With lower reimbursements, stricter regulations and physicians choosing hospital employment, it isn't an easy time for ASCs. Here, four ASC administrators identify their top 10 concerns for the next 12 months and discuss how they plan to overcome those obstacles.
1. Declining reimbursement rates. Ask any ASC administrator about their top challenges for the next year, and they're bound to mention reimbursement cuts. ASCs across the country are struggling financially as insurers offer low fees for procedures — sometimes even lower than the rates offered by Medicare. Because ASCs often lack the negotiating clout of larger facilities, administrators say the only thing to do is wait — and hope lobbying efforts pay off.
In the meantime, T. Taylor Burnett, administrator for The Plastic Surgery Center in Flowood, Miss., says the only response to being offered insurer rates lower than Medicare is to just say no. "We're not going to accept them. We're going to tell them to take a hike," she says. "Some of the carriers have taken the opportunity to try and ratchet down on the reimbursements for ASCs and we do not have to take it. Those that can afford to stand up to the carriers should."
She says she found it particularly offensive that codes for breast reconstruction for cancer patients were paid at less than the Medicare rate. "We wanted to bring breast reconstruction patients who were immunocompromised and bring them to a facility where they could not get another infection," she says. "We wanted a safe and secure environment for those patients, and our largest carriers are lowering the rates [and preventing that]."
Asked how her center reacts to reduced reimbursements, Lynda Simon, administrator of St. John's Clinic: Head and Neck Surgery in Springfield, Mo., says, "It's a really simple answer: If our reimbursement is below what it costs to do the case, the case is sent to the hospital. If we lose 800 dollars on a case, you can't work like that. You can't live like that."
2. Stopping the flow of physicians out of ASCs toward hospitals. As reimbursement fees for surgery centers drop, many physicians are considering hospital employment, a trend that David Kelly, administrator of Samaritan North Surgery Center in Dayton, Ohio, cites as a major concern. "There's dour pressure on [physician] reimbursements and they're guaranteed a salary from the hospital, but it presents a challenge," he says. "How do you draw them back? You have to demonstrate that you have managed your costs and have a healthy bottom line and have a healthy, worthwhile investment."
The key to tackling this challenge is honesty, Mr. Kelly says. If your surgery center is successful and profitable, physicians will be more likely to work with you. "It's about reaching out and demonstrating how you do it better," he says. He says it helps to get interested physicians into the center so they can see your facility and witness staff satisfaction and quick turnover firsthand.
Judy Graham, administrator of Cypress Surgery Center in Wichita, Kan. says you can encourage physicians to stay at your center by taking extra effort to meet their needs. "There are so many places physicians can go nowadays," she says. "You have to make sure you have the best equipment and your staff has to know the procedures the physicians do." She says small touches can really make a difference: Her center made scrubs embroidered with the physicians' names, and Ms. Graham lays the scrubs out before the physicians arrive.
3. Competition with other ASCs and specialty hospitals. According to Ms. Graham, her city has about eight surgery centers and five specialty hospitals. "It's really an oversaturated market," she says. In order to remain competitive in a town that offers patients multiple options for surgery, you have to make your ASC stand out in the sea of competitors. Ms. Graham says her center has tackled this problem by marketing the center as a woman's center and offering gynecological surgery and in vitro fertilization. Because Cypress Surgery Center is located next to a breast imaging center, the two facilities can market themselves as a convenient "one-stop" location for female care.
If your surgery center is struggling to compete, Ms. Graham recommends specializing in a few surgeries that other centers do not provide. Hers is the only ASC in the Wichita area that offers pediatric dental, meaning they have a constant stream of patients who would otherwise have to travel outside the city.
She also recommends constantly evaluating any new services your ASC could offer. In the past year, Cypress Surgery Center has added sinus fusion and pediatric dental and is currently considering the addition of lap banding.
4. Bringing in new customers. Ms. Burnett says honesty is the best way to attract new customers. Make your ASC a welcoming facility that provides efficient, quality care, and patients will come to you. "Have your open house, make sure the public knows where you are and who you are, knows your success rates and superior customer service and low infection rates and fantastic outcomes," she says. "The more the public knows that, the more they're going to choose where they want to go and bring up your name when employers are negotiating employee benefit packages."
Mr. Kelly adds that increasing patient flow is not easy when your area is suffering as a result of the economy. "People aren't banging down the doors to move to Dayton, Ohio," he says. "So it becomes, how do you win that market share? How do you differentiate yourself?" He says the answer is three critical qualities: high patient satisfaction, high employee satisfaction and high doctor satisfaction.
5. Managing supplies effectively. Ms. Simon says her facility has responded to reimbursement cuts by managing supplies very carefully. "We have a very small owned inventory, so everything is in very, very short stock," she says. "We also do an annual bonus that is based on profit, so all our employees are empowered to keep cost down because they share in that bonus equally based on profit at the end of the year."
