##### Table of Contents



UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-K
 Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 For the Fiscal Year Ended December 31, 2007
Commission File Number 000-22217
 AMSURG CORP.
 (Exact Name of Registrant as Specified in Its Charter)
 Tennessee(State or Other Jurisdiction of Incorporation or Organization)
    
    62-1493316(I.R.S. Employer Identification No.)
 20 Burton Hills Boulevard, Nashville, TN(Address of Principal Executive Offices)
    
    37215(Zip Code)
 (615) 665-1283  (Registrants Telephone Number, Including Area Code)
 Securities registered pursuant to Section 12(b) of the Act:
    
    Common Stock, no par value

(Title of class)Nasdaq Global Select Market(Name of each exchange on which registered)
 None
  þ o
  o þ
  þ o
 þ
  Large accelerated filer þ
    
    Accelerated filer o
    
    Non-accelerated filer o
    
    Smaller reporting company o(Do not check if a smaller reporting company)
  o þ
  Documents Incorporated by Reference




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##### 



Table of Contents to Annual Report on Form 10-K for the Fiscal Year Ended December 31, 2007
  
 Part IItem 1.
    
    Business
    
    
    1Item 1A.
    
    Risk Factors
    
    
    15Item 1B.
    
    Unresolved Staff Comments
    
    
    20Item 2.
    
    Properties
    
    
    20Item 3.
    
    Legal Proceedings
    
    
    20Item 4.
    
    Submission of Matters to a Vote of Security Holders
    
    
    20Executive Officers of the Registrant
    
    
    21Part IIItem 5.
    
    Market for Registrants Common Equity, Related Stockholder Matters and
Issuer Purchases of Equity Securities
    
    
    21Item 6.
    
    Selected Financial Data
    
    
    22Item 7.
    
    Managements Discussion and Analysis of Financial Condition and Results
of Operations
    
    
    23Item 7A.
    
    Quantitative and Qualitative Disclosures About Market Risk
    
    
    33Item 8.
    
    Financial Statements and Supplementary Data
    
    
    35Item 9.
    
    Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure
    
    
    58Item 9A.
    
    Controls and Procedures
    
    
    58Item 9B.
    
    Other Information
    
    
    60Part IIIItem 10.
    
    Directors, Executive Officers and Corporate Governance
    
    
    60Item 11.
    
    Executive Compensation
    
    
    60Item 12.
    
    Security Ownership of Certain Beneficial Owners and Management and
Related Stockholder Matters
    
    
    60Item 13.
    
    Certain Relationships and Related Transactions, and Director Independence
    
    
    61Item 14.
    
    Principal Accounting Fees and Services
    
    
    61Part IVItem 15.
    
    Exhibits and Financial Statement Schedules
    
    
    61Signatures
    
    
    
    
    65Ex-10.20 Restricted Share Award AgreementEx-10.21 Non-Qualified Stock Option AgreementEx-10.31 Schedule of Non-employee Director CompensationEx-21.1 List of SubsidiariesEx-23.1 Consent of Independent AuditorsEx-31.1 Section 302 Certification of the CEOEx-31.2 Section 302 Certification of the CFOEx-32.1 Section 906 Certification of the CEO & CFO
  i




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##### Table of Contents



Part I
 
 Item 1. Business
   Industry Overview
    Cost-Effective Alternative.
 Physician and Patient Preference.
 New Technology.
 1




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Item 1. Business  (continued)
 Strategy
  
    
    selectively acquire both single-specialty ASCs and muti-specialty ASCs with substantial
minority physician ownership;
    
    develop new ASCs in partnership with physicians; and
    
    grow revenues and profitability at our existing surgery centers.
  Acquisition and Development of Surgery Centers
   
    
    quality of the physicians and their growth opportunities in their market;
    
    the number of procedures currently being performed by the physicians;
    
    competition from and the fees being charged by other surgical providers;
    
    relative competitive market position of the physicians under consideration; and
    
    the ability to contract with payors in the market and state certificate of need, or CON,
requirements for the development of a new center.
  
    
    market position of the center and the physicians affiliated with the center;
    
    payor and case mix;
    
    growth opportunities;
    
    staffing and supply review;
    
    equipment assessment; and
    
    opportunities for operational efficiencies.
  2




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##### Table of Contents



Item 1. Business  (continued)
     Growth in Revenues at Existing Facilities
  
    
    growth in the number of physicians performing procedures at our centers;
    
    obtaining new or more favorable managed care contracts for our centers;
    
    marketing our centers to referring physicians, payors and patients; and
    
    achieving efficiencies in center operations.
 Growth in the number of physicians performing procedures.
 
    
    advising the physicians affiliated with the ASCs in recruiting new physicians to their
practices;
    
    identifying additional physicians or physician practices to join the partnerships that
own the ASCs; and
    
    recruiting non-partner physicians in the same or other specialties to use excess
capacity at the ASCs.
  Obtaining new or more favorable managed care contracts.
 3




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##### Table of Contents



Item 1. Business  (continued)
  Marketing our centers to referring physicians, payors and patients.
 
    
    marketing our ASCs to referring physicians emphasizing the quality and high patient
satisfaction and lower cost at our ASCs;
    
    increasing awareness of the benefits of our ASCs with employers and patients through
public awareness programs, health fairs and screening programs, including local marketing
programs designed to educate employers and patients as to the health and cost benefits of
detecting colon cancer in its early stages through routine endoscopy procedures; and
    
    communicating with existing patients regarding follow-up procedures through care
coordination programs.
 Achieving efficiencies in center operations.
 
    
    physician scheduling enhancements;
    
    specially trained clinical staff focused on improved patient flow; and
    
    improved operating room turnover.
  Surgery Center Operations
   
    
    gastroenterology  colonoscopy and other endoscopy procedures;
    
    ophthalmology  cataracts and retinal laser surgery; and
    
    orthopedic  knee arthroscopy and carpal tunnel repair.
  4




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##### Table of Contents



Item 1. Business  (continued)
 Accreditation
  Surgery Center Locations
  Operating orAcquisition/
    
    ProcedureLocation
    
    Specialty
    
    Opening Date
    
    RoomsAcquired Centers:Knoxville, Tennessee
    
    Gastroenterology
    
    November 1992
    
    
    8Topeka, Kansas
    
    Gastroenterology
    
    November 1992
    
    
    3Nashville, Tennessee
    
    Gastroenterology
    
    November 1992
    
    
    3Washington, D.C.
    
