SEC Filings

AMSURG CORP filed this Form 10-12G/A on 05/09/1997
Entire Document
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     RELATIONSHIPS WITH PHYSICIAN PARTNERS.  AmSurg's business depends upon,
among other things, the efforts and success of the physicians who provide
medical services at the surgery centers or who are employed by AmSurg physician
practices and the strength of AmSurg's relationship with such physicians.
AmSurg's business could be adversely affected by any failure of these physicians
to maintain the quality of medical care or otherwise adhere to required
professional guidelines at AmSurg surgery centers and physician practices, any
damage to the reputation of a key physician or group of physicians, or the
impairment of AmSurg's relationship with a key physician or group of physicians.
AmSurg's ownership interests in practice-based ambulatory surgery centers and
specialty physician networks generally are structured through limited and
general partnerships or limited liability companies. AmSurg maintains a majority
interest in each partnership or limited liability company, with physicians or
physician practice groups holding minority limited partnership interests or
serving as minority members. AmSurg, as owner of majority interests in such
partnerships and limited liability companies, owes a fiduciary duty to the
minority interest holders in such entities and may encounter conflicts between
the respective interests of AmSurg and the minority holders. In such cases,
AmSurg's directors are obligated to exercise reasonable, good-faith judgment to
resolve the conflicts and may not be free to act solely in the best interest of
     Upon the occurrence of certain fundamental regulatory changes, AmSurg will
be obligated to purchase some or all of the minority interests of the physicians
affiliated with AmSurg in the partnerships or limited liability companies which
own and operate AmSurg's surgery centers. The regulatory changes that could
trigger such an obligation include changes that: (i) make the referral of
Medicare and other patients to AmSurg's surgery centers by physicians affiliated
with AmSurg illegal; (ii) create the substantial likelihood that cash
distributions from the partnership or limited liability company to the
physicians associated therewith will be illegal; or (iii) cause the ownership by
the physicians of interests in the partnerships or limited liability companies
to be illegal. There can be no assurance that AmSurg's existing capital
resources would be sufficient for it to meet the obligation, if it arises, to
purchase minority interests held by physicians in the partnerships or limited
liability companies which own and operate AmSurg's surgery centers. The
determination of whether a triggering event has occurred is made by the
concurrence of counsel for AmSurg and the physician partners or, in the absence
of such concurrence, by independent counsel having an expertise in healthcare
law and who is chosen by both parties. Such determination is therefore not
within the control of AmSurg. While AmSurg has structured the repurchase
obligations to be as favorable as possible to AmSurg, the triggering of these
obligations could have a material adverse effect on the financial condition and
results of operations of AmSurg. See "BUSINESS OF AMSURG -- Acquisition and
Development of Surgery Centers; and -- Government Regulation."
     CAPITATED PAYMENT ARRANGEMENTS.  In 1996, approximately 10% of AmSurg's
total revenues were derived from capitated payment arrangements. A significant
part of AmSurg's growth strategy involves assisting its surgery centers, owned
physician practices and specialty physician networks in obtaining capitated
managed care contracts and managing the medical risk associated with such
contracts. Such capitated managed care contracts typically are with HMOs. Under
such contracts the provider accepts a pre-determined amount per patient per
month, referred to as a "capitation" payment, and in return is responsible for
providing all necessary specified covered services to the patients covered by
the contract, thus shifting much of the risk of providing care from the payor to
the provider. Such an arrangement results in a greater predictability of
revenue, but exposes the provider to the risk of adequately predicting the costs
of providing the services. To the extent that patients covered by such contracts
require more frequent or extensive care than is anticipated, operating margins
may be reduced and the revenue derived from such contracts may be insufficient
to cover the costs of the services provided. There can be no assurance that
AmSurg will be able to negotiate satisfactory risk-sharing or capitated
arrangements on behalf of its surgery centers, owned physician practices and
specialty physician networks. See "BUSINESS OF AMSURG."
     DEPENDENCE ON THIRD-PARTY REIMBURSEMENT.  AmSurg is dependent upon private
and governmental third-party sources of reimbursement for services provided to
patients in AmSurg's centers and physician practices. In addition to market and
cost factors affecting the fee structure implemented by centers and practices
operated by AmSurg, numerous Medicare and Medicaid regulations, cost containment
and utilization decisions of third-party payors and other payment factors over
which AmSurg has no control may