Here are five things for your ASC "To Do" list this year.
1. Perform a compensation review. If your surgery center has never performed a compensation review, you should do one this year, says John Merski Jr., executive director of human resources for MedHQ. You may also need to perform a compensation review if you notice indicators of dissatisfaction, such as high employee turnover, complaints about salary at your annual employee reviews or comments from the staff that similar positions at other facilities are better-paid.
"Generally the question comes up because when you do exit interviews, staff members say they're leaving for a job that pays more," he says. Once you have identified a problem with your compensation, you can start talking to employees to determine where you fall short. Mr. Merski says the ASC should conduct an employee survey that determines the strengths and weaknesses of your compensation plan. For example, perhaps some employees feel fairly compensated, and others don't. Perhaps your salaries are on target, but your benefit plan is meager compared to the local hospital. When employees have completed the survey, go over their answers and identify common themes so you understand the most prevalent areas of dissatisfaction.
2. Form a relationship with a healthcare lawyer. Physicians must be aware of Stark Law and referral issues to avoid accidentally breaking the law. They must also be aware of the potential for malpractice suits and be prepared for any action that could come their way. Select a competent "health lawyer" who can guide you through any issues that might arise. They will be helpful in assessing partnership contracts, as well as regulation issues. "The physicians have to understand how the wording in a contract could increase their liability," says Pedro Vergne-Marini, MD, managing member of Physicians Capital Investments.
3. Conduct a valuation. Principle Valuation recently did a business valuation (real estate, equipment, and operations) for an ASC owned by a group of physicians. "They were considering selling to a local hospital and wanted to know the different values," says Adam Lynch of Principle Valuation. "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. This group was proactive and was able to use our information to help with their strategy."
4. Track data and analyze trends. Keeping complete records not only allows a physician to better understand the operations of a center, from expenses to case mix to cost per procedure, but also helps identify trends and opportunities for improvement.
"Understanding the importance of accounting and record keeping for any business is key," says Kristine Mighion, MD, MBA, managing director and CEO of Healthcare Consultants International and host of Intimetv.com’s Healthcare Executive show. "That tends to be an area where doctors are not as strong. They don't get tend to be exposed to those concepts, and they don't tend to think that way."
She says physicians should have their ASCs track number of patients, type and quantity of procedures, as well as total revenues and revenue per procedure. They should review the records monthly or quarterly, and look for trends from month to month, quarter to quarter, and year to year. An analysis of these metrics can inform a physician whether the center does a lot of small procedures with lower returns or fewer large procedures with bigger returns, and as a result can help a physician plan the best procedure mix for the future. This analysis can also detect rising expenses and pinpoint exactly where, when and why the increase took place.
5. Revise instrument cleaning guidelines. No matter what type of enzymatic detergent your ASC uses to soak scopes into, Shaun Sweeney, vice president of sales and marketing for Cygnus Medical, stresses the importance of changing — not reusing — detergents after each use for optimal effectiveness. Just as a household member would refill a sink with new water and new detergent to clean dirty dishes, ASCs should also be mindful of changing water and enzymatic detergent because detergent will break down, Mr. Sweeney says.
"This may be a case of someone not paying attention to the manufacturer's recommendations or trying to save money, but ASCs must not reuse enzymatic detergent with multiple scopes. Detergents absolutely break down and lose integrity after each use," he says. "ASCs will sometimes reuse a brush to clean a scope too, but they have to remember that there are disposable kinds and reusable kinds. If you use a single-use item, you're supposed to use that item just one time."
Related Articles on ASC Turnarounds:
8 Tricks to Save More Money at Your Surgery Center
10 ASC Must-Reads From the Week of Nov. 14
8 Ways to Involve ASC Physicians in Physician Recruitment
1. Perform a compensation review. If your surgery center has never performed a compensation review, you should do one this year, says John Merski Jr., executive director of human resources for MedHQ. You may also need to perform a compensation review if you notice indicators of dissatisfaction, such as high employee turnover, complaints about salary at your annual employee reviews or comments from the staff that similar positions at other facilities are better-paid.
"Generally the question comes up because when you do exit interviews, staff members say they're leaving for a job that pays more," he says. Once you have identified a problem with your compensation, you can start talking to employees to determine where you fall short. Mr. Merski says the ASC should conduct an employee survey that determines the strengths and weaknesses of your compensation plan. For example, perhaps some employees feel fairly compensated, and others don't. Perhaps your salaries are on target, but your benefit plan is meager compared to the local hospital. When employees have completed the survey, go over their answers and identify common themes so you understand the most prevalent areas of dissatisfaction.
2. Form a relationship with a healthcare lawyer. Physicians must be aware of Stark Law and referral issues to avoid accidentally breaking the law. They must also be aware of the potential for malpractice suits and be prepared for any action that could come their way. Select a competent "health lawyer" who can guide you through any issues that might arise. They will be helpful in assessing partnership contracts, as well as regulation issues. "The physicians have to understand how the wording in a contract could increase their liability," says Pedro Vergne-Marini, MD, managing member of Physicians Capital Investments.
3. Conduct a valuation. Principle Valuation recently did a business valuation (real estate, equipment, and operations) for an ASC owned by a group of physicians. "They were considering selling to a local hospital and wanted to know the different values," says Adam Lynch of Principle Valuation. "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. This group was proactive and was able to use our information to help with their strategy."
4. Track data and analyze trends. Keeping complete records not only allows a physician to better understand the operations of a center, from expenses to case mix to cost per procedure, but also helps identify trends and opportunities for improvement.
"Understanding the importance of accounting and record keeping for any business is key," says Kristine Mighion, MD, MBA, managing director and CEO of Healthcare Consultants International and host of Intimetv.com’s Healthcare Executive show. "That tends to be an area where doctors are not as strong. They don't get tend to be exposed to those concepts, and they don't tend to think that way."
She says physicians should have their ASCs track number of patients, type and quantity of procedures, as well as total revenues and revenue per procedure. They should review the records monthly or quarterly, and look for trends from month to month, quarter to quarter, and year to year. An analysis of these metrics can inform a physician whether the center does a lot of small procedures with lower returns or fewer large procedures with bigger returns, and as a result can help a physician plan the best procedure mix for the future. This analysis can also detect rising expenses and pinpoint exactly where, when and why the increase took place.
5. Revise instrument cleaning guidelines. No matter what type of enzymatic detergent your ASC uses to soak scopes into, Shaun Sweeney, vice president of sales and marketing for Cygnus Medical, stresses the importance of changing — not reusing — detergents after each use for optimal effectiveness. Just as a household member would refill a sink with new water and new detergent to clean dirty dishes, ASCs should also be mindful of changing water and enzymatic detergent because detergent will break down, Mr. Sweeney says.
"This may be a case of someone not paying attention to the manufacturer's recommendations or trying to save money, but ASCs must not reuse enzymatic detergent with multiple scopes. Detergents absolutely break down and lose integrity after each use," he says. "ASCs will sometimes reuse a brush to clean a scope too, but they have to remember that there are disposable kinds and reusable kinds. If you use a single-use item, you're supposed to use that item just one time."
Related Articles on ASC Turnarounds:
8 Tricks to Save More Money at Your Surgery Center
10 ASC Must-Reads From the Week of Nov. 14
8 Ways to Involve ASC Physicians in Physician Recruitment