist model, and fortunately the company and the stock have performed well. So I think it would be an easier sell to the public market the second time around. And I expect that’s more likely than not in the next few years.” —TC