The following article is written by Ronald J. Mattson, MD, vascular surgeon and founding partner of The Surgery Center of the Main Line in Wayne, Pa., a Blue Chip Surgical Center Partners facility.
My experience as a founding investor and partner in the Surgery Center of the Main Line (SCML), a multi-specialty facility near Philadelphia, has been a very gratifying experience — both professionally and personally. First and foremost, I am very proud of the clinical excellence and outstanding patient experience offered at the center. Since we first opened the doors in 2007, the entire team at our surgery center was committed to delivering great outcomes in a patient-first environment, and we have consistently fulfilled that commitment.
But I am also very pleased with the highly efficient business operations we established and the strong financial outcomes we achieved. SCML has been consistently profitable for several years running. Unlike so many outpatient surgery centers that struggle with a great deal of financial turbulence, we started with a solid foundation of beneficial contracts and a clear business and worked steadily to move the business forward.
All of these efforts have paid off. Though we were confident going into the venture, the financial results exceeded even the most optimistic expectations of all the partners. The original investors have received outstanding return on our investments, and those surgeons who joined the ownership group as it expanded — like colorectal surgeon Philip Pearson, MD — have also done very well. Further, we love operating and treating patients here. We are as much 50 percent more productive as we are at the hospital and our patients and their families are much more comfortable. These were our goals as we built this business, and we have achieved them.
4 keys to success
When colleagues have asked me how our surgery center achieved success, I point to four critical principles or enablers.
1. Focused physicians. At the outset, we recognized that many ASCs struggle to overcome a few common challenges, including distracted or less than fully committed ownership groups. Our business partner, Blue Chip Surgical, emphasized this risk to us and therefore we chose only those surgeons who were quality clinicians and fully dedicated to the success of SCML. Not that they had to micromanage or oversee every operational detail, but rather be aware of the most important business metrics and the impact of their decisions about scheduling, supplies and the like. We benefitted from having doctors who possessed solid business knowledge, including clear recognition of the valuable role of a business partner (see below). ASC owners don't need MBAs, but having a solid business sense helps when the commitment is there.
The most important indicator of surgeon commitment was — and is — the willingness and ability to bring the necessary number of cases. That means every surgeon must deliver the cases he or she promised during the business planning phase. It also means "talking up" the center to colleagues and encouraging them to bring procedures to SCML. Obviously, patients come first, but because each member of our ownership team invested the time energy on these tasks, we stayed on top of the business from day one and built momentum for long-term success.
2. Excellent administrator. It has been said that a strong administrator is the heart and soul of a successful ASC. That is certainly true in our case. Our administrator, Karla German, RN, was often our brains and backbone, too. Karla had real insight into what it took for us to succeed, and exerted real leadership over the staff to help drive SCML toward its clinical and business goals.
Highly skilled in the OR, she was also very effective in managing the staff on an everyday basis — ensuring schedules were managed effectively, that practices were informed and the preferences of all surgeons (including non-owners who brought cases to SCML) were met. She also collaborated well with Blue Chip.
Because of Karla, our surgery center was not only efficiently run, but was also a pleasant place for patients and staff to come every day. At busy times, she kept us on an even keel and focused on the top priority: our patients. Karla is beyond compare in building camaraderie that has been a major underlying factor of our success. It can be difficult to measure culture and camaraderie, but I have no doubt that they have been a major enabler for SCML. (See below for more about the importance of teamwork.)
3. Right business partner: In my previous experiences with outpatient surgery centers, I saw how indifferent management partners and consultants could hold the business back. Specifically, I've seen how when a business partner does not contribute much, the surgeons are left to deal with zoning regulations, architects and contractors, administrative details and other relatively low-value matters that business partners ought to take care of.
To develop and manage SCML, we chose a business partner who had real expertise, know-how and best practices to contribute in all of these areas — plus contracting, back-office operations and financial management. Then we structured our working agreement to ensure that Blue Chip was invested in the overall success of the business. In the beginning, they helped ensure we had strong reimbursement contracts in place, even before we opened. And they helped ensure our relationship with the local hospital was cordial. We even considered making the hospital a part-owner, though they wished to invest in their own ASCs.
During our first 3.5 years of operations, working with Blue Chip, we were able to advance the business. We focused on the big goals, discussed operational details when necessary and worked to keep our board meetings efficient and productive (which everyone greatly appreciated). When issues arose (as they inevitably do), we worked with the Blue Chip team to address them in a transparent manner. They also brought a few issues to our attention. For the surgeons, that meant a high degree of confidence that the business was performing well and that there would be no unpleasant surprises (like emergency cash calls).
4. Outstanding teamwork. Make no mistake – outpatient surgery centers are definitely a team sport. Top-performing ASCs are notable for their highly effective teams and cultures of excellence. It starts with the ownership group. I've mentioned focus and commitment, but teamwork also matters to ensure that important decisions are fully supported and second-guessing is kept to a minimum. Also, teamwork means greater efficiency — the core owners assume different roles in managing the business. One might take the lead in recruiting new physicians, while another helps lead the selection of equipment and supplies, for example.
Teamwork extends to staff and the business partner, too. After we pulled together the finest surgeons in the area to be part of our center and selected a business partner we trusted, we sought the strongest support staff. In all of these areas, clinical expertise and a successful track record were important considerations, but so were interpersonal skills and the ability to function as part of a team. The bottom line, is that I would advise any surgeon considering an investment in new ASCs (or seeking to improve operations at an existing center) to think carefully about the value of teamwork in all areas of operations.
Bottom line: Multi-dimensional success
It goes without saying that my investment in surgery center ownership has been highly lucrative. But like most of my colleagues, I measure success across multiple dimensions beyond the strictly financial. By several other key measures — including physician satisfaction, staff satisfaction, clinical outcomes and quality care provided — SCML was even more successful. Everyone associated with our center has ample reason to be proud of our accomplishments and to feel confident that we maintain our extraordinarily high standard of quality as we move into a new era of operations.
Again, while this certainly has been a well executed and highly effective business venture, the experience of SCML speaks volumes as to what top-quality physicians and a strong, committed support team can do when they keep their priorities and principles aligned toward common goals.
Thank you to Blue Chip Surgical Center Partners for arranging this column. You can learn more about Blue Chip and read more surgeon stories at www.bluechipsurgical.com/insights.
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