    Gastroenterology
    
    November 1993
    
    
    3Torrance, California
    
    Gastroenterology
    
    February 1994
    
    
    2Maryville, Tennessee
    
    Gastroenterology
    
    January 1995
    
    
    3Miami, Florida
    
    Gastroenterology
    
    April 1995
    
    
    5Panama City, Florida
    
    Gastroenterology
    
    July 1996
    
    
    3Ocala, Florida
    
    Gastroenterology
    
    August 1996
    
    
    3Columbia, South Carolina
    
    Gastroenterology
    
    October 1996
    
    
    4Wichita, Kansas
    
    Orthopedic
    
    November 1996
    
    
    3Crystal River, Florida
    
    Gastroenterology
    
    January 1997
    
    
    3Abilene, Texas
    
    Ophthalmology
    
    March 1997
    
    
    2Fayetteville, Arkansas
    
    Gastroenterology
    
    May 1997
    
    
    3Independence, Missouri
    
    Gastroenterology
    
    September 1997
    
    
    1Kansas City, Missouri
    
    Gastroenterology
    
    September 1997
    
    
    1Phoenix, Arizona
    
    Ophthalmology
    
    February 1998
    
    
    2Denver, Colorado
    
    Gastroenterology
    
    April 1998
    
    
    4Sun City, Arizona
    
    Ophthalmology
    
    May 1998
    
    
    5Baltimore, Maryland
    
    Gastroenterology
    
    November 1998
    
    
    3Naples, Florida
    
    Gastroenterology
    
    November 1998
    
    
    3Boca Raton, Florida
    
    Ophthalmology
    
    December 1998
    
    
    2Indianapolis, Indiana
    
    Gastroenterology
    
    June 1999
    
    
    4Chattanooga, Tennessee
    
    Gastroenterology
    
    July 1999
    
    
    3Mount Dora, Florida
    
    Ophthalmology
    
    September 1999
    
    
    2Oakhurst, New Jersey
    
    Gastroenterology
    
    September 1999
    
    
    2Cape Coral, Florida
    
    Gastroenterology
    
    November 1999
    
    
    2La Jolla, California
    
    Gastroenterology
    
    December 1999
    
    
    2Burbank, California
    
    Ophthalmology
    
    December 1999
    
    
    1Waldorf, Maryland
    
    Gastroenterology
    
    December 1999
    
    
    2Las Vegas, Nevada
    
    Ophthalmology
    
    December 1999
    
    
    2Glendale, California
    
    Ophthalmology
    
    January 2000
    
    
    1Las Vegas, Nevada
    
    Ophthalmology
    
    May 2000
    
    
    2Hutchinson, Kansas
    
    Ophthalmology
    
    June 2000
    
    
    2New Orleans, Louisiana
    
    Ophthalmology
    
    July 2000
    
    
    2Kingston, Pennsylvania
    
    Ophthalmology, Pain Management
    
    December 2000
    
    
    3Inverness, Florida
    
    Gastroenterology
    
    December 2000
    
    
    3Columbia, Tennessee
    
    Orthopedic, Ophthalmology
    
    February 2001
    
    
    2Bel Air, Maryland
    
    Gastroenterology
    
    February 2001
    
    
    2Dover, Delaware
    
    Ophthalmology
    
    February 2001
    
    
    3Sarasota, Florida
    
    Ophthalmology
    
    February 2001
    
    
    2Greensboro, North Carolina
    
    Ophthalmology
    
    March 2001
    
    
    4Ft. Lauderdale, Florida
    
    Ophthalmology
    
    March 2001
    
    
    3Bloomfield, Connecticut
    
    Ophthalmology
    
    July 2001
    
    
    1
 5




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##### Table of Contents



Item 1. Business  (continued)
 Operating orAcquisition/
    
    ProcedureLocation
    
    Specialty
    
    Opening Date
    
    RoomsFt. Myers, Florida
    
    Gastroenterology, Pain
Management
    
    July 2001
    
    
    2Lawrenceville, New Jersey
    
    Orthopedic
    
    October 2001
    
    
    3Newark, Delaware
    
    Gastroenterology
    
    October 2001
    
    
    5Alexandria, Louisiana
    
    Ophthalmology
    
    December 2001
    
    
    2Akron, Ohio
    
    Gastroenterology
    
    December 2001
    
    
    2Paducah, Kentucky
    
    Ophthalmology
    
    May 2002
    
    
    2Columbia, Tennessee
    
    Gastroenterology
    
    June 2002
    
    
    2Ft. Myers, Florida
    
    Ophthalmology
    
    July 2002
    
    
    2Tulsa, Oklahoma
    
    Ophthalmology
    
    July 2002
    
    
    3Weslaco, Texas
    
    Ophthalmology
    
    September 2002
    
    
    2Peoria, Arizona
    
    Multispecialty
    
    October 2002
    
    
    3Lewes, Delaware
    
    Gastroenterology
    
    December 2002
    
    
    2Rogers, Arkansas
    
    Ophthalmology
    
    December 2002
    
    
    2Winter Haven, Florida
    
    Ophthalmology
    
    December 2002
    
    
    2Mesa, Arizona
    
    Gastroenterology
    
    December 2002
    
    
    4Voorhees, New Jersey
    
    Gastroenterology
    
    March 2003
    
    
    4St. George, Utah
    
    Gastroenterology
    
    July 2003
    
    
    2San Antonio, Texas
    
    Gastroenterology
    
    July 2003
    
    
    4Pueblo, Colorado
    
    Ophthalmology
    
    September 2003
    
    
    2Reno, Nevada
    
    Gastroenterology
    
    December 2003
    
    
    4Edina, Minnesota
    
    Ophthalmology
    
    December 2003
    
    
    1Gainesville, Florida
    
    Orthopedic
    
    February 2004
    
    
    5West Palm, Florida
    
    Gastroenterology
    
    March 2004
    
    
    2Raleigh, North Carolina
    
    Gastroenterology
    
    April 2004
    
    
    4Sun City, Arizona
    
    Gastroenterology
    
    September 2004
    
    
    2Casper, Wyoming
    
    Gastroenterology
    
    October 2004
    
    
    2Rockville, Maryland
    
    Gastroenterology
    
    October 2004
    
    
    5Overland Park, Kansas
    
    Gastroenterology
    
    October 2004
    
    
    3Lake Bluff, Illinois
    
    Gastroenterology
    
    November 2004
    
    
    3San Luis, California
    
    Gastroenterology
    
    December 2004
    
    
    2Templeton, California
    
    Gastroenterology
    
    December 2004
    
    
    2Lutherville, Maryland
    
    Gastroenterology
    
    January 2005
    
    
    2Tacoma, Washington
    
    Gastroenterology
    
    March 2005
    
    
    5Tacoma, Washington
    
    Gastroenterology
    
    March 2005
    
    
    2Tacoma, Washington
    
    Gastroenterology
    
    March 2005
    
    
    2Tacoma, Washington
    
    Gastroenterology
    
    March 2005
    
    
    2Orlando, Florida
    
    Gastroenterology
    
    June 2005
    
    
    1Orlando, Florida
    
    Gastroenterology
    
    June 2005
    
    
    4Ocala, Florida
    
    Ophthalmology
    
    June 2005
    
    
    3Scranton, Pennsylvania
    
    Gastroenterology
    
    August 2005
    
    
    3Towson, Maryland
    
    Gastroenterology
    
    August 2005
    
    
    4Yuma, Arizona
    
    Gastroenterology
    
    October 2005
    
    
    3St. Louis, Missouri
    
    Orthopedic
    
    November 2005
    
    
    2Salem, Oregon
    
    Ophthalmology
    
    December 2005
    
    
    2West Orange, New Jersey
    
    Gastroenterology
    
    December 2005
    
    
    3St. Cloud, Minnesota
    
    Ophthalmology
    
    December 2005
    
    
    2Tulsa, Oklahoma
    
    Gastroenterology
    
    December 2005
    
    
    3Laurel, Maryland
    
    Gastroenterology
    
    December 2005
    
    
    3Torrance, California
    
    Multispecialty
    
    February 2006
    
    
    4Nashville, Tennessee
    
    Ophthalmology
    
    February 2006
    
    
    2Arcadia, California
    
    Gastroenterology
    
    March 2006
    
    
    2Towson, Maryland
    
    Gastroenterology
    
    August 2006
    
    
    2Woodlands, Texas
    
    Gastroenterology
    
    September 2006
    
    
    2Bala Cynwyd, Pennsylvania
    
    Gastroenterology
    
    September 2006
    
    
    2Malvern, Pennsylvania
    
    Gastroenterology
    
    September 2006
    
    
    3Oakland, California
    
    Gastroenterology
    
    October 2006
    
    
    3South Bend, Indiana
    
    Gastroenterology
    
    January 2007
    
    
    4Lancaster, Pennsylvania
    
    Gastroenterology
    
    January 2007
    
    
    2Silver Spring, Maryland
    
    Gastroenterology
    
    January 2007
    
    
    2
 6




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##### Table of Contents



Item 1. Business  (continued)
 Operating orAcquisition/
    
    ProcedureLocation
    
    Specialty
    
    Opening Date
    
    RoomsRockville, Maryland
    
    Gastroenterology
    
    January 2007
    
    
    3New Orleans, Louisiana
    
    Gastroenterology
    
    January 2007
    
    
    2Marrero, Louisiana
    
    Gastroenterology
    
    January 2007
    
    
    2Metairie, Louisiana
    
    Gastroenterology
    
    January 2007
    
    
    3Toms River, New Jersey
    
    Gastroenterology
    
    May 2007
    
    
    2Pottsville, Pennsylvania
    
    Gastroenterology
    
    June 2007
    
    
    3Memphis, Tennessee
    
    Gastroenterology
    
    July 2007
    
    
    4Kissimmee, Florida
    
    Gastroenterology
    
    July 2007
    
    
    1Glendora, California
    
    Gastroenterology
    
    August 2007
    
    
    4Mesquite, Texas
    
    Gastroenterology
    
    August 2007
    
    
    2Conroe, Texas
    
    Gastroenterology
    
    August 2007
    
    
    4Altamonte Springs, Florida
    
    Gastroenterology
    
    September 2007
    
    
    3New Port Richey, Florida
    
    Multispecialty
    
    October 2007
    
    
    3Glendale, Arizona
    
    Gastroenterology
    
    October 2007
    
    
    3Orlando, Florida
    
    Gastroenterology
    
    October 2007
    
    
    1San Diego, California
    
    Multispecialty
    
    November 2007
    
    
    4Poway, California
    
    Multispecialty
    
    November 2007
    
    
    2Baton Rouge, Louisiana
    
    Gastroenterology
    
    December 2007
    
    
    10Developed Centers:Santa Fe, New Mexico
    
    Gastroenterology
    
    May 1994
    
    
    3Tarzana, California
    
    Gastroenterology
    
    July 1994
    
    
    3Beaumont, Texas
    
    Gastroenterology
    
    October 1994
    
    
    5Abilene, Texas
    
    Gastroenterology
    
    December 1994
    
    
    3Knoxville, Tennessee
    
    Ophthalmology
    
    June 1996
    
    
    2Sidney, Ohio
    
    Multispecialty
    
    December 1996
    
    
    4Montgomery, Alabama
    
    Ophthalmology
    
    May 1997
    
    
    2Willoughby, Ohio
    
    Gastroenterology
    
    July 1997
    
    
    2Milwaukee, Wisconsin
    
    Gastroenterology
    
    July 1997
    
    
    3Chevy Chase, Maryland
    
    Gastroenterology
    
    July 1997
    
    
    4Melbourne, Florida
    
    Gastroenterology
    
    August 1997
    
    
    2Lorain, Ohio
    
    Gastroenterology
    
    August 1997
    
    
    2Hillmont, Pennsylvania
    
    Gastroenterology
    
    October 1997
    
    
    2Minneapolis, Minnesota
    
    Gastroenterology
    
    November 1997
    
    
    2Hialeah, Florida
    
    Gastroenterology
    
    December 1997
    
    
    3Cincinnati, Ohio
    
    Gastroenterology
    
    January 1998
    
    
    3Evansville, Indiana
    
    Ophthalmology
    
    February 1998
    
    
    2Shawnee, Kansas
    
    Gastroenterology
    
    April 1998
    
    
    3Salt Lake City, Utah
    
    Gastroenterology
    
    April 1998
    
    
    2Oklahoma City, Oklahoma
    
    Gastroenterology
    
    May 1998
    
    
    4El Paso, Texas
    
    Gastroenterology
    
    December 1998
    
    
    4Toledo, Ohio
    
    Gastroenterology
    
    December 1998
    
    
    3Florham Park, New Jersey
    
    Gastroenterology
    
    December 1999
    
    
    3Minneapolis, Minnesota
    
    Ophthalmology
    
    June 2000
    
    
    2Crestview Hills, Kentucky
    
    Gastroenterology
    
    September 2000
    
    
    3Louisville, Kentucky
    
    Gastroenterology
    
    September 2000
    
    
    3Louisville, Kentucky
    
    Ophthalmology
    
    September 2000
    
    
    2Ft. Myers, Florida
    
    Gastroenterology
    
    October 2000
    
    
    3Seneca, Pennsylvania
    
    Multispecialty
    
    October 2000
    
    
    4Sarasota, Florida
    
    Gastroenterology
    
    December 2000
    
    
    2Tamarac, Florida
    
    Gastroenterology
    
    December 2000
    
    
    2Inglewood, California
    
    Gastroenterology
    
    May 2001
    
    
    3Clemson, South Carolina
    
    Orthopedic
    
    September 2002
    
    
    3Middletown, Ohio
    
    Gastroenterology
    
    October 2002
    
    
    3Troy, Michigan
    
    Gastroenterology
    
    August 2003
    
    
    3Kingsport, Tennessee
    
    Ophthalmology
    
    October 2003
    
    
    2Columbia, South Carolina
    
    Gastroenterology
    
    November 2003
    
    
    2Columbus, Ohio
    
    Gastroenterology
    
    February 2004
    
    
    3
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##### Table of Contents



Item 1. Business  (continued)
 Operating orAcquisition/
    
    ProcedureLocation
    
    Specialty
    
    Opening Date
    
    RoomsGreenville, South Carolina
    
    Gastroenterology
    
    August 2004
    
    
    4Sebring, Florida
    
    Ophthalmology
    
    November 2004
    
    
    2Temecula, California
    
    Gastroenterology
    
    November 2004
    
    
    2Escondido, California
    
    Gastroenterology
    
    December 2004
    
    
    2Tampa, Florida
    
    Gastroenterology
    
    January 2005
    
    
    8Los Alamos, New Mexico
    
    Gastroenterology
    
    March 2005
    
    
    1Rockledge, Florida
    
    Gastroenterology
    
    May 2005
    
    
    3Lakeland, Florida
    
    Gastroenterology
    
    May 2005
    
    
    4Liberty, Missouri
    
    Gastroenterology
    
    June 2005
    
    
    1Knoxville, Tennessee
    
    Gastroenterology
    
    September 2005
    
    
    2Sun City, Arizona
    
    Gastroenterology
    
    November 2005
    
    
    3Port Huron, Michigan
    
    Orthopedic
    
    March 2006
    
    
    2Hanover, New Jersey
    
    Gastroenterology
    
    October 2006
    
    
    3Raleigh, North Carolina
    
    Gastroenterology
    
    December 2006
    
    
    3San Antonio, Texas
    
    Gastroenterology
    
    May 2007
    
    
    3Raleigh, North Carolina
    
    Gastroenterology
    
    November 2007
    
    
    4El Dorado, Arkansas
    
    Multispecialty
    
    December 2007
    
    
    2489
  Revenues
    8




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##### Table of Contents



Item 1. Business  (continued)
  
    
    ASCs will be paid based upon a percentage of the payments to hospital outpatient
departments pursuant to the hospital outpatient prospective payment system;
    
    a scheduled phase in of the revised rates over four years, beginning January 1, 2008;
and
    
    an annual increase in the ASC rates beginning in 2010 based on the consumer price index.
   Competition
  Competition for Center Acquisitions.
 Competition for Joint Venture Development of Centers.
 Competition for Physicians to Utilize our Centers, Patients and Managed Care Contracts.
 Government Regulation
  9




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##### Table of Contents



Item 1. Business  (continued)
  CONs and State Licensing
  Corporate Practice of Medicine
 Certification
  Medicare-Medicaid Fraud and Abuse Provisions
 10




