Here are five smart moves for surgery center administrators.
1. Define procedure "start times" to keep the schedule on track. Different specialists within the surgery center often have a different interpretation of what start times are. Anesthesiologists will have a different idea than perioperative nurses and OR technicians about when the actual "start time" begins. Larry Teuber, MD, chief medical officer and president of Medical Facilities Corporation and founder and physician executive of Black Hills Surgery Center, recommends defining start times; his group defined "start time" as the moment when the surgeon walks into the pre-op room and sees the patient.
"The fact is, everything depends on the surgeon coming to talk to the patient, sign the extremity, autograph pre-op consent and make sure the patient is ready to go," says Dr. Teuber. "There is a huge amount of wasted time if you think of the number of people who are lined up waiting for surgery — pre-op nurses, anesthesiologists, circulators, surgical assistants, postoperative specialists and recovery specialists — all dependent on when the surgeon is present in the morning. The costs on payroll are huge even if the surgeon is 15 minutes late."
Once the "start time" is defined, preoperative staff can prepare the patient before that time and everyone else will manage their schedule based on the surgeon entering the patient's room on time.
2. Benchmark room utilization. Every month, Carolyn R. Hollowood, administrator at City Place Surgery Center in St. Louis, which is affiliated with Meridian Surgical Partners, gathers the data from hours spent delivering care per patient and room utilization to derive the monthly percentage of room use. "I balance what we have available with what we actually used so we can improve for the next month," she says. "Usually it's a pretty easy fix, if you are watching it on a monthly basis. If you let the problem go for six months, it's not as easy to find a solution."
Efficiency is a key element to physician satisfaction, says Ms. Lampron, and quick turnover times are important. "We benchmark how long it takes for us to clean the room and set it up for the next case after the first patient leaves the OR," she says. "We also look at how physicians are using block time in the OR. If they are using the room for surgery 75 percent to 80 percent of the time, that's good. If the physician is only using the room 50 percent of the four hour block schedule, we need to adjust their schedule for a higher utilization rate."
Adjusting the schedule might mean finding a different time or day that works better within the physician's schedule.
3. Form a clear strategy around reimbursement. Nap Gary, COO of Regent Surgical Health, says in his experience, the most financially successful centers are those that think carefully about their reimbursement strategy based on their market. He says there is no "one-size-fits-all" policy for ASC reimbursement. For example, while a large percentage of Medicare is generally considered risky for surgery centers, centers can make Medicare work if they rely heavily on orthopedics and other well-reimbursed specialties. "Similarly, there are specialties that don't typically get reimbursed well by commercial payors, but the right mix of them can work in particular markets," says Mr. Gary.
He says successful administrators will understand how much money they make from each payor and how their managed care contracts affect their profitability. For example, surgery center administrators should break down reimbursement rates by procedure and payor. He says the best administrators also have an "enormous bundle of tricks" when it comes to reimbursement. They have educated themselves on negotiation tactics and understand when to walk away from the table, when to accept an offer and when to end a relationship with an insurance company.
4. Discipline employees appropriately. John Merski Jr., Managing Partner and Executive Director of Human Resources for MedHQ, says the number one rule of employee discipline is, "Act early." Don't wait until the twentieth time an employee shows up late to work to say something, because your reaction at that point will be much stronger than if you had spoken to the employee the first time. "If you notice a behavior not up to the standards of the company, you need to intercede with the gentlest approach at coaching," Mr. Merski says. "When that fails, you need to take a direct and structured approach that may result in the termination of the employee."
For example, when an employee comes in late for the first time, sit down and ask him or her about the reason for the lateness. Assure them that you understand but that the surgery center needs their presence and punctuality to function properly. That way, if the employee comes in late again, you can take a slightly more direct approach, until eventually you start discussing suspension, pay cuts or termination. It is well known that a "retooling" of an employee is considerably more beneficial to the workplace than a replacement if it can be completed properly.
5. Conduct valuation of the ASC. It's important to understand the value of your surgery center, and bringing in an outside group to conduct the valuation can be helpful. "We did a business valuation (real estate, equipment, and operations) for an ASC owned by a group of physicians," says Adam Lynch of Principle Valuation. "They were considering selling to a local hospital and wanted to know the different values. This valuation was done before any discussions took place with the hospitals. "
Why was it smart? It is crucial to know what you are worth and why. "An owner may have an idea what they are worth or the number they would prefer, but getting an outside valuation gives you market value," says Mr. Lynch. "This group was proactive and was able to use our information to help with their strategy."