She says this means employees think twice before using supplies that may not be necessary. Before they open a suture, they make sure if it's needed. They let physicians know if they think a supply is being wasted.
Ms. Simon also holds contests to improve her staff's knowledge of the price of various supply items. The staff can participate by guessing how much a supply costs, and the person who gets closest wins a prize. "This means they know what everything costs. They know the best quality item at the best price," she says. "They're not going to skimp on quality, but they're not going to let the rep du jour just feed them products we don't need."
Ms. Graham adds that her center also keeps a small stock of inventory in the center and asks physicians to standardize their supplies. "We try to keep our inventory to just what we need," she says.
6. Meeting quality regulations. With increased focus on tracking quality and improving patient care, ASCs need to increase their quality oversight and get staff members and physicians on board with tracking their progress. For many ASCs, that means hiring a full-time quality director. At The Plastic Surgery Center, employing a quality safety director of nursing has "paid off tremendously in the quality we keep," says Ms. Burnett. They are also using a healthcare exchange interface to benchmark their facility against other ASCs across the country.
Ms. Graham adds that a center can demonstrate its quality by adequately preparing for and achieving accreditation. Cypress Surgery Center recently received AAAHC accreditation, a feat Ms. Graham attributes to "making sure you're doing all the studies and the quality control issues on a day-to-day basis, so that when the time comes around in three years for accreditation, your paperwork is up to date."
Mr. Kelly says providing high quality of care isn't just about patient safety and satisfaction: ASCs may soon have a vested financial interest in reducing infection rates and other hazards. "There's talk to having a policy so that if a patient incurs some kind of infection after discharge, your payment will be reduced," he says. "It ties into pay for performance."
Mr. Kelly says a center has to start with collected data so administrators can benchmark themselves against other ASCs across the country. "Eventually you may have to be in the top 10 percent in a pool of national surgery centers, and you'll get paid less if you fall below that," he says.
7. Meeting IT requirements with fewer personnel. Ms. Burnett says many ASCs face the obstacle of not having full-time IT personnel and still having to interface with health information exchanges, the state and other providers. If surgery centers don't educate themselves, she says, they may be taking advantage of by IT companies and carriers who charge them too much for services they may not need. "One of the things that ASC administrators really need to do is brush up on what's required and really do their due diligence in finding an IT support service that can help them if they don't have someone in-house," she says.
After Ms. Burnett was overcharged by an IT support service, The Plastic Surgery Center decided to grow its own IT support service. Ms. Burnett says that after finding smart, trustworthy people to support their information technology, the center has been able to move forward with HIE projects.
8. Motivating staff members. Most ASC administrators agree that motivating staff members in the midst of reimbursement cuts, stricter regulations and stiff competition can be a challenge. The key, Ms. Simon says, is to schedule regular activities to promote staff bonding. "We have a retreat every year, and we all do our CPR recertification on the same day," she says. "We also have office meetings where everybody has input and there's no punishment. It's all team-building, so if you come with a problem, you also come with two or three solutions."
Ms. Burnett adds that being honest with your colleagues about your financial situation will ease the process when you have to make difficult decisions about staffing.
9. Deciding whether to partner with a hospital. The relationship between an ASC and its nearby hospitals depends greatly on location, financial stability and other factors. Some ASCs choose to partner with hospitals to gain more negotiating and marketing power; others choose to remain independent.
Ms. Simon says her center's relationship with a local hospital has benefitted her ASC greatly. "Our relationship with the hospital means they have the same supplies. If they're low on something, we can share; if we're low, they can share," she says. "It also gives us some clout with purchasing power because all the purchasing goes through the system. That gives you a little bit of extra push because the hospital is working on your behalf to get the costs as low as they can."
She said her partnership with the hospital also gives St. John's a place to admit a patient if home care is not an option.
10. Decreasing wait time while maintaining quality. In an increasingly tougher economic climate, many surgery centers will be forced to examine their procedures, supplies and staffing to determine whether they can save money by streamlining their processes. "A simple example for me would be: We do a lot of cataract surgeries and, as preparation, you have to put eye drops in to dilate the eye and wait about twenty minutes for them to kick in," said Mr. Kelly. "So instead of bringing the patient back, dilating the eye, and waiting, you could dilate the eye and then bring another patient back and get them started. You eliminate that wasted time where they're just sitting there, shorten the wait time for the second patient and become more efficient."
Ms. Graham says her center makes sure to take care of any tasks that will increase a patient's wait time and therefore decrease their satisfaction. "We get all the information on health history over the telephone, so when the patient comes to the facility, we don't waste their time," she says. "We also turn the rooms over very quickly. We can do turnover for a case in 5-7 minutes, and we use new anesthesia drugs so that patients are not nauseated or real sleepy."