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##### Table of Contents



Item 1. Business  (continued)
     
    
    the limited partnerships and limited liability companies exist to effect legitimate
business purposes, including the ownership, operation and continued improvement of high
quality, cost-effective and efficient services to the patients served;
    
    the limited partnerships and limited liability companies function as an extension of the
group practices of physicians who are affiliated with the surgery centers and the surgical
procedures are performed personally by these physicians without referring the patients
outside of their practice;
    
    our physician partners have a substantial investment at risk in the limited partnerships
and limited liability companies;
    
    terms of the investment do not take into account volume of the physician partners past
or anticipated future services provided to patients of the centers;
    
    the physician partners are not required or encouraged as a condition of the investment
to treat Medicare or Medicaid patients at the centers or to influence others to refer such
patients to the centers for treatment;
    
    the limited partnerships, the limited liability companies, our subsidiaries and our
affiliates will not loan any funds to or guarantee any debt on behalf of the physician
partners with respect to their investment; and
    
    distributions by the limited partnerships and limited liability companies are allocated
uniformly in proportion to ownership interests.
  11




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##### Table of Contents



Item 1. Business  (continued)
      Prohibition on Physician Ownership of Healthcare Facilities and Certain Self-Referrals
  12




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##### Table of Contents



Item 1. Business  (continued)
   We
may be already impacted by judicial, regulatory and legislative developments in New Jersey.
 The Federal False Claims Act and Similar Federal and State Laws.
  Healthcare Industry Investigations
 13




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##### Table of Contents



Item 1. Business  (continued)
  Privacy Requirements and Administrative Simplification.
 Obligations to Buy Out Physician Partners
 Employees
  Legal Proceedings and Insurance
   Available Information
 Form 10-Q
 14




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##### Table of Contents



Item 1. Business  (continued)
  
 Item 1A. Risk Factors
  We depend on payments from third-party payors, including government healthcare programs. If these
payments decrease or do not increase as our costs increase, our operating margins and profitability
would be adversely affected.
 Our business would be adversely affected if we fail to maintain good relationships with the
physician partners who use our surgery centers.
 If we fail to acquire and develop additional surgery centers on favorable terms, our future growth
and operating results could be adversely affected.
 15




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##### Table of Contents



Item 1A. Risk Factors  (continued)
 If we are unable to increase procedure volume at our existing centers, our operating margins and
profitability could be adversely affected.
 If we are unable to manage the growth in our business, our operating results could be adversely
affected.
 If we do not have sufficient capital resources to complete acquisitions and develop new surgery
centers, our growth and results of operations could be adversely affected.
 If we are unable to effectively compete for physician partners, managed care contracts, patients
and strategic relationships, our business would be adversely affected.
  We operate a significant number of surgery centers in Florida, which makes us sensitive to weather
and other factors in Florida.
 16




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##### Table of Contents



Item 1A. Risk Factors  (continued)
 We may be adversely impacted by judicial, regulatory and legislative developments in the State of
New Jersey.
  If we fail to comply with applicable laws and regulations, we could suffer penalties or be required
to make significant changes to our operations.
 
    
    physician ownership of our surgery centers;
    
    CON approvals and other regulations affecting the construction or acquisition of
centers, capital expenditures or the addition of services;
    
    the adequacy of medical care, equipment, personnel, and operating policies and
procedures;
    
    qualifications of medical and support personnel;
    
    maintenance and protection of records;
    
    billing for services by healthcare providers, including appropriate treatment of
overpayments and credit balances;
    
    privacy and security of individually identifiable health information; and
    
    environmental protection.
 If we fail to comply with applicable laws and regulations, we could suffer civil or criminal
penalties, including the loss of our licenses to operate and our ability to participate in
Medicare, Medicaid and other government sponsored and third-party healthcare programs
 If a federal or state agency asserts a different position or enacts new laws or regulations
regarding illegal remuneration or other forms of fraud and abuse, we could suffer penalties or be
required to make significant changes to our operations.
 17




---



##### Table of Contents



Item 1A. Risk Factors  (continued)
    Providers in the healthcare industry have been the subject of federal and state investigations, and
we may become subject to investigations in the future.
  If regulations or regulatory interpretations change, we may be obligated to buy out interests of
physicians who are minority owners of the surgery centers.
 
    
    make the referral of Medicare and other patients to our surgery centers by physicians
affiliated with us illegal;
    
    create the substantial likelihood that cash distributions from the limited partnerships
or limited liability companies to the affiliated physicians will be illegal; or
    
    cause the ownership by the physicians of interests in the limited partnerships or
limited liability companies to be illegal.
 18




---



##### Table of Contents



Item 1A. Risk Factors  (continued)
  We are liable for the debts and other obligations of the limited partnerships that own and operate
certain of our surgery centers.
 We have a legal responsibility to the minority owners of the entities through which we own our
surgery centers, which may conflict with our interests and prevent us from acting solely in our own
best interests.
 We may write-off intangible assets, such as goodwill.
 The IRS may challenge tax deductions for certain acquired goodwill.
 19




---



##### Table of Contents



Item 1A. Risk Factors  (continued)
  
 Item 1B. Unresolved Staff Comments
  
 Item 2. Properties
  
 Item 3. Legal Proceedings
  
 Item 4. Submission of Matters to a Vote of Security Holders
  20




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##### Table of Contents



EXECUTIVE OFFICERS OF THE REGISTRANT
  Name
    
    Age
    
    ExperienceChristopher A. Holden
    
    
    43
    
    
    Chief Executive Officer and Director since October 2007;
Senior Vice President and a Division President of Triad
Hospitals Inc. from May 1999 to July 2007; President  West
Division of the Central Group of Columbia/HCA Healthcare
Corporation from January 1998 to May 1999.Claire M. Gulmi
    
    
    54
    
    
    Executive Vice President since February 2006; Chief Financial
Officer since September 1994; Director since May 2004; Senior
Vice President from March 1997 to February 2006; Secretary
since December 1997; Vice President from September 1994
through March 1997.David L. Manning
    
    
    58
    
    
    Executive Vice President and Chief Development Officer since
February 2006; Senior Vice President of Development and
Assistant Secretary from April 1992 to February 2006.Royce D. Harrell
    
    
    62
    
    
    Senior Vice President of Corporate Services since September
2000; Senior Vice President of Operations from October 1992
until September 2000.Billie A. Payne
    
    
    56
    
    
    Senior Vice President of Operations since December 2007;
Vice President of Operations from March 1998 to December 2007.
 
 PART II
 
 Item 5. Market for Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of
Equity Securities
  1st
    
    2nd
    
    3rd
    
    4thQuarter
    
    Quarter
    
    Quarter
    
    Quarter2006:High
    
    $
    23.99
    
    
    $
    27.00
    
    
    $
    25.45
    
    
    $
    23.91Low
    
    $
    20.61
    
    
    $
    22.18
    
    
    $
    19.68
    
    
    $
    19.942007:High
    
    $
    26.28
    
    
    $
    25.25
    
    
    $
    26.79
    
    
    $
    28.00Low
    
    $
    21.63
    
    
    $
    22.76
    
    
    $
    21.93
    
    
    $
    22.60
 
 21




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##### Table of Contents



Item 6. Selected Financial Data
 Year Ended December 31,2007
    
    2006
    
    2005
    
    2004
    
    2003(Dollars in thousands, except per share data)Consolidated Statement of Earnings Data:Revenues
    
    $
    531,085
    
    
    $
    455,869
    
    
    $
    378,451
    
    
    $
    317,943
    
    
    $
    269,909Operating expenses
    
    
    345,020
    
    
    
    295,083
    
    
    
    239,286
    
    
    
    195,905
    
    
    
    168,100Operating income
    
    
    186,065
    
    
    
    160,786
    
    
    
    139,165
    
    
    
    122,038
    
    
    
    101,809Minority interest
    
    
    105,003
    
    
    
    92,001
    
    
    
    76,898
    
    
    
    66,591
    
    
    
    56,206Interest and other expenses
    
    
    9,777
    
    
    
    7,665
    
    
    
    4,121
    
    
    
    1,945
    
    
    
    1,429Earnings from continuing operations before income
taxes
    
    
    71,285
    
    
    
    61,120
    
    
    
    58,146
    
    
    
    53,502
    
    
    
    44,174Income tax expense
    
    
    27,734
    
    
    
    23,733
    
    
    
    22,794
    
    
    
    21,169
    
    
    
    17,670Net earnings from continuing operations
    
    
    43,551
    
    
    
    37,387
    
    
    
    35,352
    
    
    
    32,333
    
    
    
    26,504Earnings from operations of discontinued interests
in surgery centers, net of income tax
    
    
    294
    
    
    
    815
    
    
    
    785
    
    
    
    1,775
    
    
    
    3,622Gain (loss) on disposal of discontinued interests in
surgery centers, net of income tax
    
    
    330
    
    
    
    (463
    )
    
    
    (986
    )
    
    
    5,598
    
    
    
    Net earnings
    
    $
    44,175
    
    
    $
    37,739
    
    
    $
    35,151
    
    
    $
    39,706
    
    
    $
    30,126Basic earnings per common share:Net earnings from continuing operations
    
    $
    1.42
    
    
    $
    1.25
    
    
    $
    1.20
    
    
    $
    1.08
    
    
    $
    0.88Net earnings
    
    $
    1.44
    
    
    $
    1.27
    
    
    $
    1.19
    
    
    $
    1.33
    
    
    $
    1.00Diluted earnings per common share:Net earnings from continuing operations
    
    $
    1.40
    
    
    $
    1.23
    
    
    $
    1.17
    
    
    $
    1.06
    
    
    $
    0.86Net earnings
    
    $
    1.42
    
    
    $
    1.24
    
    
    $
    1.17
    
    
    $
    1.30
    
    
    $
    0.98Weighted average number of shares and share
equivalents outstanding (in thousands):Basic
    
    
    30,619
    
    
    
    29,822
    
    
    
    29,573
    
    
    
    29,895
    
    
    
    30,139Diluted
    
    
    31,102
    
    
    
    30,398
    
    
    
    30,147
    
    
    
    30,507
    
    
    
    30,666Operating and Other Financial Data:Continuing centers at end of year
    
    
    176
    
    
    
    152
    
    
    
    141
    
    
    
    117
    
    
    
    102Procedures performed during year
    
    
    980,858
    
    
    
    838,514
    
    
    
    719,890
    
    
    
    589,915
    
    
    
    505,907Same-center revenue increase
    
    
    4
    %
    
    
    5
    %
    
    
    3
    %
    
    
    4
    %
    
    
    7
    %Cash flows provided by operating activities
    
    $
    79,371
    
    
    $
    72,021
    
    
    $
    63,421
    
    
    $
    55,452
    
    
    $
    48,095Cash flows used in investing activities
    
    
    (179,368
    )
    
    
    (71,794
    )
    
    
    (83,308
    )
    
    
    (61,660
    )
    
    
    (48,384
    )Cash flows provided by (used in) financing activities
    
    
    109,867
    
    
    
    (640
    )
    
    
    25,391
    
    
    
    6,942
    
    
    
    1,227
 At December 31,2007
    
    2006
    
    2005
    
    2004
    
    2003(In thousands)Consolidated Balance Sheet Data:Cash and cash equivalents
    
    $
    29,953
    
    
    $
    20,083
    
    
    $
    20,496
    
    
    $
    14,992
    
    
    $
    14,258Working capital
    
    
    83,792
    
    
    
    66,591
    
    
    
    61,072
    
    
    
    56,302
    
    
    
    46,009Total assets
    
    
    781,634
    
    
    
    590,032
    
    
    
    527,816
    
    
    
    425,155
    
    
    
    356,189Long-term debt and other long-term liabilities
    
    
    232,223
    
    
    
    127,821
    
    
    
    125,712
    
    
    
    88,160
    
    
    
    53,137Minority interest
    
    
    62,006
    
    
    
    52,341
    
    
    
    47,271
    
    
    
    39,710
    
    
    
    36,796Shareholders equity
    
    
    411,225
    
    
    
    343,108
    
    
    
    294,618
    
    
    