1. Define procedure "start times" to keep the schedule on track. Different specialists within the surgery center often have a different interpretation of what start times are. Anesthesiologists will have a different idea than perioperative nurses and OR technicians about when the actual "start time" begins. Larry Teuber, MD, chief medical officer and president of Medical Facilities Corporation and founder and physician executive of Black Hills Surgery Center, recommends defining start times; his group defined "start time" as the moment when the surgeon walks into the pre-op room and sees the patient.
"The fact is, everything depends on the surgeon coming to talk to the patient, sign the extremity, autograph pre-op consent and make sure the patient is ready to go," says Dr. Teuber. "There is a huge amount of wasted time if you think of the number of people who are lined up waiting for surgery — pre-op nurses, anesthesiologists, circulators, surgical assistants, postoperative specialists and recovery specialists — all dependent on when the surgeon is present in the morning. The costs on payroll are huge even if the surgeon is 15 minutes late."
Once the "start time" is defined, preoperative staff can prepare the patient before that time and everyone else will manage their schedule based on the surgeon entering the patient's room on time.
2. Benchmark room utilization. Every month, Carolyn R. Hollowood, administrator at City Place Surgery Center in St. Louis, which is affiliated with Meridian Surgical Partners, gathers the data from hours spent delivering care per patient and room utilization to derive the monthly percentage of room use. "I balance what we have available with what we actually used so we can improve for the next month," she says. "Usually it's a pretty easy fix, if you are watching it on a monthly basis. If you let the problem go for six months, it's not as easy to find a solution."
Efficiency is a key element to physician satisfaction, says Ms. Lampron, and quick turnover times are important. "We benchmark how long it takes for us to clean the room and set it up for the next case after the first patient leaves the OR," she says. "We also look at how physicians are using block time in the OR. If they are using the room for surgery 75 percent to 80 percent of the time, that's good. If the physician is only using the room 50 percent of the four hour block schedule, we need to adjust their schedule for a higher utilization rate."
Adjusting the schedule might mean finding a different time or day that works better within the physician's schedule.
3. Form a clear strategy around reimbursement. Nap Gary, COO of Regent Surgical Health, says in his experience, the most financially successful centers are those that think carefully about their reimbursement strategy based on their market. He says there is no "one-size-fits-all" policy for ASC reimbursement. For example, while a large percentage of Medicare is generally considered risky for surgery centers, centers can make Medicare work if they rely heavily on orthopedics and other well-reimbursed specialties. "Similarly, there are specialties that don't typically get reimbursed well by commercial payors, but the right mix of them can work in particular markets," says Mr. Gary.
He says successful administrators will understand how much money they make from each payor and how their managed care contracts affect their profitability. For example, surgery center administrators should break down reimbursement rates by procedure and payor. He says the best administrators also have an "enormous bundle of tricks" when it comes to reimbursement. They have educated themselves on negotiation tactics and understand when to walk away from the table, when to accept an offer and when to end a relationship with an insurance company.
4. Discipline employees appropriately. John Merski Jr., Managing Partner and Executive Director of Human Resources for MedHQ, says the number one rule of employee discipline is, "Act early." Don't wait until the twentieth time an employee shows up late to work to say something, because your reaction at that point will be much stronger than if you had spoken to the employee the first time. "If you notice a behavior not up to the standards of the company, you need to intercede with the gentlest approach at coaching," Mr. Merski says. "When that fails, you need to take a direct and structured approach that may result in the termination of the employee."
For example, when an employee comes in late for the first time, sit down and ask him or her about the reason for the lateness. Assure them that you understand but that the surgery center needs their presence and punctuality to function properly. That way, if the employee comes in late again, you can take a slightly more direct approach, until eventually you start discussing suspension, pay cuts or termination. It is well known that a "retooling" of an employee is considerably more beneficial to the workplace than a replacement if it can be completed properly.
5. Conduct valuation of the ASC. It's important to understand the value of your surgery center, and bringing in an outside group to conduct the valuation can be helpful. "We did a business valuation (real estate, equipment, and operations) for an ASC owned by a group of physicians," says Adam Lynch of Principle Valuation. "They were considering selling to a local hospital and wanted to know the different values. This valuation was done before any discussions took place with the hospitals. "
Why was it smart? It is crucial to know what you are worth and why. "An owner may have an idea what they are worth or the number they would prefer, but getting an outside valuation gives you market value," says Mr. Lynch. "This group was proactive and was able to use our information to help with their strategy."