At the 9th Annual Orthopedic, Spine and Pain Management-Driven ASC Conference in Chicago, Andrew Hayek, CEO of Surgical Care Affiliates, gave a presentation on the state of the ambulatory surgery center industry.
Mr. Hayek outlined several trends currently impacting surgery centers:
• Physician employment. The rate of physician employment continues to increase, Mr. Hayek said, with a continual focus on primary care physicians and cardiologists. Employment differs from region to region: In the Louisville, Ky., area, for example, approximately 80 percent of physicians are employed, while other markets are growing more slowly. Despite the differences between geographic areas, however, physician employment poses a threat to surgery centers, as hospitals gain "ownership" of physicians who could otherwise invest in ASCs.
• Fewer physicians per ASC. According to Mr. Hayek, there are approximately 20 physicians per ASC on average nationally. This drop in the number of available physicians has slowed the development of new centers. Mr. Hayek said 2010 was the first year that the healthcare industry did not see an increase in the number of ASCs.
• Unemployment. Continuing unemployment places pressure on ASC case volume and decreases the likelihood that consumers will pursue elective procedures, Mr. Hayek said.
• High-deductible plans. An increase in the number of high-deductible plans, for which deductibles can reach $1,000-$2,000, may dissuade patients from pursuing treatment, Mr. Hayek said. He said ASCs may have an opportunity if they can market cost savings available through surgery centers compared to the hospital.
What do these trends mean?
Mr. Hayek said these trends have led to slower surgery center growth and decreasing case volumes. He predicts that the future will see lower growth, flatter reimbursement and more disciplined control over ASC operations, as surgery centers are forced to lower staffing and supply costs to maintain profitability.
Emphasis on infection control
Mr. Hayek said surgery centers also need to embrace infection control practices by adopting tools from the ASC Quality Collaboration. He said that approximately 25 percent of ASCs currently report data to the AQC, and more centers need to get involved to give a better picture of the industry's infection control practices.
He said Surgical Care Affiliates has a saying: "When you pray, move your feet." This means that while surgery centers hope for better reimbursement rates and a more accurate picture of their outcomes in the public eye, they should take action to make these things a reality. This means adopting infection control tools, using data to benchmark outcomes and supporting transparency within centers and throughout the industry.
Healthcare reform and ASCs
Mr. Hayek said healthcare reform will affect ASCs in various ways, through the surge in insured Americans, cuts to reimbursement and insurance and payment reform. He expects ASCs to receive a one percent reimbursement cut every year for the next several years and said quality reporting will most likely "become a reality" in the next few years as payors start to tie payment to quality outcomes.
Learn more about Surgical Care Affiliates.
Related Articles on Surgery Centers:
Co-Management Arrangements: Key Tips for Success
ASC Profitability Relies on Effective Cost Management
Supply Changes for ASCs to Immediately Improve Profits
Mr. Hayek outlined several trends currently impacting surgery centers:
• Physician employment. The rate of physician employment continues to increase, Mr. Hayek said, with a continual focus on primary care physicians and cardiologists. Employment differs from region to region: In the Louisville, Ky., area, for example, approximately 80 percent of physicians are employed, while other markets are growing more slowly. Despite the differences between geographic areas, however, physician employment poses a threat to surgery centers, as hospitals gain "ownership" of physicians who could otherwise invest in ASCs.
• Fewer physicians per ASC. According to Mr. Hayek, there are approximately 20 physicians per ASC on average nationally. This drop in the number of available physicians has slowed the development of new centers. Mr. Hayek said 2010 was the first year that the healthcare industry did not see an increase in the number of ASCs.
• Unemployment. Continuing unemployment places pressure on ASC case volume and decreases the likelihood that consumers will pursue elective procedures, Mr. Hayek said.
• High-deductible plans. An increase in the number of high-deductible plans, for which deductibles can reach $1,000-$2,000, may dissuade patients from pursuing treatment, Mr. Hayek said. He said ASCs may have an opportunity if they can market cost savings available through surgery centers compared to the hospital.
What do these trends mean?
Mr. Hayek said these trends have led to slower surgery center growth and decreasing case volumes. He predicts that the future will see lower growth, flatter reimbursement and more disciplined control over ASC operations, as surgery centers are forced to lower staffing and supply costs to maintain profitability.
Emphasis on infection control
Mr. Hayek said surgery centers also need to embrace infection control practices by adopting tools from the ASC Quality Collaboration. He said that approximately 25 percent of ASCs currently report data to the AQC, and more centers need to get involved to give a better picture of the industry's infection control practices.
He said Surgical Care Affiliates has a saying: "When you pray, move your feet." This means that while surgery centers hope for better reimbursement rates and a more accurate picture of their outcomes in the public eye, they should take action to make these things a reality. This means adopting infection control tools, using data to benchmark outcomes and supporting transparency within centers and throughout the industry.
Healthcare reform and ASCs
Mr. Hayek said healthcare reform will affect ASCs in various ways, through the surge in insured Americans, cuts to reimbursement and insurance and payment reform. He expects ASCs to receive a one percent reimbursement cut every year for the next several years and said quality reporting will most likely "become a reality" in the next few years as payors start to tie payment to quality outcomes.
Learn more about Surgical Care Affiliates.
Related Articles on Surgery Centers:
Co-Management Arrangements: Key Tips for Success
ASC Profitability Relies on Effective Cost Management
Supply Changes for ASCs to Immediately Improve Profits