    254,149
    
    
    
    232,898
 22




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##### Table of Contents



Item 7. Managements Discussion and Analysis of Financial Condition and Results of Operations
 Forward-Looking Statements
 This report contains certain forward-looking statements (all statements other than statements with
respect to historical fact) within the meaning of the federal securities laws, which are intended
to be covered by the safe harbors created thereby. Investors are cautioned that all
forward-looking statements involve known and unknown risks and uncertainties including, without
limitation, those described in Item 1A. Risk Factors, some of which are beyond our control.
Although we believe that the assumptions underlying the forward-looking statements contained herein
are reasonable, any of the assumptions could be inaccurate. Therefore, there can be no assurance
that the forward-looking statements included in this report will prove to be accurate. Actual
results could differ materially and adversely from those contemplated by any forward-looking
statement. In light of the significant risks and uncertainties inherent in the forward-looking
statements included herein, the inclusion of such information should not be regarded as a
representation by us or any other person that our objectives and plans will be achieved. We
undertake no obligation to publicly release any revisions to any forward-looking statements in this
discussion to reflect events and circumstances occurring after the date hereof or to reflect
unanticipated events. Forward-looking statements and our liquidity, financial condition and
results of operations may be affected by the risks set forth in Item 1A. Risk Factors or by other
unknown risks and uncertainties.
 Overview
  2007
    
    2006
    
    2005Centers in operation, beginning of the year
    
    
    156
    
    
    
    149
    
    
    
    128New center acquisitions placed in operation
    
    
    21
    
    
    
    8
    
    
    
    17New development centers placed in operation
    
    
    3
    
    
    
    3
    
    
    
    7Centers disposed
    
    
    (4
    )
    
    
    (4
    )
    
    
    (3
    )Centers in operation, end of the year
    
    
    176
    
    
    
    156
    
    
    
    149Centers under development, end of the year
    
    
    2
    
    
    
    5
    
    
    
    5Development centers awaiting regulatory approval, end of year
    
    
    1
    
    
    
    
    
    
    
    3Average number of continuing centers in operation, during year
    
    
    164
    
    
    
    146
    
    
    
    128Centers under letter of intent, end of year
    
    
    4
    
    
    
    10
    
    
    
    
   23




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##### Table of Contents



Item 7. Managements Discussion and Analysis of Financial Condition and Results of Operations  (continued)
 Sources of Revenues
     
    
    ASCs will be paid based upon a percentage of the payments to hospital outpatient
departments pursuant to the hospital outpatient prospective payment system;
    
    a scheduled phase in of the revised rates over four years, beginning January 1, 2008;
and
    
    an annual increase in the ASC rates beginning in 2010 based on the consumer price index.
  Critical Accounting Policies
  Principles of Consolidation.
 24




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##### Table of Contents



Item 7. Managements Discussion and Analysis of Financial Condition and Results of
Operations  (continued)
     Revenue Recognition.
 Allowance for Contractual Adjustments and Bad Debt Expense.
 Purchase Price Allocation. Business
Combinations.
 25




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##### Table of Contents



Item 7. Managements Discussion and Analysis of Financial Condition and Results of
Operations  (continued)
 Goodwill. Goodwill and Other Intangible Assets,
 Results of Operations
      26




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##### Table of Contents



Item 7. Managements Discussion and Analysis of Financial Condition and Results of
Operations  (continued)
  2007
    
    2006
    
    2005Revenues
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %Operating expenses:Salaries and benefits
    
    
    29.3
    
    
    
    29.7
    
    
    
    28.4Supply cost
    
    
    11.5
    
    
    
    11.5
    
    
    
    11.1Other operating expenses
    
    
    20.5
    
    
    
    19.8
    
    
    
    19.8Depreciation and amortization
    
    
    3.7
    
    
    
    3.7
    
    
    
    3.9Total operating expenses
    
    
    65.0
    
    
    
    64.7
    
    
    
    63.2Operating income
    
    
    35.0
    
    
    
    35.3
    
    
    
    36.8Minority interest
    
    
    19.8
    
    
    
    20.2
    
    
    
    20.3Interest expense, net of interest income
    
    
    1.8
    
    
    
    1.7
    
    
    
    1.1Earnings from continuing operations before income taxes
    
    
    13.4
    
    
    
    13.4
    
    
    
    15.4Income tax expense
    
    
    5.2
    
    
    
    5.2
    
    
    
    6.0Net earnings from continuing operations
    
    
    8.2
    
    
    
    8.2
    
    
    
    9.4Discontinued operations:Earnings
from operations of discontinued interests in surgery centers, net of income tax
    
    
    
    
    
    
    0.1
    
    
    
    0.2Gain (loss) on sale of discontinued interests in surgery
centers, net of income tax
    
    
    0.1
    
    
    
    
    
    
    
    (0.3
    )Net earnings (loss) from discontinued operations
    
    
    0.1
    
    
    
    0.1
    
    
    
    (0.1
    )Net earnings
    
    
    8.3
    %
    
    
    8.3
    %
    
    
    9.3
    %
 Year Ended December 31, 2007 Compared to Year Ended December 31, 2006
  
    
    centers acquired and opened in 2007, which generated $40.8 million in revenues;
    
    $19.4 million of revenue growth recognized by our 2007 same-center group, reflecting a
4% increase, primarily as a result of procedure growth; and
    
    centers acquired or opened in 2006, which contributed $14.8 million of additional
revenues due to having a full period of operations in 2007.
  27




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Item 7. Managements Discussion and Analysis of Financial Condition and Results of
Operations  (continued)
   
    
    centers acquired and opened during 2007, which resulted in an increase of $7.5 million
in other operating expenses;
    
    an increase of $7.0 million in other operating expenses at our 2007 same-center group
resulting primarily from additional procedure volume, general inflationary cost increases
as well as a $1.3 million impairment charge and property loss incurred at a center that
will be relocating its facility during 2008; and
    
    centers acquired or opened during 2006, which resulted in an increase of $2.2 million in
other operating expenses.
     Accounting for Uncertainty in Income Taxes  an interpretation of SFAS No. 109
  28




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Item 7. Managements Discussion and Analysis of Financial Condition and Results of
Operations  (continued)
 Year Ended December 31, 2006 Compared to Year Ended December 31, 2005
  
    
    centers acquired or opened in 2005, which contributed $38.2 million of additional
revenues due to having a full period of operations in 2006;
    
    centers acquired and opened in 2006, which generated $20.5 million in revenues; and
    
    $18.7 million of revenue growth by the centers in our 2006 same-center group, reflecting
a 5% increase, primarily as a result of procedure growth.
  Share-Based Payment (Revised 2004)
   
    
    centers acquired or opened during 2005, which resulted in an increase of $7.6 million in
other operating expenses;
    
    an increase of $3.8 million in other operating expenses from our 2006 same-center group
resulting primarily from additional procedure volume and general inflationary cost
increases; and
    
    centers acquired or opened during 2006, which resulted in an increase of $3.8 million in
other operating expenses.
    29




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Item 7. Managements Discussion and Analysis of Financial Condition and Results of
Operations  (continued)
   Liquidity and Capital Resources
  Allowance for Contractual Adjustments and Bad Debt Expense
  
    
    $162.8 million for acquisitions of interests in ASCs;
    
    $18.5 million for new or replacement property at existing surgery centers, including
$746,000 in new capital leases; and
    
    $6.9 million for surgery centers under development.
   30




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Item 7. Managements Discussion and Analysis of Financial Condition and Results of
Operations  (continued)
     31




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Item 7. Managements Discussion and Analysis of Financial Condition and Results of
Operations  (continued)
  Payments Due by PeriodLess than
    
    
    
    
    
    
    
    
    
    More thanTotal
    
    1 Year
    
    1-3 Years
    
    3-5 Years
    
    5 YearsLong-term debt, including
interest (1)
    
    $
    222,410
    
    
    $
    4,817
    
    
    $
    7,262
    
    
    $
    206,065
    
    
    $
    4,266Capital lease obligations,
including interest
    
    
    4,237
    
    
    
    2,172
    
    
    
    1,521
    
    
    
    544
    
    
    
    Operating leases, including renewal
option periods
    
    
    360,015
    
    
    
    26,835
    
    
    
    53,097
    
    
    
    51,265
    
    
    
    228,818Construction in progress
commitments
    
    
    2,542
    
    
    
    2,542
    
    
    
    
    
    
    
    
    
    
    
    Other long-term obligations (2)
    
    
    1,715
    
    
    
    1,715
    
    
    
    
    
    
    
    
    
    
    
    Liability for unrecognized tax
benefits
    
    
    5,969
    
    
    
    
    
    
    
    5,969
    
    
    
    
    
    
    
    Total contractual cash
obligations
    
    $
    596,888
    
    
    $
    38,081
    
    
    $
    67,849
    
    
    $
    257,874
    
    
    $
    233,084
 
 (1)
    
    Our long-term debt may increase based on future acquisition activity. We may use our
operating cash flow to repay existing long-term debt under our credit facility prior to its
maturity date.(2)
    
    Other long-term obligations consist of purchase price commitments that were contingent upon
certain events. These obligations were paid in 2008.   Recent Accounting Pronouncements
 Accounting for Income Taxes.
 Fair Value Measurements
 The Fair Value Option for Financial Assets and
Financial Liabilities.
 32




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Item 7. Managements Discussion and Analysis of Financial Condition and Results of
Operations  (continued)
  Noncontrolling Interests in Consolidated Financial
Statements, an amendment of Accounting Research Bulletin No 51.
 Business Combinations, Business Combinations.
 
 Item 7A. Quantitative and Qualitative Disclosures About Market Risk
  33




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Item 7A. Quantitative and Qualitative Disclosures About Market Risk  (continued)
  FairValue atYears Ended December 31,
    
    
    
    
    
    
    
    
    
    December 31,2008
    
    2009
    
    2010
    
    2011
    
    2012
    
    Thereafter
    
    Total
    
    2007Fixed rate
    
    $
    4,649
    
    
    $
    3,001
    
    
    $
    2,306
    
    
    $
    51,878
    
    
    $
    1,521
    
    
    $
    2,100
    
    
    $
    65,455
    
    
    $
    62,879Average interest
rate
    
    
    7.1
    %
    
    
    6.5
    %
    
    
    6.5
    %
    
    
    5.4
    %
    
    
    6.1
    %
    
    
    6.1
    %Variable rate
    
    $
    1,132
    
    
    $
    1,082
    
    
    $
    859
    
    
    $
    151,860
    
    
    $
    559
    
    
    $
    1,656
    
    
    $
    157,148
    
    
    $
    157,148Average interest
rate
    
    
    6.2
    %
    
    
    6.1
    %
    
    
    6.1
    %
    
    
    6.0
    %
    
    
    6.4
    %
    
    
    6.8
    %
  34




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##### Table of Contents



Item 8. Financial Statements and Supplementary Data
 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
 
    Share Based Payment, Accounting for Uncertainty in Income Taxes  an
Interpretation of SFAS No. 109,
 Internal ControlIntegrated Framework
  
 35




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##### Table of Contents



Item 8.
Financial Statements and Supplementary Data  (continued)
 AmSurg Corp.
Consolidated Balance Sheets
December 31, 2007 and 2006
(Dollars in thousands)
 2007
    
    
    2006AssetsCurrent assets:Cash and cash equivalents
    
    $
    29,953
    
    
    $
    20,083Accounts receivable, net of allowance of $8,310 and $6,628, respectively
    
    
    61,284
    
    
    
    51,546Supplies inventory
    
    
    6,882
    
    
    
    6,183Deferred income taxes (note 8)
    
    
    1,354
    
    
    
