Orlando Health's Outpatient Play
Orlando Health is making a significant push into outpatient and specialty care, highlighted by the opening of the Southeast's only orthopedic-specific hospital. The move is paired with a leadership change, with the system elevating a new CFO experienced in multi-site financial management, signaling a clear strategic focus on expanding its ambulatory footprint.
The strategic shift to outpatient settings is increasingly driven by major private payers like UnitedHealthcare, Anthem, and Cigna, who have implemented policies restricting reimbursement for MRIs and CTs performed in more expensive hospital-based imaging departments. This top-down pressure forces patient volume into lower-cost freestanding centers, compelling health systems to either build, buy, or partner to create their own ambulatory imaging networks to retain that volume. This reimbursement pressure is happening as the U.S. outpatient imaging market is booming, with its growth outpacing the overall radiology market. Projections show advanced outpatient imaging, particularly CT and PET scans, is set to grow by 13-14% over the next decade. Currently, about 40% of all radiology procedures are already performed in outpatient clinics and centers. Florida, in particular, is a hotbed for healthcare real estate development, with medical office buildings averaging a 94% occupancy rate and rents climbing 23.5% over the last five years. Orlando Health is leaning into this trend with a $750 million investment to expand its footprint in the region, including new physician offices and freestanding emergency departments alongside its hospital projects. The new Orlando Health Jewett Orthopedic Institute is a 375,000-square-foot complex designed as a comprehensive destination for orthopedic and sports medicine care. By co-locating a specialty hospital with a medical pavilion, the system aims to capture a full range of services, from diagnostics to treatment and rehabilitation, under a single, highly-efficient operational umbrella. This ambulatory expansion follows a period of significant growth for Orlando Health, which saw its annual outpatient visits jump by 43% and revenues climb to nearly $9.9 billion in fiscal year 2025, fueled by major acquisitions. The system's strategy involves not just building new facilities but also integrating new care models, like its STAR Outpatient Centers, to manage post-discharge care and reduce hospital readmissions.
