10 Key Steps to Immediately Improve Profits
At the 19th Annual Ambulatory Surgery Centers Conference in Chicago on Oct. 26, Ann Geier, senior vice president of operations, Susan Kizirian, chief operating officer, and Rob Westergard, chief financial officer, of Ambulatory Surgical Centers of America, discussed 10 important steps to immediately improve profits.
1. Change management. It is critical ASCs manage change by first instilling a culture of learning, strong leadership and effective communications.
2. Materials management. Since supply costs are one of the two largest expenses in ASCs, facilities must implement certain checks and balances and learn to embrace technology. Check and balances include par levels or other inventory maintenance, standardized language and unit pricing. Group purchasing organizations are also critical to savings costs and managing materials.
3. Case costing. The key to case costing is calculating the overhead cost per OR minute and adding the cost of supplies. This information can be gleaned from vendors, software reports and preference cards. Important next steps include careful review of data, data sharing and discussions on lowering costs.
4. Physician recruitment. Recruitment should include both cold calls and networking. ASCs may want to target key specialties such as orthopedics, pain management and spine. Give candidates the VIP treatment.
5. Staffing. Staffing is one the largest expenses for ASCs, in addition to supply costs. ASCs should build a core team of full-time employees and supplement with part-time and per diem employees. Employees should be cross-trained to fill multiple roles.
6. Schedule compression. Also, facilities must compress cases and implement vertical scheduling. Leaders should involve clinical coordinators, physicians and office schedulers frequently.
7. Financial management. ASC administrators should be able to manage a wide range of finances, including accounts payable/receivable, billing and inventory, case costing, coding, contracts and more. There should also be a steady stream of financial reports on a daily, weekly and monthly basis.
8. Billing and collection. The administrator is the single most important factor in successful and efficient billing and collections. In addition, ASCs must have in place the right staff, processes, transcription and coding, training, outsourcing and quality control.
9. Benchmarking. Benchmarking is extremely crucial in order to know where your facility stands in terms of quality, performance and profit optimization. How does your facility compare to others? How can your facility improve? Key indicators to benchmark include clinical indicators, case volume, EBITDA margin, efficiency, collections and patient satisfactions.
10. Staying focused. ASCs must stay focused on several other key factors, including relationships with partners and effective leadership.
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