    915Prepaid and other current assets
    
    
    18,509
    
    
    
    15,276Total current assets
    
    
    117,982
    
    
    
    94,003Long-term receivables and other assets (note 2)
    
    
    1,653
    
    
    
    4,091Property and equipment, net (notes 3, 5 and 6)
    
    
    104,874
    
    
    
    89,175Intangible assets, net (notes 2 and 4)
    
    
    557,125
    
    
    
    402,763Total assets
    
    $
    781,634
    
    
    $
    590,032Liabilities and Shareholders EquityCurrent liabilities:Current portion of long-term debt (note 5)
    
    $
    5,781
    
    
    $
    3,367Accounts payable
    
    
    12,703
    
    
    
    11,098Accrued salaries and benefits
    
    
    12,415
    
    
    
    11,534Other accrued liabilities
    
    
    2,291
    
    
    
    1,413Income taxes payable
    
    
    1,000
    
    
    
    Total current liabilities
    
    
    34,190
    
    
    
    27,412Long-term debt (notes 2 and 5)
    
    
    216,822
    
    
    
    123,948Deferred income taxes (note 8)
    
    
    41,990
    
    
    
    39,350Other long-term liabilities (note 2 and note 8)
    
    
    15,401
    
    
    
    3,873Commitments and contingencies (notes 2, 5, 6, 9 and 11)Minority interest
    
    
    62,006
    
    
    
    52,341Preferred stock, no par value, 5,000,000 shares authorized, no shares issued or
outstanding (note 7)
    
    
    
    
    
    
    Shareholders equity:Common stock, no par value 70,000,000 shares authorized, 31,202,629 and
29,933,932 shares outstanding, respectively (note 7)
    
    
    172,536
    
    
    
    143,077Deferred compensation
    
    
    (3,916
    )
    
    
    Retained earnings, net of ($634) cumulative adjustment to beginning retained
earnings on January 1, 2007 for change in accounting for uncertainty in
income taxes
    
    
    244,042
    
    
    
    200,501Accumulated other comprehensive loss, net of income taxes (note 5)
    
    
    (1,437
    )
    
    
    (470
    )Total shareholders equity
    
    
    411,225
    
    
    
    343,108Total liabilities and shareholders equity
    
    $
    781,634
    
    
    $
    590,032
  36




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##### Table of Contents



Item 8.
Financial Statements and Supplementary Data  (continued)
 AmSurg Corp.
Consolidated Statements of Earnings
Years Ended December 31, 2007, 2006 and 2005
(In thousands, except earnings per share
 2007
    
    
    2006
    
    
    2005Revenues
    
    $
    531,085
    
    
    $
    455,869
    
    
    $
    378,451Operating expenses:Salaries and benefits (note 9)
    
    
    155,638
    
    
    
    135,521
    
    
    
    107,577Supply cost
    
    
    61,081
    
    
    
    52,445
    
    
    
    41,883Other operating expenses (note 9)
    
    
    108,808
    
    
    
    90,066
    
    
    
    74,886Depreciation and amortization
    
    
    19,493
    
    
    
    17,051
    
    
    
    14,940Total operating expenses
    
    
    345,020
    
    
    
    295,083
    
    
    
    239,286Operating income
    
    
    186,065
    
    
    
    160,786
    
    
    
    139,165Minority interest
    
    
    105,003
    
    
    
    92,001
    
    
    
    76,898Interest expense, net of interest income of $535, $568 and $510,
respectively
    
    
    9,777
    
    
    
    7,665
    
    
    
    4,121Earnings from continuing operations before income taxes
    
    
    71,285
    
    
    
    61,120
    
    
    
    58,146Income tax expense (note 8)
    
    
    27,734
    
    
    
    23,733
    
    
    
    22,794Net earnings from continuing operations
    
    
    43,551
    
    
    
    37,387
    
    
    
    35,352Discontinued operations:Earnings from operations of discontinued interests in surgery centers,
net of income tax expense
    
    
    294
    
    
    
    815
    
    
    
    785Gain (loss) on disposal of discontinued interests in surgery centers,
net of income tax expense (benefit)
    
    
    330
    
    
    
    (463
    )
    
    
    (986
    )Net earnings (loss) from discontinued operations
    
    
    624
    
    
    
    352
    
    
    
    (201
    )Net earnings
    
    $
    44,175
    
    
    $
    37,739
    
    
    $
    35,151Basic earnings per common share (note 7):Net earnings from continuing operations
    
    $
    1.42
    
    
    $
    1.25
    
    
    $
    1.20Net earnings
    
    $
    1.44
    
    
    $
    1.27
    
    
    $
    1.19Diluted earnings per common share:Net earnings from continuing operations
    
    $
    1.40
    
    
    $
    1.23
    
    
    $
    1.17Net earnings
    
    $
    1.42
    
    
    $
    1.24
    
    
    $
    1.17Weighted average number of shares and share equivalents
outstanding (note 7):Basic
    
    
    30,619
    
    
    
    29,822
    
    
    
    29,573Diluted
    
    
    31,102
    
    
    
    30,398
    
    
    
    30,147
  37




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##### Table of Contents



Item 8. Financial Statements and Supplementary Data  (continued)
 AmSurg Corp.
Consolidated Statements of Changes in Shareholders Equity
Years Ended December 31, 2007, 2006 and 2005
(In thousands
 AccumulatedOtherCommon Stock
    
    Deferred
    
    Retained
    
    ComprehensiveShares
    
    Amount
    
    Compensation
    
    Earnings
    
    Loss
    
    TotalBalance at December 31, 2004
    
    
    29,420
    
    
    $
    126,538
    
    
    $
    
    
    
    $
    127,611
    
    
    $
    
    
    
    $
    254,149Issuance of common stock
    
    
    4
    
    
    
    83
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    83Stock options exercised
    
    
    265
    
    
    
    4,060
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,060Tax benefit related to
exercise of stock options
    
    
    
    
    
    
    1,175
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,175Net earnings and
comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    35,151
    
    
    
    
    
    
    
    35,151Balance at December 31, 2005
    
    
    29,689
    
    
    
    131,856
    
    
    
    
    
    
    
    162,762
    
    
    
    
    
    
    
    294,618Issuance of common stock
    
    
    3
    
    
    
    87
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    87Stock options exercised
    
    
    242
    
    
    
    3,048
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,048Share-based compensation
    
    
    
    
    
    
    7,030
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    7,030Tax benefit related to
exercise of stock options
    
    
    
    
    
    
    1,056
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,056Comprehensive income:Net earnings
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    37,739
    
    
    
    
    
    
    
    37,739Loss on interest rate
swap, net of income tax
benefit
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (470
    )
    
    
    (470
    )Total comprehensive
income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    37,269Balance at December 31, 2006
    
    
    29,934
    
    
    
    143,077
    
    
    
    
    
    
    
    200,501
    
    
    
    (470
    )
    
    
    343,108Cumulative adjustment to
beginning retained earnings
on January 1, 2007
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (634
    )
    
    
    
    
    
    
    (634
    )Issuance of restricted
common stock
    
    
    200
    
    
    
    4,616
    
    
    
    (4,616
    )
    
    
    
    
    
    
    
    
    
    
    Deferred compensation
amortization
    
    
    
    
    
    
    
    
    
    
    576
    
    
    
    
    
    
    
    
    
    
    
    576Cancellation of restricted
common stock
    
    
    (5
    )
    
    
    (124
    )
    
    
    124
    
    
    
    
    
    
    
    
    
    
    
    Stock options exercised
    
    
    1,074
    
    
    
    17,661
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    17,661Share-based compensation
    
    
    
    
    
    
    3,984
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,984Tax benefit related to
exercise of stock options
    
    
    
    
    
    
    3,322
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,322Comprehensive income:Net earnings
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    44,175
    
    
    
    
    
    
    
    44,175Loss on interest rate
swap, net of income tax benefit
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (967
    )
    
    
    (967
    )Total comprehensive
income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    43,208Balance at December 31, 2007
    
    
    31,203
    
    
    $
    172,536
    
    
    $
    (3,916
    )
    
    $
    244,042
    
    
    $
    (1,437
    )
    
    $
    411,225
  38




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##### Table of Contents



Item 8. Financial Statements and Supplementary Data  (continued)
 AmSurg Corp.
Consolidated Statements of Cash Flows
Years Ended December 31, 2007, 2006 and 2005
(In thousands
 2007
    
    
    2006
    
    
    2005Cash flows from operating activities:Net earnings
    
    $
    44,175
    
    
    $
    37,739
    
    
    $
    35,151Adjustments to reconcile net earnings to net cash provided by
operating activities:Minority interest
    
    
    105,003
    
    
    
    92,001
    
    
    
    76,898Distributions to minority partners
    
    
    (103,545
    )
    
    
    (90,668
    )
    
    
    (75,639
    )Depreciation and amortization
    
    
    19,493
    
    
    
    17,051
    
    
    
    14,940Net loss on sale and impairment of long-lived assets
    
    
    724
    
    
    
    92
    
    
    
    1,621Share-based compensation
    
    
    4,560
    
    
    
    7,030
    
    
    
    Excess tax benefit from share-based compensation
    
    
    (3,322
    )
    
    
    (1,070
    )
    
    
    Deferred income taxes
    
    
    8,063
    
    
    
    5,918
    
    
    
    7,540Increase (decrease) in cash and cash equivalents, net of effects of
acquisitions and dispositions, due to changes in:Accounts receivable, net
    
    
    (2,300
    )
    
    
    (1,939
    )
    
    
    (4,460
    )Supplies inventory
    
    
    47
    
    
    
    (391
    )
    
    
    (438
    )Prepaid and other current assets
    
    
    (2,958
    )
    
    
    (383
    )
    
    
    1,284Accounts payable
    
    
    962
    
    
    
    1,382
    
    
    
    1,923Accrued expenses and other liabilities
    
    
    8,128
    
    
    
    4,040
    
    
    
    2,948Other, net
    
    
    341
    
    
    
    1,219
    
    
    
    1,653Net cash flows provided by operating activities
    
    
    79,371
    
    
    
    72,021
    
    
    
    63,421Cash flows from investing activities:Acquisition of interest in surgery centers
    
    
    (162,777
    )
    
    
    (57,029
    )
    
    
    (66,079
    )Acquisition of property and equipment
    
    
    (24,640
    )
    
    
    (18,468
    )
    
    
    (22,777
    )Proceeds from sale of interests in surgery centers
    
    
    5,433
    
    
    
    1,076
    
    
    
    2,400Net repayment of long-term receivables
    
    
    2,616
    
    
    
    2,627
    
    
    
    3,148Net cash flows used in investing activities
    
    
    (179,368
    )
    
    
    (71,794
    )
    
    
    (83,308
    )Cash flows from financing activities:Proceeds from long-term borrowings
    
    
    178,316
    
    
    
    98,855
    
    
    
    108,179Repayment on long-term borrowings
    
    
    (89,712
    )
    
    
    (103,370
    )
    
    
    (87,726
    )Net proceeds from issuance of common stock
    
    
    17,661
    
    
    
    3,048
    
    
    
    4,060Proceeds from capital contributions by minority partners
    
    
    480
    
    
    
    177
    
    
    
    1,322Excess tax benefit from share-based compensation
    
    
    3,322
    
    
    
    1,070
    
    
    
    Financing cost incurred
    
    
    (200
    )
    
    
    (420
    )
    
    
    (444
    )Net cash flows provided by (used in) financing activities
    
    
    109,867
    
    
    
    (640
    )
    
    
    25,391Net increase (decrease) in cash and cash equivalents
    
    
    9,870
    
    
    
    (413
    )
    
    
    5,504Cash and cash equivalents, beginning of year
    
    
    20,083
    
    
    
