July 2, 2014
Sound Physicians Announces Recapitalization with Fresenius Medical Care
Ascension and Dignity Health join in investment to advance expansion efforts; TowerBrook Capital Partners and management team continue as investors
Tacoma, Wash. – July 2, 2014 – Sound Physicians, an innovative physician services organization with more than 1,000 hospitalists and a proven record of improving quality, satisfaction and financial performance for more than 100 hospitals and post-acute centers, announced a recapitalization with new majority shareholder Fresenius Medical Care and strategic partners Ascension and Dignity Health.
TowerBrook Capital Partners will continue as an investor in the new corporate structure alongside existing management shareholders. The new members of the ownership group bring significant experience in national healthcare services which will further advance Sound Physicians’ continued expansion nationwide for hospitalist and post-acute care services. Sound Physicians’ board of directors selected Fresenius Medical Care as lead investor based on its strong track record of success as a global healthcare services company delivering high quality patient care to thousands of hospitals globally.
Fresenius Medical Care has proven to be a trusted partner to private and public payors alike, delivering significant improvements in quality together with reduction in cost under a variety of innovative bundled and pay-for-performance payment models. These capabilities, combined with Sound Physicians’ patient-centered approach, web-based workflow platform and experienced physician leadership coupled with the endorsement and support of leading health systems Ascension and Dignity, clearly positions Sound Physicians as the partner of choice for breakthrough results throughout the acute episode of care.
Hospitalists are different from many other physicians in that they provide care to patients almost exclusively in an acute or post-acute setting, rather than in an office practice. By coordinating care among hospital staff and patients’ primary care physicians and specialists, Sound Physicians’ hospitalists help improve patients’ length of stay in the hospital and reduce the occurrence of readmissions, leading to better health outcomes and reductions in the total cost of care.
“We are excited to have Fresenius Medical Care, Ascension and Dignity Health as our new investment partners,” noted Rob Bessler, MD, Chief Executive Officer of Sound Physicians. “Fresenius Medical Care brings decades of experience in managing high-risk, chronically-ill patients, improving quality, patient satisfaction and reducing the cost of care. Its values and business goals are closely aligned with Sound Physicians, and our hospital partners. I look forward to benefiting from Fresenius Medical Care’s leadership as significant majority shareholder in advancing innovation and improvement in the acute episode of care in hospitals and post-acute arenas throughout the U.S.”
Dr. Bessler added, “I also look forward to working more closely with both Ascension and Dignity, two of the nation’s leading and most forward thinking health systems, to further expand Sound’s leading clinical capabilities to additional healthcare facilities across the U.S.”
“Our investment in Sound Physicians represents a continued commitment to improving the quality of healthcare,” said Ron Kuerbitz, Chief Executive Officer of Fresenius Medical Care North America. “Sound Physicians and Fresenius Medical Care have common goals of improving patient outcomes and controlling the cost of healthcare. With Sound Physicians’ innovative solutions designed to drive process improvement, we see a significant potential for further advancements in improving the acute episode of care in both hospitals and post-acute care centers.”
“Ascension has worked diligently to engage and support physicians,” said Anthony J. Speranzo, Executive Vice President and Chief Financial Officer of Ascension. “In collaboration with our physicians, we have introduced solutions and opportunities designed to improve physician satisfaction as well as evidence-based protocols aligned with our mutual interest in quality and safety. Sound Physicians and Ascension share a deep respect for physicians, a commitment to improving quality while providing critical person-centered care to individuals in a variety of clinical settings across the care continuum.”
Michael D. Blaszyk, Senior Executive Vice President, Chief Corporate Officer and Chief Financial Officer of Dignity Health noted, “To be successful, healthcare organizations need a seamlessly integrated system focused on the patient’s acute episode of care. We see what Sound Physicians is doing in this regard and believe it is fully in line with Dignity Health’s philosophy of care. Overall, we see the approach that Sound Physicians is taking in the continuum of acute care and believe we are right on target with where we feel health care needs to be headed now and in the future. With Sound Physicians, it is possible for health systems to make strategic decisions that better align the goals of the health system, payors and patients.”
Ian Sacks, Managing Director of TowerBrook Capital Partners, commented, “We have enjoyed a wonderful partnership with Sound and its management team, during which time Sound has established itself as an important and value-added partner to many leading hospitals and healthcare systems throughout the U.S. We believe that Sound is well positioned to continue to deliver unique and important inpatient solutions throughout the transitioning healthcare landscape, and we look forward to working with Fresenius, Ascension and Dignity to further Sound’s capabilities and expansion efforts.”
J.P. Morgan is acting as Sound Physicians’ financial advisor in this transaction, and Kirkland & Ellis LLP, Kutak Rock LLP and Simpson Thacher & Bartlett LLP are acting as Sound Physicians’ legal counsel. Dentons is acting as Fresenius Medical Care’s legal counsel and bridge financing to close the transaction was provided by Wells Fargo.