1. Declining reimbursement rates. Ask any ASC administrator about their top challenges for the next year, and they're bound to mention reimbursement cuts. ASCs across the country are struggling financially as insurers offer low fees for procedures — sometimes even lower than the rates offered by Medicare. Because ASCs often lack the negotiating clout of larger facilities, administrators say the only thing to do is wait — and hope lobbying efforts pay off.
In the meantime, T. Taylor Burnett, administrator for The Plastic Surgery Center in Flowood, Miss., says the only response to being offered insurer rates lower than Medicare is to just say no. "We're not going to accept them. We're going to tell them to take a hike," she says. "Some of the carriers have taken the opportunity to try and ratchet down on the reimbursements for ASCs and we do not have to take it. Those that can afford to stand up to the carriers should."
She says she found it particularly offensive that codes for breast reconstruction for cancer patients were paid at less than the Medicare rate. "We wanted to bring breast reconstruction patients who were immunocompromised and bring them to a facility where they could not get another infection," she says. "We wanted a safe and secure environment for those patients, and our largest carriers are lowering the rates [and preventing that]."
Asked how her center reacts to reduced reimbursements, Lynda Simon, administrator of St. John's Clinic: Head and Neck Surgery in Springfield, Mo., says, "It's a really simple answer: If our reimbursement is below what it costs to do the case, the case is sent to the hospital. If we lose 800 dollars on a case, you can't work like that. You can't live like that."
2. Stopping the flow of physicians out of ASCs toward hospitals. As reimbursement fees for surgery centers drop, many physicians are considering hospital employment, a trend that David Kelly, administrator of Samaritan North Surgery Center in Dayton, Ohio, cites as a major concern. "There's dour pressure on [physician] reimbursements and they're guaranteed a salary from the hospital, but it presents a challenge," he says. "How do you draw them back? You have to demonstrate that you have managed your costs and have a healthy bottom line and have a healthy, worthwhile investment."
The key to tackling this challenge is honesty, Mr. Kelly says. If your surgery center is successful and profitable, physicians will be more likely to work with you. "It's about reaching out and demonstrating how you do it better," he says. He says it helps to get interested physicians into the center so they can see your facility and witness staff satisfaction and quick turnover firsthand.
Judy Graham, administrator of Cypress Surgery Center in Wichita, Kan. says you can encourage physicians to stay at your center by taking extra effort to meet their needs. "There are so many places physicians can go nowadays," she says. "You have to make sure you have the best equipment and your staff has to know the procedures the physicians do." She says small touches can really make a difference: Her center made scrubs embroidered with the physicians' names, and Ms. Graham lays the scrubs out before the physicians arrive.
3. Competition with other ASCs and specialty hospitals. According to Ms. Graham, her city has about eight surgery centers and five specialty hospitals. "It's really an oversaturated market," she says. In order to remain competitive in a town that offers patients multiple options for surgery, you have to make your ASC stand out in the sea of competitors. Ms. Graham says her center has tackled this problem by marketing the center as a woman's center and offering gynecological surgery and in vitro fertilization. Because Cypress Surgery Center is located next to a breast imaging center, the two facilities can market themselves as a convenient "one-stop" location for female care.
If your surgery center is struggling to compete, Ms. Graham recommends specializing in a few surgeries that other centers do not provide. Hers is the only ASC in the Wichita area that offers pediatric dental, meaning they have a constant stream of patients who would otherwise have to travel outside the city.
She also recommends constantly evaluating any new services your ASC could offer. In the past year, Cypress Surgery Center has added sinus fusion and pediatric dental and is currently considering the addition of lap banding.
4. Bringing in new customers. Ms. Burnett says honesty is the best way to attract new customers. Make your ASC a welcoming facility that provides efficient, quality care, and patients will come to you. "Have your open house, make sure the public knows where you are and who you are, knows your success rates and superior customer service and low infection rates and fantastic outcomes," she says. "The more the public knows that, the more they're going to choose where they want to go and bring up your name when employers are negotiating employee benefit packages."
Mr. Kelly adds that increasing patient flow is not easy when your area is suffering as a result of the economy. "People aren't banging down the doors to move to Dayton, Ohio," he says. "So it becomes, how do you win that market share? How do you differentiate yourself?" He says the answer is three critical qualities: high patient satisfaction, high employee satisfaction and high doctor satisfaction.
5. Managing supplies effectively. Ms. Simon says her facility has responded to reimbursement cuts by managing supplies very carefully. "We have a very small owned inventory, so everything is in very, very short stock," she says. "We also do an annual bonus that is based on profit, so all our employees are empowered to keep cost down because they share in that bonus equally based on profit at the end of the year."