    20,496
    
    
    
    14,992Cash and cash equivalents, end of year
    
    $
    29,953
    
    
    $
    20,083
    
    
    $
    20,496
  39




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##### Table of Contents



Item 8. Financial Statements and Supplementary Data  (continued)
 AmSurg Corp.
Notes to the Consolidated Financial Statements
 1. Summary of Significant Accounting Policies
 a. Principles of Consolidation
     b. Cash and Cash Equivalents
  c. Supplies Inventory
  d. Prepaid and Other Current Assets
  40




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##### Table of Contents



Item 8. Financial Statements and Supplementary Data  (continued)
 AmSurg Corp.
Notes to the Consolidated Financial Statements  (continued)
  e. Property and Equipment, net
  f. Intangible Assets
 Goodwill
 Goodwill and Other Intangible Assets,
 Other Intangible Assets
  g. Other Long-Term Liabilities
  h. Revenue Recognition
   41




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##### Table of Contents



Item 8. Financial Statements and Supplementary Data  (continued)
 AmSurg Corp.
Notes to the Consolidated Financial Statements  (continued)
 i. Operating Expenses
  j. Income Taxes
  Accounting for Uncertainty in
Income Taxes  an interpretation of SFAS No. 109, Accounting for
Income Taxes.
  k. Earnings Per Share
  l. Fair Value of Financial Instruments
  42




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##### Table of Contents



Item 8. Financial Statements and Supplementary Data  (continued)
 AmSurg Corp.
Notes to the Consolidated Financial Statements  (continued)
 m. Share-Based Compensation
 Share-Based Payment (Revised 2004). Accounting for
Stock Issued to Employees,
 Accounting for Stock-Based Compensation, Transition Election to Accounting for Tax Effects of
Share-Based Payment Awards.
    n. Use of Estimates
   43




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##### Table of Contents



Item 8. Financial Statements and Supplementary Data  (continued)
 AmSurg Corp.
Notes to the Consolidated Financial Statements  (continued)
  o. Recent Accounting Pronouncements
 Fair Value Measurements
 The Fair Value Option for Financial Assets and
Financial Liabilities.
 Noncontrolling Interests in Consolidated Financial
Statements, an amendment of Accounting Research Bulletin No 51.
 Business Combinations Business Combinations.
 p. Reclassifications and Restatements
  44




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##### Table of Contents



Item 8. Financial Statements and Supplementary Data  (continued)
 AmSurg Corp.
Notes to the Consolidated Financial Statements  (continued)
 2. Acquisitions and Dispositions
 a. Acquisitions
   b. Pro Forma Information
  2007
    
    
    2006Revenues
    
    $
    581,100
    
    
    $
    552,938Net earnings from continuing operations
    
    
    47,360
    
    
    
    44,479Net earnings
    
    
    47,984
    
    
    
    44,831Net earnings from continuing operations per common share:Basic
    
    $
    1.55
    
    
    $
    1.49Diluted
    
    $
    1.52
    
    
    $
    1.46Net earnings per common share:Basic
    
    $
    1.57
    
    
    $
    1.50Diluted
    
    $
    1.54
    
    
    $
    1.47Weighted average number of shares and share equivalents:Basic
    
    
    30,619
    
    
    
    29,822Diluted
    
    
    31,102
    
    
    
    30,398
 c. Dispositions
 
 45




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##### Table of Contents



Item 8. Financial Statements and Supplementary Data  (continued)
 AmSurg Corp.
Notes to the Consolidated Financial Statements  (continued)
  2007
    
    
    2006
    
    
    2005Revenues
    
    $
    6,362
    
    
    $
    11,736
    
    
    $
    15,673Earnings before income taxes
    
    
    574
    
    
    
    1,333
    
    
    
    1,290Net earnings
    
    
    294
    
    
    
    815
    
    
    
    785
 3. Property and Equipment
  2007
    
    
    2006Land and improvements
    
    $
    164
    
    
    $
    450Building and improvements
    
    
    83,745
    
    
    
    70,782Movable equipment
    
    
    115,944
    
    
    
    100,000Construction in progress
    
    
    3,431
    
    
    
    1,724203,284
    
    
    
    172,956Less accumulated depreciation
    
    
    98,410
    
    
    
    83,781Property and equipment, net
    
    $
    104,874
    
    
    $
    89,175
  4. Intangible Assets
  2007
    
    2006Gross
    
    
    
    
    
    
    
    
    
    GrossCarrying
    
    Accumulated
    
    
    
    
    
    Carrying
    
    AccumulatedAmount
    
    Amortization
    
    Net
    
    Amount
    
    Amortization
    
    NetDeferred financing cost
    
    $
    2,703
    
    
    
    ($1,738
    )
    
    $
    965
    
    
    $
    2,503
    
    
    
    ($1,503
    )
    
    $
    1,000Customer and non-compete
agreements
    
    
    3,180
    
    
    
    (1,218
    )
    
    
    1,962
    
    
    
    1,000
    
    
    
    (1,000
    )
    
    
    Total amortizable
intangible assets
    
    $
    5,883
    
    
    
    ($2,956
    )
    
    $
    2,927
    
    
    $
    3,503
    
    
    
    ($2,503
    )
    
    $
    1,000
  46




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##### Table of Contents



Item 8. Financial Statements and Supplementary Data  (continued)
 AmSurg Corp.
Notes to the Consolidated Financial Statements  (continued)
  2007
    
    
    2006Balance, beginning of year
    
    $
    397,147
    
    
    $
    347,424Goodwill acquired during year
    
    
    153,399
    
    
    
    50,445Goodwill disposed of during year
    
    
    (3,631
    )
    
    
    (722
    )Balance, end of year
    
    $
    546,915
    
    
    $
    397,147
  5. Long-term Debt
  2007
    
    
    2006$300 million credit agreement at prime, or LIBOR plus 0.50% to 1.50%, or a
combination thereof (average rate of 5.77% at December 31, 2007),
due July 2011
    
    $
    201,000
    
    
    $
    114,000Other debt at an average rate of 6.17%, due through 2023
    
    
    17,786
    
    
    
    11,888Capitalized lease arrangements at an average rate of 8.08%, due through 2012
(see note 6)
    
    
    3,817
    
    
    
    1,427222,603
    
    
    
    127,315Less current portion
    
    
    5,781
    
    
    
    3,367Long-term debt
    
    $
    216,822
    
    
    $
    123,948
     47




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##### Table of Contents



Item 8. Financial Statements and Supplementary Data  (continued)
 AmSurg Corp.
Notes to the Consolidated Financial Statements  (continued)
 Accounting for
Derivative Investments and Hedging Activities,
 6. Leases
  CapitalizedYear Ended
    
    Equipment
    
    
    OperatingDecember 31,
    
    Leases
    
    
    Leases2008
    
    $
    2,172
    
    
    $
    26,8352009
    
    
    921
    
    
    
    26,8842010
    
    
    600
    
    
    
    26,2132011
    
    
    389
    
    
    
    25,8752012
    
    
    155
    
    
    
    25,390Thereafter
    
    
    
    
    
    
    228,818Total minimum rentals
    
    
    4,237
    
    
    $
    360,015Less amounts representing interest at rates ranging from 4.5% to 12.3%
    
    
    420Capital lease obligations
    
    $
    3,817
  7. Shareholders Equity
 a. Shareholder Rights Plan
  48




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##### Table of Contents



Item 8. Financial Statements and Supplementary Data  (continued)
 AmSurg Corp.
Notes to the Consolidated Financial Statements  (continued)
 b. Earnings per Share
  Earnings
    
    Shares
    
    Per Share(Numerator)
    
    (Denominator)
    
    AmountFor the year ended December 31, 2007:Net earnings from continuing operations per share (basic):
    
    $
    43,551
    
    
    
    30,619
    
    
    $
    1.42Effect of dilutive securities options
    
    
    
    
    
    
    483Net earnings from continuing operations (diluted)
    
    $
    43,551
    
    
    
    31,102
    
    
    $
    1.40Net earnings per common share (basic):
    
    $
    44,175
    
    
    
    30,619
    
    
    $
    1.44Effect of dilutive securities options
    
    
    
    
    
    
    483Net earnings per common share (diluted)
    
    $
    44,175
    
    
    
    31,102
    
    
    $
    1.42For the year ended December 31, 2006:Net earnings from continuing operations per share (basic):
    
    $
    37,387
    
    
    
    29,822
    
    
    $
    1.25Effect of dilutive securities options
    
    
    
    
    
    
    576Net earnings from continuing operations (diluted)
    
    $
    37,387
    
    
    
    30,398
    
    
    $
    1.23Net earnings per common share (basic):
    
    $
    37,739
    
    
    
    29,822
    
    
    $
    1.27Effect of dilutive securities options
    
    
    
    
    
    
    576Net earnings per common share (diluted)
    
    $
    37,739
    
    
    
    30,398
    
    
    $
    1.24For the year ended December 31, 2005:Net earnings from continuing operations per share (basic):
    
    $
    35,352
    
    
    
    29,573
    
    
    $
    1.20Effect of dilutive securities options
    
    
    
    
    
    
    574Net earnings from continuing operations (diluted)
    
    $
    35,352
    
    
    
    30,147
    
    
    $
    1.17Net earnings per common share (basic):
    
    $
    35,151
    
    
    
    29,573
    
    
    $
    1.19Effect of dilutive securities options
    
    
    
    
    
    
    574Net earnings per common share (diluted)
    
    $
    35,151
    
    
    
    30,147
    
    
    $
    1.17
 c. Stock Incentive Plans
  49




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##### Table of Contents



Item 8. Financial Statements and Supplementary Data  (continued)
 AmSurg Corp.
Notes to the Consolidated Financial Statements  (continued)
    WeightedNumber
    
    Averageof
    
    ExerciseShares
    
    PriceNon-vested shares at January 1, 2007
    
    
    3,262
    
    
    $
    26.19Shares granted
    
    
    199,795
    
    
    
    23.11Shares vested
    
    
    (3,626
    )
    
    
    25.27Shares forfeited
    
    
    (5,432
    )
    
    
    22.84Non-vested shares at December 31, 2007
    
    
    193,999
    
    
    $
    23.13
 50




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##### Table of Contents



Item 8. Financial Statements and Supplementary Data  (continued)
 AmSurg Corp.
Notes to the Consolidated Financial Statements  (continued)
  WeightedWeighted
    
    AverageNumber
    
    Average
    
    Remainingof
    
    Exercise
    
    ContractualShares
    
    Price
    
    Term (in years)Outstanding at December 31, 2004
    
    
    3,274,628
    
    
    $
    17.68
    
    
    
    7.8Options granted
    
    
    1,038,353
    
    
    
    25.94Options exercised with
total intrinsic value of
$2,997,000
    
    
    (265,216
    )
    
    
    15.31Options terminated
    
    
    (209,584
    )
    
    
    22.31Outstanding at December 31, 2005
    
    
    3,838,181
    
    
    
    19.82
    
    
    
    7.4Options granted
    
    
    1,171,532
    
    
    
    21.50Options exercised with
total intrinsic value of
$2,926,000
    
    
    (241,883
    )
    
    
    12.64Options terminated
    
    
    (178,298
    )
    
    
    24.09Outstanding at December 31, 2006
    
    
    4,589,532
    
    
    
    20.46
    
    
    
    7.1Options granted
    
    
    385,293
    
    
    
    22.84Options exercised with
total intrinsic value of
$7,639,000
    
    
    (1,074,334
    )
    
    
    16.44Options terminated
    
    
    (226,017
    )
    
    
    23.22Outstanding at December 31,
2007 with aggregate intrinsic
value of $19,731,000
    
