From supply chain issues to consolidation, four ASC leaders joined Becker's to discuss what the industry's next disruptors will look like.
Question: What will disrupt the ASC industry next?
Editor's note: These responses were edited lightly for brevity and clarity.
Debra Fin. Administrator of Great Lakes Bay Surgery & Endoscopy Center (Midland, Mich.): The old news is still active. ASCs will continue to see clinical staff recruitment woes and rising personnel expenses — particularly operating room circulators. Without the right staff and a stable group of teammates, it challenges the culture of an ASC and takes a great deal of operational focus to orient, integrate and support the standard of excellence and patient safety that ASCs deliver. We are continually working with staff to train, orient and join together on improving our work environment to deliver the work-life balance we promote.
The current item on the horizon is and continues to be the consolidation that is starting to accelerate as hospitals bring ASCs into their care delivery models and ASCs become aligned with equity partners. With approximately 74 percent of US physicians employed by hospitals or corporate entities, hospitals in many markets are using ASCs to right-size surgery delivery sites, prepare for ambulatory delivery of previous inpatient only and hospital outpatient department services and as a contracting advantage. Ambulatory ORs are now being considered a strategic resource in planning which cases will be done at what acuity level, thus opening up block time at higher level of care. ASCs are even a tool to keep high volume, quick turn cases out of office-based surgeries and a resource to pick up overflow which the post-pandemic demand has prioritized for many health systems.
Equity-backed independent physician-led ASCs gain a strategic partnership that brings access to capital and resources enabling expansion or even positioning them to weather competition in their market or owner retirements. Both of these business models mean more engaged physicians, and this is good for the ASC and patients.
Leslie Jebson. Regional Administrator at Prisma Health (Greenville, S.C.): Further adoption of team-based care delivery models and having orthopedic surgeons largely exclusively focused and utilized for surgery/surgical procedures. This will require incorporation and seamless orchestration of a team of providers supporting each surgeon/subspecialty. Team specifics might include the utilization of: advanced practice providers and/or physical therapists as intake screeners, athletic trainers as outpatient clinic support or as surgical support. RNs for patient education and navigation — pre- and post-discharge and rehabilitation and clerical support staff coordinating basic coding/payer authorizations etc.
I anticipate on average, flat, aggregate inpatient growth over the next five years (largest demand will be revision total joints) and a 5 percent average for outpatient aggregate growth over the next five years (largest demand will be shoulder replacements). Payers will drive further disruption, engaging covered lives/consumers to reassess their elective surgical care via transparent pricing, amenities and patient experience. This will result in further disruption to steerage and shifts in traditional referral pathways.
Jeremy Riley. CEO of GML Healthcare Consulting (Titusville, Fla.): Supply chain disruptions, staffing shortages, wage inflation, reductions in reimbursement, increased construction costs and ongoing regulatory changes continue to be the challenges at the forefront of operating a successful ASC. It's most definitely a balancing act for any administrator and attempting to project the future merely makes the job that much more challenging.
As most are already aware, supply chain costs are literally out of control. The ASCs that I've consulted with in the past 12 months have experienced a 10 to 24 percent increase in medical supply and equipment cost. ASCs aren't only experiencing an inflation in supply cost, but also have been impacted by a delay and/or a backlog in receiving ordered supplies. These shortages continue to be directly related to the pandemic, while others are a result of backlogged shipping ports, transportation glitches and factory closures in other countries.
Staffing shortages are projected to continue through 2024, if not longer. A large percentage of ASCs are operating with vacant positions and are struggling to recruit and retain. This scenario is all too familiar across the healthcare industry abroad. ASCs have found themselves in a position of need to be creative in their recruiting approach by designing recruitment incentives that not only attract high level talent, but improve motivation and maintain retention. A majority of studies demonstrate one-third of the healthcare workforce is on the edge and/or are burnt out.
Raghu Reddy. Chief Administrative Officer of SurgCenter of Western Maryland (Cumberland): Most positively, I think these items will disrupt the ASC industry next:
- Evolution of out-of-the-hospital strategy for payers and CMS; cardiology is making significant in-roads already.
- Technology is going to impact the ASC industry significantly with robotics, artificial intelligence and 3D printing in the distant future.
- Addition of more procedures to the ASC-CPL list by CMS and the rise of hybrid ASCs to adapt to the reimbursement shifts.
- Private equity firms will dominate the mergers and acquisitions markets, and hospitals will increase their focus on their ASC strategy.
- Implementation of value-based care and stringent certificate-of-need law states will have to adapt to lower the healthcare costs.