Administrator Amy Sinder and Amerinet Vice President of Clinical and Supply Chain Operations Lori Pilla present seven strategies for controlling surgery center preference item costs without losing physicians.
Physicians are the life blood of a surgery center. They drive case volume and revenue, but the cost of items listed on physician preference cards can start to add up.
"Supplies are typically one-third of the overhead cost in running a surgery center, so if you can reduce your supply cost, you can improve profits in many cases," says Amy Sinder, MS, administrator of CBC Surgery Center in Schererville, Ind. Managing physician preference items is a key place to reduce costs, though it may be a delicate process.
Here are seven ways to control the cost of preference items without damaging physician satisfaction or losing any cases.
1. Invite physician involvement. Having an open door policy for physicians performing procedures at surgery centers allows ASC leaders to create productive relationships. Any question on preference items should be presented to physicians. "Most of the frustration comes when there is a lack of communication. It is important to involve your physicians early and often in the discussion around these items," say Ms. Pilla.
Preference item management begins with a conversation, rather than a black and white mandate. Physicians are leaders in patient care and what to be directly involved in decisions that affect how that care is provided.
2. Select a physician champion. Surgery centers vary in size, but there are likely multiple surgeons performing cases at the center. "Identify a physician champion that will support your efforts and has an opinion respected by his or her peers," says Ms. Pilla.
A physician champion is often an owner in the center, though this does not have to be the case. This physician leader will be able to analyze the different procedures being performed, help identify how different service lines could work together to reduce costs and open the discussion of implants and supplies being used with fellow surgeons.
3. Leverage data. When opening up the floor for the discussion of preference items, data from both the cost and outcomes perspective will help physicians understand the issue at hand. "I've found that many physicians respond well to data," says Ms. Sinder. "I don't demand that they change their items, but I do inform them of cost of the supplies used on their cases."
A physician champion will be able to lend a hand in this area as well. "By surgeon, extrapolate cost per case with implants and supplies typically used. Physician champions will be able to identify outliers. Those physicians will be in a better position to begin a discussion with peers," says. Ms. Pilla. Whether approached by a physician or peer, data will allow physicians to see how switching preference items will affect not only costs, but also whether or not it affects patient outcomes.
4. Compromise. A significant portion of physician satisfaction is the power of decision. If a physician decides to keep using a more expensive item, there is no need to risk damaging the center's relationship with that physician by insisting on a switch.
"If they have good reasons for not wanting to use something cheaper, I'll ask them to look at other cases they do to see if they can help us find other areas to save money," says Ms. Sinder. The physician is invited to be directly involved in the center's operations without being forced to change a strong preference.
5. Strategically approach standardization. Complete standardization of supplies and implants is unlikely, especially at a multispecialty surgery center with several physicians. "You won't necessarily be moving all implants to one supplier. Instead of six suppliers, look to drop it down to two or three," says Ms. Pilla.
Sometimes moving towards standardization can take some creativity. One surgeon may be unwilling to switch from a high ticket item, but it may be possible to work with other surgeons performing the same types of cases. "Explore the possibility of having others moving to the supplier of the physician that will not change. This may give you high volume that can be used as leverage to negotiate a better price with that supplier," says Ms. Pilla.
6. Weigh the benefits. Physicians may decide to remain with more expensive items, but with an established line of communication administrators can always ask for the reason behind the decision. "I have an ENT physician that prefers to use a coblator for tonsillectomies. The coblator cost is more expensive, but the patients have much less pain postoperatively, which results in shorter PACU stays and fewer post-op phone calls," says Ms. Sinder. Though an item has a higher cost up front, it may result in better patient care and lower costs through other means.
7. Look beyond physicians. Though surgeons request and use preference items, they are not the only ones in the center to come in contact with those items. Aside from working with physicians, a surgery center's staff can help reduce costs. "I sometimes have reward programs where I give my staff changes to win prizes based on areas they identify to save money," says Ms. Sinder. Some nurses may use more supplies per case than others. Look for this and educate the staff on areas where waste can be reduced.