She says this means employees think twice before using supplies that may not be necessary. Before they open a suture, they make sure if it's needed. They let physicians know if they think a supply is being wasted.
Ms. Simon also holds contests to improve her staff's knowledge of the price of various supply items. The staff can participate by guessing how much a supply costs, and the person who gets closest wins a prize. "This means they know what everything costs. They know the best quality item at the best price," she says. "They're not going to skimp on quality, but they're not going to let the rep du jour just feed them products we don't need."
Ms. Graham adds that her center also keeps a small stock of inventory in the center and asks physicians to standardize their supplies. "We try to keep our inventory to just what we need," she says.
6. Meeting quality regulations. With increased focus on tracking quality and improving patient care, ASCs need to increase their quality oversight and get staff members and physicians on board with tracking their progress. For many ASCs, that means hiring a full-time quality director. At The Plastic Surgery Center, employing a quality safety director of nursing has "paid off tremendously in the quality we keep," says Ms. Burnett. They are also using a healthcare exchange interface to benchmark their facility against other ASCs across the country.
Ms. Graham adds that a center can demonstrate its quality by adequately preparing for and achieving accreditation. Cypress Surgery Center recently received AAAHC accreditation, a feat Ms. Graham attributes to "making sure you're doing all the studies and the quality control issues on a day-to-day basis, so that when the time comes around in three years for accreditation, your paperwork is up to date."
Mr. Kelly says providing high quality of care isn't just about patient safety and satisfaction: ASCs may soon have a vested financial interest in reducing infection rates and other hazards. "There's talk to having a policy so that if a patient incurs some kind of infection after discharge, your payment will be reduced," he says. "It ties into pay for performance."
Mr. Kelly says a center has to start with collected data so administrators can benchmark themselves against other ASCs across the country. "Eventually you may have to be in the top 10 percent in a pool of national surgery centers, and you'll get paid less if you fall below that," he says.
7. Meeting IT requirements with fewer personnel. Ms. Burnett says many ASCs face the obstacle of not having full-time IT personnel and still having to interface with health information exchanges, the state and other providers. If surgery centers don't educate themselves, she says, they may be taking advantage of by IT companies and carriers who charge them too much for services they may not need. "One of the things that ASC administrators really need to do is brush up on what's required and really do their due diligence in finding an IT support service that can help them if they don't have someone in-house," she says.
After Ms. Burnett was overcharged by an IT support service, The Plastic Surgery Center decided to grow its own IT support service. Ms. Burnett says that after finding smart, trustworthy people to support their information technology, the center has been able to move forward with HIE projects.
8. Motivating staff members. Most ASC administrators agree that motivating staff members in the midst of reimbursement cuts, stricter regulations and stiff competition can be a challenge. The key, Ms. Simon says, is to schedule regular activities to promote staff bonding. "We have a retreat every year, and we all do our CPR recertification on the same day," she says. "We also have office meetings where everybody has input and there's no punishment. It's all team-building, so if you come with a problem, you also come with two or three solutions."
Ms. Burnett adds that being honest with your colleagues about your financial situation will ease the process when you have to make difficult decisions about staffing.
9. Deciding whether to partner with a hospital. The relationship between an ASC and its nearby hospitals depends greatly on location, financial stability and other factors. Some ASCs choose to partner with hospitals to gain more negotiating and marketing power; others choose to remain independent.
Ms. Simon says her center's relationship with a local hospital has benefitted her ASC greatly. "Our relationship with the hospital means they have the same supplies. If they're low on something, we can share; if we're low, they can share," she says. "It also gives us some clout with purchasing power because all the purchasing goes through the system. That gives you a little bit of extra push because the hospital is working on your behalf to get the costs as low as they can."
She said her partnership with the hospital also gives St. John's a place to admit a patient if home care is not an option.
10. Decreasing wait time while maintaining quality. In an increasingly tougher economic climate, many surgery centers will be forced to examine their procedures, supplies and staffing to determine whether they can save money by streamlining their processes. "A simple example for me would be: We do a lot of cataract surgeries and, as preparation, you have to put eye drops in to dilate the eye and wait about twenty minutes for them to kick in," said Mr. Kelly. "So instead of bringing the patient back, dilating the eye, and waiting, you could dilate the eye and then bring another patient back and get them started. You eliminate that wasted time where they're just sitting there, shorten the wait time for the second patient and become more efficient."
Ms. Graham says her center makes sure to take care of any tasks that will increase a patient's wait time and therefore decrease their satisfaction. "We get all the information on health history over the telephone, so when the patient comes to the facility, we don't waste their time," she says. "We also turn the rooms over very quickly. We can do turnover for a case in 5-7 minutes, and we use new anesthesia drugs so that patients are not nauseated or real sleepy."