Here are seven observations on factors driving surgery center case volume, based on data from VMG Health's Multi-Specialty ASC Intellimarker 2010.
1. GI/endoscopy dominates the mix overall. In a survey of 190 multi-specialty ASCs, VMG Health found that GI/endoscopy dominated case volume mix, representing 24 percent of case volume. The next-largest piece of the pie was ophthalmology (19 percent), followed by orthopedics (17 percent) and pain management (14 percent). The numbers differed slightly when the centers were broken down by geographic location; while GI/endoscopy was still king in many areas, the margins narrowed. ASCs in the Western United States (defined as California, Oregon, Washington, Nevada, Hawaii, Idaho, Montana, Wyoming, Utah and Arizona) performed more pain management cases, at 18 percent of total case volume. GI/endoscopy, ophthalmology and orthopedics were tied for second at 17 percent. In the southwest, ophthalmology dominated at 24 percent; in the Midwest, orthopedics took 21 percent and in the Southeast and Northeast, GI/endoscopy cleaned up at 35 and 41 percent of total case volume, respectively.
2. Case volume dictates operating income. Unsurprisingly, centers that perform more cases walk away with higher net revenue, operating income and EBITDA. Centers that perform more than 5,999 cases every year have an average operating income of $1,736,000 and an average EBITDA of $1,967,000, significantly more than their peers who perform 3,000-5,999 cases annually. The sector with the lowest number of cases per year — fewer than 3,000 — reported an average operating income of $302,000 and an average EBITDA of $454,000.
3. Administrators make more at high-volume ASCs. Administrators at high-volume ASCs (those than perform more than 5,999 cases yearly) earn $110,000, more than administrators at medium and low-volume ASCs — and more than the industry average of $107,015. Surprisingly, the increase in administrator salary growth is not linear; administrators at low-volume ASCs (those that perform fewer than 3,000 cases yearly) make $106,811 annually, nearly $4,000 more than their mid-volume counterparts.
4. Tech and administrative staff make less at high-volume ASCs. Administrative and technical staff earn more at low-volume ASCs than they do at medium- and high-volume centers, though only slightly. Low-volume ASCs also beat the industry average for tech and administrative salaries by almost $1 per hour.
5. The higher the volume, the fewer the hours per case. Perhaps because of all the cases they have to fit into their busy schedules, higher-volume ASCs have lower staff hours per case than their low-volume colleagues. Nurses hours per case at high-volume ASCs are 5.7, tech hours per case are 2.4 and administrative hours per case are 3.9. At ASCs with fewer than 3,000 annual cases, nurses spend an average of 7.1 hours per case, techs spend 2.7 hours and administrative staff spend 5.5 hours.
6. Western ASCs boast the highest case volume. Centers located in the Western United States perform an average of 4,471 cases every year, followed by Northeast and Southeast centers at 4,384 and 4,330. Midwest and Southwest ASCs make up the bottom of the pack, performing 3,681 and 3,522 cases on average, respectively.
7. Orthopedic-driven ASCs are less busy. Orthopedic cases can be more time-consuming than other specialties such as ophthalmology or GI, so it makes sense that the average annual case volume for centers that perform more than 50 percent orthopedics sits at 3,484, over 1,000 cases lower than the industry average of 4,698. While ASCs overall perform 18.8 cases per day, orthopedic-driven ASCs perform around 13.9.
About the Multi-Specialty ASC Intellimarker 2010
VMG information comes from VMG Health's Multi-Specialty ASC Intellimarker 2010 benchmarking study. VMG Health is a leading valuation and transaction advisory firm in healthcare. To receive a complimentary copy of VMG Health's 2010 Multi-Specialty ASC Intellimarker, click here.
1. GI/endoscopy dominates the mix overall. In a survey of 190 multi-specialty ASCs, VMG Health found that GI/endoscopy dominated case volume mix, representing 24 percent of case volume. The next-largest piece of the pie was ophthalmology (19 percent), followed by orthopedics (17 percent) and pain management (14 percent). The numbers differed slightly when the centers were broken down by geographic location; while GI/endoscopy was still king in many areas, the margins narrowed. ASCs in the Western United States (defined as California, Oregon, Washington, Nevada, Hawaii, Idaho, Montana, Wyoming, Utah and Arizona) performed more pain management cases, at 18 percent of total case volume. GI/endoscopy, ophthalmology and orthopedics were tied for second at 17 percent. In the southwest, ophthalmology dominated at 24 percent; in the Midwest, orthopedics took 21 percent and in the Southeast and Northeast, GI/endoscopy cleaned up at 35 and 41 percent of total case volume, respectively.
2. Case volume dictates operating income. Unsurprisingly, centers that perform more cases walk away with higher net revenue, operating income and EBITDA. Centers that perform more than 5,999 cases every year have an average operating income of $1,736,000 and an average EBITDA of $1,967,000, significantly more than their peers who perform 3,000-5,999 cases annually. The sector with the lowest number of cases per year — fewer than 3,000 — reported an average operating income of $302,000 and an average EBITDA of $454,000.
3. Administrators make more at high-volume ASCs. Administrators at high-volume ASCs (those than perform more than 5,999 cases yearly) earn $110,000, more than administrators at medium and low-volume ASCs — and more than the industry average of $107,015. Surprisingly, the increase in administrator salary growth is not linear; administrators at low-volume ASCs (those that perform fewer than 3,000 cases yearly) make $106,811 annually, nearly $4,000 more than their mid-volume counterparts.
4. Tech and administrative staff make less at high-volume ASCs. Administrative and technical staff earn more at low-volume ASCs than they do at medium- and high-volume centers, though only slightly. Low-volume ASCs also beat the industry average for tech and administrative salaries by almost $1 per hour.
5. The higher the volume, the fewer the hours per case. Perhaps because of all the cases they have to fit into their busy schedules, higher-volume ASCs have lower staff hours per case than their low-volume colleagues. Nurses hours per case at high-volume ASCs are 5.7, tech hours per case are 2.4 and administrative hours per case are 3.9. At ASCs with fewer than 3,000 annual cases, nurses spend an average of 7.1 hours per case, techs spend 2.7 hours and administrative staff spend 5.5 hours.
6. Western ASCs boast the highest case volume. Centers located in the Western United States perform an average of 4,471 cases every year, followed by Northeast and Southeast centers at 4,384 and 4,330. Midwest and Southwest ASCs make up the bottom of the pack, performing 3,681 and 3,522 cases on average, respectively.
7. Orthopedic-driven ASCs are less busy. Orthopedic cases can be more time-consuming than other specialties such as ophthalmology or GI, so it makes sense that the average annual case volume for centers that perform more than 50 percent orthopedics sits at 3,484, over 1,000 cases lower than the industry average of 4,698. While ASCs overall perform 18.8 cases per day, orthopedic-driven ASCs perform around 13.9.
About the Multi-Specialty ASC Intellimarker 2010
VMG information comes from VMG Health's Multi-Specialty ASC Intellimarker 2010 benchmarking study. VMG Health is a leading valuation and transaction advisory firm in healthcare. To receive a complimentary copy of VMG Health's 2010 Multi-Specialty ASC Intellimarker, click here.