There is a mentality at some ambulatory surgery centers that if the facility is making money, it must performing well. However, an ASC which becomes complacent with its financial performance could mean lost opportunities to perform even better. Here are five areas Joe Zasa, co-founder and managing partner of ASD Management, says ASCs should examine closely to capture potential lost revenue.
1. GPO relationship. If your ASC works with a group purchasing organization, you might assume you're purchasing supplies at the cheapest rates possible. But Mr. Zasa says it's worth putting in some time to confirm if that's actually true. "Are you having your GPO regularly audit your ASC to ensure you're getting the proper, best pricing?" he says. "And are you doing spot audits of your top supplies" to further check for savings opportunities? Both are worthwhile undertakings to confirm you're keeping supply costs as low as possible.
2. Implant costs. With vendors such as implant companies which are not typically GPO participants, Mr. Zasa says it is critical to benchmark the costs of implantable devices with other ASCs to make sure you're getting the best prices. He says it's also important to watch for price increases on implants. "Some of those companies will do several percent increases twice per year," he says. "This goes on all of the time and it ends up being a 10-12 percent increase."
ASCs not monitoring their costs might allow this to happen without their ever realizing it. "They say, 'We like the rep, we know he's getting us good pricing,' " Mr. Zasa says. "Do you really? The rep isn't doing the pricing. His job is to be your buddy."
3. Collections. Mr. Zasa says some ASCs have the misconception that they're collecting the maximum amount on their cases just because they are remaining profitable. "But do you really know if your collectors are doing a great job of collecting?" Mr. Zasa says. "Are you checking to make sure your [staff members] are working the denials? When the insurance company denies a claim, are they working the denials properly and sending along supporting documentation or are they just shredding the denial? It's a sloth-factor."
4. Internal controls. ASCs should never become complacent with their operations and they need to ensure there is an effective checks and balances system in place, Mr. Zasa says. "Is your ASC regularly having third-party audits to ensure there are proper internal controls at your facility, including proper cash management?" he says. "If somebody is changing payroll, do you know it's being done properly and making sure what's in the employee files is what they're actually being paid? Are deposits being made properly?" Regular third-party audits can identify lost money, poor processes and also help to spot potential illegal activities, such as theft by a staff member, sooner.
5. Chargemaster. "As a general rule, we're price takers, not price makers, which is why reviewing your chargemaster every single year is extraordinarily important," Mr. Zasa says. "Typically most ASCs bill a multiple of the Medicare fee schedule. When the Medicare fee schedule changed a few years ago, if you [kept] the same price list, you were actually leaving money on the table for those claims where you were receiving a percentage of billed charges." Adjusting your chargemaster every year is an area where many ASCs can easily pick up revenue, he says.
Learn more about ASD Management. Contact Joe Zasa (joezasa@asdmanagement.com) at (214) 369-2996.
Read more from the leadership of ASD Management:
- Benchmarking Ambulatory Businesses
- 3 Best Practices for Handling Patient Complaints
- 5 Ways to Incent Good Behavior With Staff Bonuses