While the majority of ASCs remain independent, increased consolidation within the industry has led some leaders to contemplate linking with hospitals or larger health systems as a strategy for more market-proof ASC growth.
ASC leaders gathered at Becker's 30th Annual Business and Operations of ASCs Meeting in Chicago to discuss the tradeoffs of partnering with hospitals.
"For a variety of reasons, sometimes you need to associate yourself with the 800-pound gorilla in order to maintain your footprint, so to speak. And then the big question is if you're going to associate, what do you do?" Michael Redler, MD, an orthopedic surgeon at Connecticut Orthopaedics in Camden, said.
Leveraging hospitals' more favorable reimbursement rates is a primary factor driving ASCs toward these partnerships.
"I think the reasons that you may consider that given a certain market is one you can achieve closer to a hospital outpatient rate depending on the involvement of the hospital," Dr. Redler said. "You do have their negotiating power, but you have to be very, very careful to choose a hospital system that will do what they say."
He cited a previous partnership that his center engaged in, where the larger system did not follow through on various promises made to the ASC.
"They didn't do a damn thing that they said they were going to do. They kind of gave you that, well, you get to use our name," Dr. Redler said. From that experience, his center was able to pivot into a more equitable partnership.
"So we were able to get out," he said. "We're now with Hartford Healthcare, who has done everything they said they were going to do and has helped us achieve better rates."
Hospital partnerships can also help fill caseloads at ASCs and provide a wider range of resources for smaller centers.
"And frankly, between SCA and Hartford Healthcare, even with this current IV fluid shortage with a horrific hurricane in North Carolina, they've kept us going with fluids," Dr. Redler said. "So the right partner doesn't have to be a hundred-pound gorilla and they don't have to be the evil person, but you got to be really careful because it's not going to be an equal playing field there."