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5 Most Interesting ASC Issues: Susan Kizirian of Physician Partners of America

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It's a jungle out there. Being an ASC stakeholder means being part of a constantly shifting landscape, negotiating changing rates, hospital partners, shifting caseloads, physician recruitment and more. Only the fittest survive.

It's a predicament of which Susan Kizirian, RN, MBA, COO of Physician Partners of America is acutely aware. With more than two decades of experience in ASC operations, she is a past and current member of several ASC organizations, and she has worked in several positions, including as a consultant, director and developer of ASCs.

Here, Ms. Kizirian draws upon her considerable experience in the ASC industry to share observations on what she perceives to be the most interesting issues for ASCs today. Her top five issues of note include:

1. Increased complexity has developed in negotiations over optimal payer contracts. "It requires a high level of expertise to negotiate an optimal contract and to be assured one got the best deal possible at that moment in time. Also, the insured are experiencing higher deductibles, copays, coinsurances — in short an increasingly larger patient out of pocket responsibility. These trends are resulting in declining net revenue per case. The threat of liability of 'never events' provisions in contracting is another aspect of this, which already holds true for hospitals," says Ms. Kizirian. Contract negotiation is further complicated by changes in ideas from multiple stakeholders — the government, physician owners and patients — about what it means to fairly compensate an ASC for its services (Could ASCs Lose Their Competitive Pricing Advantage?).

2. ASCs are adding higher acuity cases without adding an overnight stay. "[We are] seeing total joints and multilevel spine fusions done in ASCs without overnight stay," says Ms. Kizirian. "Part of safety and efficacy of higher acuity cases without overnight stay is patient selection. The other part is coordination of care after discharge." The trend toward adding higher acuity cases is also evident in both openings of ASCs with 23-hour stays (Summit Orthopaedics Opens ASC With 23-Hour Stays) and in legislation passed lengthening the amount of time ASCs may keep patients, including a recent bill in Florida (Florida House Passes Bill Allowing 24 Hour Stays at ASCs).

3. ASCs are finding partners over going it alone. "ASCs are increasingly joining integrated provider networks and care systems, such as hospitals, health systems or large multispecialty groups, rather than standing alone," says Ms. Kizirian. Taking on partners helps centers to secure case volumes sufficient for profitability (11 Things to Know About ASCs in 2014).

4. Physician employment is on the rise, while fewer physicians are partnering with ASCs. "The increasing decline in the number of surgeons looking to partner with ASCs and increasing surgeon employment with hospital systems or other health entities is attributable to surgeon desire to maintain a referral network," says Ms. Kizirian. "With the increase in employment of primary care practices by hospitals, frequently surgeons are under pressure to schedule cases at hospitals to maintain the integrity of their referral network." According to VMG Health, this issue is one ASC companies feel is a major threat to case volume growth (4 Threats to ASC Case Volume Growth).

5. Out-of-network benefits are decreasing. "There has been an increasing decline in out-of-network benefits, often during mid-plan year. If that out-of-network payer revenue was significant, the ASC can find itself upside down rapidly," says Ms. Kizirian. This trend is not without scrutiny; the sentiments to ASCs' rights to out-of-network reimbursement are uncertain, given the current climate healthcare and the emphasis on value in care (8 Key thoughts for ASCs on Out-of-Network Services).

Of the issues, Ms. Kizirian finds none particularly surprising. However, she is excited about ASCs' ability to accept higher acuity cases while offering lower infection rates than hospitals and equivalent or improved outcomes. "In addition, [patients] can return to the comfort of their homes to recover, with a postoperative program of outpatient visits to appropriate healthcare providers," says Ms. Kizirian.

She warns ASCs to be aware of the mounting power of consumerism in shaping the future of outpatient surgery: "As out of pocket responsibility rises, patients will be looking for the low cost provider with high quality and a great patient experience. Positioning the ASC as patients and insurers begin the journey of looking for price transparency needs to start now," she adds.

More Articles on Turnarounds:
How ASCs are Navigating ACO Terrain & 8 Tips to Mitigate Risk
5 Insights From ASC Leaders for 2014
Engaging Surgeons: A How-To Guide

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