The Managed Service Organization model for healthcare
Private equity is consuming small and large private clinics all over the country. By the time more junior healthcare workers are paid, they only make a fraction of what they are billing. This causes them to be overworked but underpaid, as much of the revenue goes to overhead and the private equity owner of the clinic.
A new startup model has emerged as an alternative to PE ownership: the MSO (Managed Service Organizations) model.
The MSO model enables doctors to run their own clinics by (1) providing them software that can handle back office tasks such as billing and scheduling and (2) channeling patients to them.
These functions are largely what PE ownership provides. Doctors who are part of an MSO model can continue to run small, physician-owned practices while competing successfully with large, PE-owned conglomerates.