    
    3,674,474
    
    
    $
    21.72
    
    
    
    6.7Vest or expected to vest at
December 31, 2007 with total
intrinsic value of $19,297,000
    
    
    3,564,240
    
    
    $
    21.65
    
    
    
    6.6Exercisable at December 31,
2007 with total intrinsic value
of $13,995,000
    
    
    2,217,347
    
    
    $
    20.77
    
    
    
    5.8
  51




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##### Table of Contents



Item 8. Financial Statements and Supplementary Data  (continued)
 AmSurg Corp.  Notes to the Consolidated Financial Statements  (continued)
  2007
    
    2006
    
    2005Applied assumptions:Weighted average fair value of options at the date of grant
    
    $
    8.62
    
    
    $
    7.61
    
    
    $
    5.40Dividends
    
    
    
    
    
    
    
    
    
    
    Expected term/life of options in years
    
    
    4.9
    
    
    
    4
    
    
    
    4Forfeiture rate for options
    
    
    0.1
    %
    
    
    11.4
    %
    
    
    15.0
    %Forfeiture rate for restricted stock
    
    
    3.0
    %
    
    
    
    
    
    
    Average risk-free interest rate
    
    
    4.7
    %
    
    
    4.6
    %
    
    
    3.8
    %Volatility rate
    
    
    34.2
    %
    
    
    37.6
    %
    
    
    34.5
    %
 Pro Forma2005Net earnings from continuing operations:As reported
    
    $
    35,352Deduct: Total share-based employee compensation expense determined under fair value based method for all
awards, net of related tax effects
    
    
    (3,218
    )Pro forma
    
    $
    32,134Net earnings:As reported
    
    $
    35,151Deduct: Total share-based employee compensation expense determined under fair value based method for all
awards, net of related tax effects
    
    
    (3,218
    )Pro forma
    
    $
    31,933Net earnings from continuing operations per common share:Basic as reported
    
    $
    1.20Basic pro forma
    
    $
    1.09Diluted as reported
    
    $
    1.17Diluted pro forma
    
    $
    1.07Net earnings per common share:Basic as reported
    
    $
    1.19Basic pro forma
    
    $
    1.08Diluted as reported
    
    $
    1.17Diluted pro forma
    
    $
    1.06
 52




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##### Table of Contents



Item 8. Financial Statements and Supplementary Data  (continued)
 AmSurg Corp.  Notes to the Consolidated Financial Statements  (continued)
 8. Income Taxes
  Balance at January 1, 2007
    
    $
    4,868Additions for tax positions of current year
    
    
    701Balance at December 31, 2007
    
    $
    5,569
      2007
    
    
    2006
    
    
    2005Income from continuing operations
    
    $
    27,734
    
    
    $
    23,733
    
    
    $
    22,794Discontinued operations
    
    
    403
    
    
    
    890
    
    
    
    (130
    )Shareholders equity
    
    
    (3,945
    )
    
    
    (1,359
    )
    
    
    (1,175
    )Total
    
    $
    24,192
    
    
    $
    23,264
    
    
    $
    21,489
  2007
    
    
    2006
    
    
    2005Current:Federal
    
    $
    15,443
    
    
    $
    15,721
    
    
    $
    13,260State
    
    
    3,076
    
    
    
    3,220
    
    
    
    3,097Deferred
    
    
    9,215
    
    
    
    4,792
    
    
    
    6,437Income tax expense
    
    $
    27,734
    
    
    $
    23,733
    
    
    $
    22,794
 53




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##### Table of Contents



Item 8. Financial Statements and Supplementary Data  (continued)
 AmSurg Corp.  Notes to the Consolidated Financial Statements  (continued)
  2007
    
    
    2006
    
    
    2005Statutory federal income tax
    
    $
    24,950
    
    
    $
    21,392
    
    
    $
    20,351State income taxes, net of federal income tax benefit
    
    
    2,796
    
    
    
    2,586
    
    
    
    2,980(Decrease) increase in valuation allowances
    
    
    (326
    )
    
    
    61
    
    
    
    101Interest related to unrecognized tax benefits under FIN No. 48
    
    
    224
    
    
    
    
    
    
    
    Other
    
    
    90
    
    
    
    (306
    )
    
    
    (638
    )Income tax expense
    
    $
    27,734
    
    
    $
    23,733
    
    
    $
    22,794
  2007
    
    
    2006Deferred tax assets:Allowance for uncollectible accounts
    
    $
    1,094
    
    
    $
    960Accrued liabilities and other
    
    
    748
    
    
    
    565State net operating loss
    
    
    146
    
    
    
    Valuation allowances
    
    
    (170
    )
    
    
    (211
    )Total current deferred tax assets
    
    
    1,818
    
    
    
    1,314Share-based compensation
    
    
    4,195
    
    
    
    2,665Benefit of interest under FIN No. 48
    
    
    615
    
    
    
    Accrued liabilities and other
    
    
    1,997
    
    
    
    1,204Property equipment, principally due to difference in depreciation
    
    
    652
    
    
    
    Operating and capital loss carryforwards
    
    
    838
    
    
    
    1,348Valuation allowances
    
    
    (668
    )
    
    
    (954
    )Total non-current deferred tax assets
    
    
    7,629
    
    
    
    4,263Total deferred tax assets
    
    
    9,447
    
    
    
    5,577Deferred tax liabilities:Prepaid expenses
    
    
    464
    
    
    
    398Property and equipment, principally due to difference in depreciation
    
    
    
    
    
    
    190Goodwill, principally due to differences in amortization
    
    
    49,619
    
    
    
    43,424Total deferred tax liabilities
    
    
    50,083
    
    
    
    44,012Net deferred tax liabilities
    
    $
    40,636
    
    
    $
    38,435
 54




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##### Table of Contents



Item 8. Financial Statements and Supplementary Data  (continued)
 AmSurg Corp.  Notes to the Consolidated Financial Statements  (continued)
  2007
    
    
    2006Current deferred income tax assets
    
    $
    1,354
    
    
    $
    915Non-current deferred income tax liabilities
    
    
    41,990
    
    
    
    39,350Net deferred tax liabilities
    
    $
    40,636
    
    
    $
    38,435
  9. Related Party Transactions
     10. Employee Benefit Programs
   11. Commitments and Contingencies
  55




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##### Table of Contents



Item 8. Financial Statements and Supplementary Data  (continued)
 AmSurg Corp.  Notes to the Consolidated Financial Statements  (continued)
   12. Supplemental Cash Flow Information
  2007
    
    
    2006
    
    
    2005Cash paid during the year for:Interest
    
    $
    9,961
    
    
    $
    8,371
    
    
    $
    4,739Income taxes, net of refunds
    
    
    14,906
    
    
    
    17,462
    
    
    
    12,075Non-cash investing and financing activities:Capital lease obligations incurred to acquire equipment
    
    
    746
    
    
    
    800
    
    
    
    276Notes received for sale of a partnership interest
    
    
    
    
    
    
    108
    
    
    
    Effect of acquisitions:Assets acquired, net of cash
    
    
    178,882
    
    
    
    62,723
    
    
    
    90,195Liabilities assumed
    
    
    (16,105
    )
    
    
    (5,694
    )
    
    
    (6,609
    )Notes payable and other obligations
    
    
    
    
    
    
    
    
    
    
    (17,507
    )Payment for assets acquired
    
    $
    162,777
    
    
    $
    57,029
    
    
    $
    66,079
 13. Subsequent Events
  56




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##### Table of Contents



Item 8. Financial Statements and Supplementary Data  (continued)
 Quarterly Statement of Earnings Data (Unaudited)
  2006
    
    2007Q1
    
    Q2
    
    Q3
    
    Q4
    
    Q1
    
    Q2
    
    Q3
    
    Q4(In thousands, except per share data)Revenues
    
    $
    110,320
    
    
    $
    116,545
    
    
    $
    112,161
    
    
    $
    116,843
    
    
    $
    125,545
    
    
    $
    130,145
    
    
    $
    130,940
    
    
    $
    144,455Earnings from
continuing
operations before
income taxes
    
    
    13,965
    
    
    
    16,222
    
    
    
    15,235
    
    
    
    15,698
    
    
    
    16,757
    
    
    
    17,447
    
    
    
    17,666
    
    
    
    19,415Net earnings from
continuing
operations
    
    
    8,491
    
    
    
    9,863
    
    
    
    9,263
    
    
    
    9,770
    
    
    
    10,098
    
    
    
    10,910
    
    
    
    10,808
    
    
    
    11,735Net (loss) earnings
from discontinued
operations
    
    
    234
    
    
    
    241
    
    
    
    99
    
    
    
    (222
    )
    
    
    179
    
    
    
    282
    
    
    
    (818
    )
    
    
    981Net earnings
    
    
    8,725
    
    
    
    10,104
    
    
    
    9,362
    
    
    
    9,548
    
    
    
    10,277
    
    
    
    11,192
    
    
    
    9,990
    
    
    
    12,716Diluted net
earnings from
continuing
operations per
common share
    
    $
    0.28
    
    
    $
    0.32
    
    
    $
    0.30
    
    
    $
    0.32
    
    
    $
    0.33
    
    
    $
    0.35
    
    
    $
    0.35
    
    
    $
    0.37Diluted net
earnings per common
share
    
    $
    0.29
    
    
    $
    0.33
    
    
    $
    0.31
    
    
    $
    0.31
    
    
    $
    0.34
    
    
    $
    0.36
    
    
    $
    0.32
    
    
    $
    0.40
 57




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##### Table of Contents



Item 9.

    Changes in and Disagreements with Accountants on Accounting and Financial
Disclosure
  
 Item 9A.

    Controls and Procedures
 Managements Report on Internal Control Over Financial Reporting
    Internal Control  Integrated Framework
 /s/ Christopher A. Holden

Christopher A. HoldenPresident and Chief Executive Officer
 /s/ Claire M. Gulmi

Claire M. GulmiExecutive Vice President and Chief Financial Officer
 58




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##### Table of Contents



Item 9A. Controls and Procedures  (continued)
 Report of Independent Registered Public Accounting Firm
 
 Internal Control  Integrated
Framework
    Internal Control
 Integrated Framework
 Share Based Payment Accounting
for Uncertainty in Income Taxes  an Interpretation of SFAS No. 109
  
 59




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##### Table of Contents



Item 9A. Controls and Procedures  (continued)
 Evaluation of Disclosure Controls and Procedures
  Changes in Internal Control Over Financial Reporting
  
 Item 9B. Other Information
  
 Part III
 
 Item 10.

    Directors, Executive Officers and Corporate Governance
     
 Item 11.

    Executive Compensation
  
 Item 12.

