There are a lot of headwinds in the ambulatory surgery center industry right now, and this may force the ASC industry to move toward co-management agreements with hospitals and a general hospital outpatient department model.
At the 19th Annual Ambulatory Surgery Centers Conference in Chicago on Oct. 26, Tom Yerden, CEO of TRY Healthcare Solutions, gave his diagnosis of the ASC industry and why he believes ASCs are gradually going to move to the HOPD model.
Mr. Yerden said there were six major headwinds for ASCs right now: HOPDs continuing to receive much higher reimbursement rates than ASCs (ranging from 54 to 80 percent higher), an increase in regulatory challenges, the persistent economic downturn, general hospital competition/ASC acquisitions, healthcare reform involving accountable care organizations and physician recruitment challenges.
In addition to those red flags, Mr. Yerden said he predicts ASCs will move toward HOPD models because of fear, losing physicians to hospital employment and a poor job of demonstrating the high quality marks. Mr. Yerden also said more than 30 percent of ASCs are underperforming or failing, and much of that has to do with a lack of foresight from top managers.
"A lack of leadership will contribute to the growing number of ASC failures," Mr. Yerden said. "We put the best operating room clinician as an administrator, but we don't give them the tools to succeed. That's not fair."
In the end, ASCs are trying to "sell operating room minutes" regardless if they convert to an HOPD or not, Mr. Yerden said. With that in mind, ASC administrators must know their costs per OR minute, the profitability per OR for each specialty and their market share.
At the 19th Annual Ambulatory Surgery Centers Conference in Chicago on Oct. 26, Tom Yerden, CEO of TRY Healthcare Solutions, gave his diagnosis of the ASC industry and why he believes ASCs are gradually going to move to the HOPD model.
Mr. Yerden said there were six major headwinds for ASCs right now: HOPDs continuing to receive much higher reimbursement rates than ASCs (ranging from 54 to 80 percent higher), an increase in regulatory challenges, the persistent economic downturn, general hospital competition/ASC acquisitions, healthcare reform involving accountable care organizations and physician recruitment challenges.
In addition to those red flags, Mr. Yerden said he predicts ASCs will move toward HOPD models because of fear, losing physicians to hospital employment and a poor job of demonstrating the high quality marks. Mr. Yerden also said more than 30 percent of ASCs are underperforming or failing, and much of that has to do with a lack of foresight from top managers.
"A lack of leadership will contribute to the growing number of ASC failures," Mr. Yerden said. "We put the best operating room clinician as an administrator, but we don't give them the tools to succeed. That's not fair."
In the end, ASCs are trying to "sell operating room minutes" regardless if they convert to an HOPD or not, Mr. Yerden said. With that in mind, ASC administrators must know their costs per OR minute, the profitability per OR for each specialty and their market share.
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