More Articles on Supply Chain Management:
Opening a Window of Opportunity: Outsourcing Procurement at Surgery Centers
5 Ways Materials Management Information Systems Can Improve Surgery Center Supply Chain
Amerinet Focuses on Physician Preference Items in Emerge Medical Partnership
Physicians are the life blood of a surgery center. They drive case volume and revenue, but the cost of items listed on physician preference cards can start to add up.
"Supplies are typically one-third of the overhead cost in running a surgery center, so if you can reduce your supply cost, you can improve profits in many cases," says Amy Sinder, MS, administrator of CBC Surgery Center in Schererville, Ind. Managing physician preference items is a key place to reduce costs, though it may be a delicate process. Here are seven ways to control the cost of preference items without damaging physician satisfaction or losing any cases.
1. Invite physician involvement. Having an open door policy for physicians performing procedures at surgery centers allows ASC leaders to create productive relationships. Any question on preference items should be presented to physicians. "Most of the frustration comes when there is a lack of communication. It is important to involve your physicians early and often in the discussion around these items," say Ms. Pilla.
Preference item management begins with a conversation, rather than a black and white mandate. Physicians are leaders in patient care and what to be directly involved in decisions that affect how that care is provided.
2. Select a physician champion. Surgery centers vary in size, but there are likely multiple surgeons performing cases at the center. "Identify a physician champion that will support your efforts and has an opinion respected by his or her peers," says Ms. Pilla.
A physician champion is often an owner in the center, though this does not have to be the case. This physician leader will be able to analyze the different procedures being performed, help identify how different service lines could work together to reduce costs and open the discussion of implants and supplies being used with fellow surgeons.
3. Leverage data. When opening up the floor for the discussion of preference items, data from both the cost and outcomes perspective will help physicians understand the issue at hand. "I've found that many physicians respond well to data," says Ms. Sinder. "I don't demand that they change their items, but I do inform them of cost of the supplies used on their cases."
A physician champion will be able to lend a hand in this area as well. "By surgeon, extrapolate cost per case with implants and supplies typically used. Physician champions will be able to identify outliers. Those physicians will be in a better position to begin a discussion with peers," says. Ms. Pilla. Whether approached by a physician or peer, data will allow physicians to see how switching preference items will affect not only costs, but also whether or not it affects patient outcomes.
4. Compromise. A significant portion of physician satisfaction is the power of decision. If a physician decides to keep using a more expensive item, there is no need to risk damaging the center's relationship with that physician by insisting on a switch.
"If they have good reasons for not wanting to use something cheaper, I'll ask them to look at other cases they do to see if they can help us find other areas to save money," says Ms. Sinder. The physician is invited to be directly involved in the center's operations without being forced to change a strong preference.
5. Strategically approach standardization. Complete standardization of supplies and implants is unlikely, especially at a multispecialty surgery center with several physicians. "You won't necessarily be moving all implants to one supplier. Instead of six suppliers, look to drop it down to two or three," says Ms. Pilla.Sometimes moving towards standardization can take some creativity. One surgeon may be unwilling to switch from a high ticket item, but it may be possible to work with other surgeons performing the same types of cases. "Explore the possibility of having others moving to the supplier of the physician that will not change. This may give you high volume that can be used as leverage to negotiate a better price with that supplier," says Ms. Pilla.
6. Weigh the benefits. Physicians may decide to remain with more expensive items, but with an established line of communication administrators can always ask for the reason behind the decision. "I have an ENT physician that prefers to use a coblator for tonsillectomies. The coblator cost is more expensive, but the patients have much less pain postoperatively, which results in shorter PACU stays and fewer post-op phone calls," says Ms. Sinder. Though an item has a higher cost up front, it may result in better patient care and lower costs through other means.
7. Look beyond physicians. Though surgeons request and use preference items, they are not the only ones in the center to come in contact with those items. Aside from working with physicians, a surgery center's staff can help reduce costs. "I sometimes have reward programs where I give my staff changes to win prizes based on areas they identify to save money," says Ms. Sinder. Some nurses may use more supplies per case than others. Look for this and educate the staff on areas where waste can be reduced.
More Articles on Supply Chain Management:
Opening a Window of Opportunity: Outsourcing Procurement at Surgery Centers
5 Ways Materials Management Information Systems Can Improve Surgery Center Supply Chain
Amerinet Focuses on Physician Preference Items in Emerge Medical Partnership