    Security Ownership of Certain Beneficial Owners and Management and Related Stockholder
Matters
  60




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##### Table of Contents



Item 13. Certain Relationships and Related Transactions, and Director Independence
   
 Item 14. Principal Accounting Fees and Services
  
 Part IV
 
 Item 15. Exhibits and Financial Statement Schedules
  (1)
    
    Financial Statements: See Item 8 herein.(2
    )
    
    Financial Statement Schedules:Report of Registered Public Accounting Firm
    
    S-1Schedule II  Valuation and Qualifying Accounts
    
    S-2(All other schedules are omitted because they are not applicable or
not required, or because the required information is included in the
consolidated financial statements or notes thereto.)(3)
    
    Exhibits: See the exhibit listing set forth below.
 61




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##### Table of Contents



(3) Exhibits
 Exhibit
    
    
    
    Description3.1
    
    
    
    Second Amended and Restated Charter of AmSurg, as amended
(incorporated by reference to Exhibit 4.2 to the Quarterly
Report on Form 10-Q for the quarter ended June 30, 2004)3.2
    
    
    
    Second Amended and Restated Bylaws of AmSurg, as amended
(incorporated by reference to Exhibit 4.3 to the Quarterly
Report on Form 10-Q for the quarter ended June 30, 2004)4.1
    
    
    
    Specimen common stock certificate (incorporated by
reference to Exhibit 4.1 to the Registration Statement on
Form 10/A-4 (filed with the Commission on July 13, 2001))4.2
    
    
    
    Second Amended and Restated Rights Agreement, dated as of
July 12, 2001, between AmSurg and SunTrust Bank, Atlanta,
including the Form of Rights Certificate (Exhibit A) and
the Form of Summary of Rights (Exhibit B) (incorporated by
reference to Exhibit 1 to Amendment No. 2 to the
Registration Statement on Form 8-A/A (filed with the
Commission on July 13, 2001))4.3
    
    
    
    First Amendment to Second Amended and Restated Rights
Agreement, dated as of April 16, 2003, by and between
AmSurg and SunTrust Bank, Atlanta (incorporated by
reference to Exhibit 4 of the Quarterly Report on Form 10-Q
for the quarter ended June 30, 2003)10.1
    
    *
    
    Form of Indemnification Agreement with directors, executive
officers and advisors (incorporated by reference to Exhibit
10.3 to the Registration Statement on Form 10 (filed with
the Commission on March 11, 1997))10.2
    
    
    
    Third Amended and Restated Revolving Credit Agreement,
dated as of July 28, 2006, among AmSurg, SunTrust Bank, as
Administrative Agent, and various banks and other financial
institutions (incorporated by reference to Exhibit 99.1 of
the Current Report on Form 8-K, dated August 1, 2006)10.3
    
    
    
    First Amendment to Third Amended and Restated Revolving
Credit Agreement, dated as of October 29, 2007, by and
among AmSurg Corp., the several banks and other financial
institutions from time to time party thereto (the
Lenders), and SunTrust Bank, in its capacity as
Administrative Agent for the Lenders (incorporated by
reference to Exhibit 10.1 of the Current Report on Form
8-K, dated November 2, 2007)10.4
    
    *
    
    Amended and Restated 1997 Stock Incentive Plan, as amended
(incorporated by reference to Exhibit 4.1 to the Quarterly
Report on Form 10-Q for the quarter ended June 30, 2004)10.5
    
    *
    
    First Amendment to Amended and Restated 1997 Stock
Incentive Plan (incorporated by reference to the Current
Report on Form 8-K, dated November 21, 2006)10.6
    
    *
    
    Form of Non-Qualified Stock Option Agreement  1997
Incentive Plan (incorporated by reference to Exhibit 99.1
to the Current Report on Form 8-K, dated February 2, 2005)10.7
    
    *
    
    Form of Restricted Stock Agreement for Non-Employee
Directors  1997 Incentive Plan (incorporated by reference
to Exhibit 10.1 to the Current Report on Form 8-K, dated
May 24, 2005)10.8
    
    *
    
    Agreement dated April 11, 1997 between AmSurg and David L.
Manning (incorporated by reference to Exhibit 10.12 to the
Registration Statement on Form 10/A-3 (filed with the
Commission on November 3, 1997))10.9
    
    *
    
    Medical Director Agreement dated as of January 1, 1998,
between AmSurg and Bergein F. Overholt, M.D. (incorporated
by reference to Exhibit 10 of the Quarterly Report on Form
10-Q for the quarter ended September 30, 1998)
 62




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##### Table of Contents



(3) Exhibits
 (continued)
 Exhibit
    
    
    
    Description10.10
    
    
    
    Lease Agreement dated February 24, 1999 between Burton Hills
III, L.L.C. and AmSurg (incorporated by reference to Exhibit
10.1 of the Quarterly Report on Form 10-Q for the quarter
ended June 30, 1999)10.11
    
    
    
    First Amendment to Lease Agreement dated June 27, 2001 by
and between Burton Hills III, LLC and AmSurg (incorporated
by reference to Exhibit 10 of the Quarterly Report on Form
10-Q for the quarter ended September 30, 2002)10.12
    
    
    
    Second Amendment to Lease Agreement dated January 31, 2003
by and between Burton Hills III Partnership and AmSurg
(incorporated by reference to Exhibit 10.14 to the Annual
Report on Form 10-K for the year ended December 31, 2003)10.13
    
    
    
    Third Amendment to Lease Agreement dated September 1, 2003
by and between Burton Hills III Partnership and AmSurg
(incorporated by reference to Exhibit 10.15 to the Annual
Report on Form 10-K for the year ended December 31, 2003)10.14
    
    
    
    Fourth Amendment to Lease Agreement dated October 31, 2003
by and between Burton Hills III Partnership and AmSurg
(incorporated by reference to Exhibit 10.16 to the Annual
Report on Form 10-K for the year ended December 31, 2003)10.15
    
    *
    
    Amended and Restated Supplemental Executive Retirement
Savings Plan (incorporated by reference to Exhibit 99.1 of
the Current Report on Form 8-K, dated February 13, 2008)10.16
    
    *
    
    AmSurg Corp. 2006 Stock Incentive Plan, as amended
(incorporated by reference to Exhibit 99 to the Current
Report onForm 8-K, dated May 23, 2007)10.17
    
    *
    
    Form of Restricted Share Award Agreement for Non-Employee
Directors  2006 Incentive Plan (incorporated by reference
to Exhibit 99.3 to the Current Report on Form 8-K, dated
February 21, 2007)10.18
    
    *
    
    Form of Non-Qualified Stock Option Agreement for Executive
Officers  2006 Incentive Plan (incorporated by reference
to Exhibit 99.1 to the Current Report on Form 8-K, dated
February 21, 2007)10.19
    
    *
    
    Form of Restricted Share Award for Employees  2006
Incentive Plan (incorporated by reference to Exhibit 99.2 to
the Current Report on Form 8-K, dated February 1, 2007)10.20
    
    *
    
    Restricted Share Award Agreement, dated February 21, 2008,
between the Company and Ken P. McDonald10.21
    
    *
    
    Non-Qualified Stock Option Agreement, dated February 21,
2008, between the Company and Ken P. McDonald10.22
    
    *
    
    AmSurg Corp. Long-Term Care Plan (incorporated by reference
to Exhibit 10.2 to the Quarterly Report on Form 10-Q for the
quarter ended June 30, 2005)10.23
    
    *
    
    Form of Employment Agreement with executive officers
(incorporated by reference to Exhibit 10.9 to the
Registration Statement on Form 10 (filed with the Commission
on March 11, 1997))10.24
    
    *
    
    First Amendment to Employment Agreement, dated November 22,
2005, between AmSurg and Ken P. McDonald (incorporated by
reference to Exhibit 99 to the Current Report on Form 8-K,
dated November 22, 2005)
 63




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##### Table of Contents



(3) Exhibits
 (continued)
 Exhibit
    
    
    
    Description10.25
    
    *
    
    Employment Agreement, dated October 1, 2007, between AmSurg and
Christopher A. Holden (incorporated by reference to Exhibit 99 to the
Current Report on Form 8-K, dated October 5, 2007)10.26
    
    *
    
    Amended and Restated Employment Agreement, dated February 7, 2008,
between AmSurg and Claire M. Gulmi (incorporated by reference to Exhibit
99.2 to the Current Report on Form 8-K, dated February 13, 2008)10.27
    
    *
    
    Amended and Restated Employment Agreement, dated February 7, 2008,
between AmSurg and David L. Manning (incorporated by reference to Exhibit
99.3 to the Current Report on Form 8-K, dated February 13, 2008)10.28
    
    *
    
    Amended and Restated Employment Agreement, dated February 7, 2008,
between AmSurg and Royce D. Harrell (incorporated by reference to Exhibit
99.5 to the Current Report on Form 8-K, dated February 13, 2008)10.29
    
    *
    
    Amended and Restated Employment Agreement, dated February 7, 2008,
between AmSurg and Billie A. Payne (incorporated by reference to Exhibit
99.4 to the Current Report on Form 8-K, dated February 13, 2008)10.30
    
    *
    
    Employment Agreement, dated February 28, 2005, between Frank J. Coll and
AmSurg (incorporated by reference to Exhibit 99.1 to the Current Report
on Form 8-K, dated February 28, 2005)10.31
    
    
    
    Schedule of Non-employee Director Compensation21.1
    
    
    
    Subsidiaries of AmSurg23.1
    
    
    
    Consent of Independent Auditors24.1
    
    
    
    Power of Attorney (appears on page
65)31.1
    
    
    
    Certification of Chief Executive Officer pursuant to Rule 13a-14(a)31.2
    
    
    
    Certification of Chief Financial Officer pursuant to Rule 13a-14(a)32.1
    
    
    
    Section 1350 Certifications
 
 *
    
    Management contract or compensatory plan, contract or arrangement 64




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##### Table of Contents



Signatures
  AMSURG CORP.February 27, 2008
    By:
    /s/  Christopher A. HoldenChristopher A. Holden(President and Chief Executive Officer)   Signature
    
    Title
    
    Date/s/ Christopher A. Holden

Christopher A. Holden
    
    President, Chief
Executive Officer and
Director (Principal
Executive Officer)
    
    February 27, 2008/s/ Claire M. Gulmi

Claire M. Gulmi
    
    Executive Vice
President, Chief
Financial Officer,
Secretary and
Director (Principal
Financial and
Accounting Officer)
    
    February 27, 2008/s/ Thomas G. Cigarran

Thomas G. Cigarran
    
    Chairman of the Board
    
    February 27, 2008/s/ James A. Deal

James A. Deal
    
    Director
    
    February 27, 2008/s/ Steven I. Geringer

Steven I. Geringer
    
    Director
    
    February 27, 2008/s/ Debora A. Guthrie

Debora A. Guthrie
    
    Director
    
    February 27, 2008/s/ Henry D. Herr

Henry D. Herr
    
    Director
    
    February 27, 2008/s/ Kevin P. Lavender

Kevin P. Lavender
    
    Director
    
    February 27, 2008/s/ Ken P. McDonald

Ken P. McDonald
    
    Director
    
    February 27, 2008/s/ Bergein F. Overholt, M.D.

Bergein F. Overholt, M.D.
    
    Director
    
    February 27, 2008
 65




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##### Table of Contents



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
 
   
 S-1




---



##### Table of Contents



AmSurg Corp.
Schedule II  Valuation and Qualifying Accounts
For the Years Ended December 31, 2007, 2006 and 2005
(In thousands
 Additions
    
    DeductionsBalance at
    
    Charged to
    
    Charged to
    
    Charge-off
    
    Balance atBeginning
    
    Cost and
    
    Other
    
    Against
    
    End ofof Period
    
    Expenses
    
    Accounts (1)
    
    Allowances
    
    PeriodAllowance for uncollectible
accounts included under the
balance sheet caption Accounts
receivable:Year ended December 31, 2007
    
    $
    6,628
    
    
    $
    14,286
    
    
    $
    1,885
    
    
    $
    (14,489
    )
    
    $
    8,310Year ended December 31, 2006
    
    $
    6,189
    
    
    $
    11,418
    
    
    $
    1,149
    
    
    $
    (12,128
    )
    
    $
    6,628Year ended December 31, 2005
    
    $
    5,119
    
    
    $
    9,033
    
    
    $
    1,045
    
    
    $
    (9,008
    )
    
    $
    6,189
 
 (1)
    
    Valuation of allowance for uncollectible accounts as of the acquisition date of physician
practice-based surgery centers, net of dispositions. See Item 8 Financial Statements and
Supplementary Data  Notes to the Consolidated Financial Statements  Note 2. S-2