The power of hospital consolidation and recruiting staff continue to threaten ASC profitability in 2021. Here are the three biggest external risks to ASCs, according to eight leaders:
1. Securing reimbursements
Lance Ferguson, MD. Ophthalmologist at Commonwealth Eye Surgery (Lexington, Ky.): Little, if any, external threat to ASCs is as prevalent as a preferred/economical place of service. There is a threat of exclusion from payers to independent ASCs if consolidation allows for exclusive contracts. This is mitigated, however, in "any willing provider" states. Office-based surgery could become a threat if CMS lowers the quality control threshold demanded of ASCs for office-based operations, in which case the "additional" overhead required of an ASC would put it at a competitive disadvantage.
Becky Ziegler-Otis. Administrator of Ambulatory Surgical Center of Stevens Point (Wis.): It can really be a challenge to get adequate reimbursement from commercial payers, even if they know that we provide great value to consumers. Through my tenure as the ASC administrator, I've seen so many changes in the payer reimbursement landscape from the commercial and the government side. We have to be really careful with our case selection to assure cases we perform are adequately reimbursed and that the costs are covered by the revenue before we even place them on our surgery schedule.
Joe Peluso. Administrator at Aestique Surgery Center (Greensburg, Pa.): As CMS continues to support the transition of surgical procedures from hospital outpatient departments to ASCs, where surgery is performed at lesser cost, these more complex procedures require additional expensive supplies. The ASCs need to have similar price breaks on supplies that the larger healthcare systems enjoy. CMS needs to provide reimbursement for these supplies to achieve the cost savings provided by ASCs.
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2. Health system 'domination'
Raghu Reddy. Executive administrator at SurgCenter of Western Maryland (Cumberland): The most significant external threat is marketplace competition and/or domination by the hospital systems or its affiliates, mainly by physician employment and through hospital-owned ASCs or joint ventures. The hospital JVs are on the rise in many states, especially when physicians are selling their practices to the hospitals or joining supergroups that may affiliate with a hospital to minimize the politics.The health systems could make it hard if you plan to have a 100 percent physician-owned ASC or even in partnership with a management company, depending on the ASC location.
Trudy Wiig, RN. Administrator of Kerlan-Jobe Surgery Center (Los Angeles): It is human nature to protect the larger entity hospital at the expense of the smaller ASC instead of creating synergies among the two groups. Having been on both sides, make no mistake, it will be painful for many health system hospitals to move business into a partner ASC not on their campus because of the lack of payment parity among both venues. Meaning, what the health system hospitals lose to the ASC (partner or not) cannot cover their loss because hospital outpatient departments are paid three times the amount of money that an ASC partner will receive for the exact surgery case.
William Prentice. CEO of Ambulatory Surgery Center Association: One trend that is a potential concern is healthcare consolidation that we've seen over the last decade, which has allowed the big to get bigger, sometimes at the expense of some really strong independent healthcare providers in various markets. That is something we all have to keep an eye on; I believe bigger doesn't necessarily mean better.
3. Staff recruitment and retention
Matthew Solis. Administrator of Downtown Surgery Center (Orlanda, Fla.): Many local hospitals are giving exuberant sign-on bonuses, and so the retention of employees can be a bit of a battle. In all honesty, we try to sell them on the lifestyle available through an ASC (no weekends, call or holidays). Sometimes the all-mighty dollar can prevail.
Valerie Thiele, RN, CASC. Administrator of Madison Street Surgery Center (Denver): Our biggest threat currently is maintaining adequate staffing levels and recruitment of new talent. Once a registered nurse leaves the company, replacing the talent is extremely challenging.
Tammy Stanfield, BSN, RN. Administrator and Director of Nursing of North Pines Surgery Center (Conroe, Texas): Clinically, we have 10 full-time employees and two part-time RN employees. We have to have a versatile staff. There are three pro re nata RNs that work in preoperative care, postoperative care and the perianesthesia care unit. Both part-timers can run an operating room, work in a preoperative setting and/or the PACU. Our administrator can also work in the operating room, preoperative setting and the PACU as a last resort. Since we have a small staff, vacation time must be spread out amongst us — allowing one person at a time to take paid time off.
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