In mid-March, hospitals across the country halted elective surgeries due to the SARS-CoV-2 pandemic. While many ASCs did experience initial shock—volume across the nation dropped 80% between February and April—most ASCs have now rebounded to pre-pandemic activity.
Although the dramatic drop in business created several financial challenges, it also gave ASC administrators time to pause and evaluate their business strategies. Now that many ASCs are operating at or near their historical volumes, it’s time to prepare for future growth.
Before you recruit additional surgeons and/or add specialties and services, make sure to have these financial management strategies in place.
1. Develop clinical protocol best practices. Document all processes tied to operating your ASC efficiently. Clinical protocol best practices may include the following:
• Patient selection: Detail which patients are suitable candidates for the procedures you offer based on the clinical characteristics of an ideal patient (e.g., healthy weight, under age 60) as well as contraindications (e.g., smoker, chronic disease).
• Pre-operative protocol: List the steps patients should take before their procedure and ensure staff provides that list to all patients.
• Quality of process: Ensure administrators have a solid understanding of your quality assurance performance improvement program.
• Staffing: Detail the training that staff must receive upon joining your facility and log the date of completion.
• Technology: Ensure your ASC has the revenue cycle management, analytics, and other critical technologies to operate at its best.
• Post-care protocol: Develop written at-home care instructions for patients. Ensure they understand what to expect in the hours and days after surgery.
2. Develop a strong patient outreach program. Educating the scheduling staff who work in surgeons’ offices is one of the most beneficial patient outreach steps you can take. When a patient calls to schedule a surgery, your staff needs to be well versed about the different facility options and should be able to communicate the benefits of a surgery center to the patients.
In addition to educating the scheduling staff, ASCs can enhance patient outreach by creating brochures, fact sheets, video testimonials, and other collateral. Promote that content through social media, email campaigns, and other channels. This will allow patients to make an informed decision regarding the location of their surgery.
3. Negotiate managed care contracts. Before you add a new program or service, research the following for a productive discussion with payers:
• Market rates at hospitals, outpatient centers, and ASCs in your region. This information will help you understand how far you can negotiate. You can also use this data to show payers how much they’ll save by moving a procedure to your facility.
• Fixed and variable costs for these procedures and your target profit margin.
• The technology you use and the advantages it brings to your practice and to payers.
• The quality of your surgeons.
• The quality of your outcomes.
• The frequency with which you perform certain procedures. When negotiating managed care contracts, you may want to push for more competitive rates for procedures you perform frequently and concede on others.
4. Develop strong front-end processes. According to a survey from Amino, more than one third of Americans (37%) cannot afford an unexpected medical bill of $100 or more.1 To keep uncollected patient balances under control, provide patients with cost estimates before surgery and collect as much of their portion up front as possible.
To improve efficiency, make sure scheduling, registration, insurance verification, pre-authorization, pre-op, and other front-end processes are as streamlined as possible. Technology can help strengthen your front-end processes; however, it can’t replace experienced, well-trained staff.
5. Provide financial counseling and education. Uncollected patient debt can affect your bottom line by up to 30% according to our data. And with the rise in high-deductible health plans (HDHP), patients face more financial responsibility than ever.
Financial counseling ensures patients understand their responsibility before they arrive for surgery. Technology can be leveraged to automate this process and can also help to streamline collections. To enhance the patient experience, consider offering recurring payment plans, medical loans through organizations such as Care Credit, and multiple ways to pay. In the COVID-19 era, patients also appreciate contactless payment.
6. Improve revenue cycle management. Accurate coding is crucial for compliance as well as to ensure your ASC has the right data when reporting quality benchmarks in value-based payment models. Effective revenue cycle management also includes accurate charge posting associated with implants, accurate claims payments, accounts payable and receivable, denial management and appeals.
Advanced revenue cycle management platforms automate most of these tasks, but they need to be implemented and used by experienced, well-trained staff.
7. Sophisticated analytics. Smart data analytics gives you a full and complete picture of your ASC. Analytics contain key performance indicators (KPIs) that highlight all aspects of your revenue. This data helps you not only understand trends, but also gives you the insight needed to make informed decisions moving forward.
While numbers and graphs will provide interesting information, it takes experienced analysts to interpret the data and advise you on how to make the most of a growing ASC market. Which specialties should you pursue? Should you eliminate a low-performing service? Are your operating rooms running as efficiently as they should? The data—in the right hands—will guide you.
The pandemic has prompted patients to think differently about how and where we receive care. As elective surgeries pick up pace, more patients than ever are choosing ASCs as a safe, cost-effective setting. Implement sound financial management to make the most of today’s opportunities.
Stay tuned for future articles where we take a deep dive into each of these 7 strategies.
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| References |
1. Levy, Hannah. “Survey shows Americans are seriously worried about healthcare costs—but don’t know what to do about it.” Amino blog, March 21, 2017.