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Sue Ogrocki / AP

The health care deals that grab the most attention involve pharmaceuticals, insurance or hospitals. But there's quietly been massive consolidation among ambulatory surgery centers — outpatient facilities where physicians perform routine procedures, such as elbow or cataract surgeries, and get patients back home in less than a day.

Why there's been a buying spree: More care is being done in the outpatient setting, since it's less expensive than getting the same care inside a hospital. Yet, surgery centers are very lucrative because they don't handle emergency procedures. The business model resembles a high-profit assembly line: Schedule as many quick, elective surgeries as possible, mostly for people who have better-paying commercial health insurance. Here are some telling 2016 figures from the biggest surgery center chains, according to each company's latest financial filing:

  • Envision Healthcare (260 surgery centers): 31% operating margin on $1.3 billion of revenue
  • Surgical Care Affiliates (197 surgery centers): 19% margin on $1.3 billion of revenue
  • Surgery Partners (99 surgery centers): 17% operating margin on $1.1 billion of revenue

Surgery center companies often jointly own their facilities with local hospitals, but they've also become targets for big players looking to cash in on the outpatient trend. UnitedHealth Group, the parent company of the largest health insurer in the country, scooped up SCA in a $2.3 billion deal. Hospital chain Tenet Healthcare bought United Surgical Partners International in 2015, mimicking how HCA has built up its surgery center fleet. AmSurg was a large surgery center chain until it agreed to merge with Envision last year.

Expect more activity: There are 5,500 ambulatory surgery centers in the United States. Financial analysts with Barclays estimate half are not owned by a chain, leaving "ample room" for deals.

Go deeper

Prosecutor: Fatal police shooting of Andrew Brown Jr. was "justified"

Khalil Ferebee (C), the son of Andrew Brown Jr., and attorneys Bakari Sellers (L) and Harry Daniel (R) at a May 11 news conference in Elizabeth City, North Carolina. Photo: Sean Rayford/Getty Images

A North Carolina prosecutor said Tuesday that the death of Andrew Brown Jr., a Black man fatally shot by sheriff's deputies last month, was "tragic" but "justified," due to the immediate threat officers believed Brown posed.

Why it matters: The FBI has opened a civil rights investigation into Brown's death. Police in Elizabeth City shot him five times, including in the back of his head, according to an independent autopsy report released by family attorneys last month.

McCarthy comes out against bipartisan deal on Jan. 6 commission

Photo: Win McNamee/Getty Images

House Minority Leader Kevin McCarthy (R-Calif.) will oppose a bipartisan deal announced last week that would form a 9/11-style commission to investigate the Jan. 6 Capitol riot, his office announced Tuesday.

Why it matters: McCarthy's opposition to the deal, which was negotiated by the top Republican and Democrat on the House Homeland Security Committee, underscores the internal divisions that continue to plague the GOP in the wake of Jan. 6.

2 hours ago - World

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Illustration: Sarah Grillo/Axios

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Why it matters: China's huge markets are attracting investment from multinational corporations and shaping the behavior of its own globe-trotting companies — giving international heft to the country's idiosyncratic antitrust enforcement and putting it on a collision course with Western-style regulation.