Here are five observations on the changing healthcare marketplace and how ambulatory surgery centers fit in from Dawn McLane-Onofrio, vice president, consulting, development and integration with Health Inventures.
1. Fewer surgeons in the marketplace. Hospitals have been extending more employment contracts to specialists than in the past, and surgeons are accepting them. This is a troubling trend for ASCs that depend on independent physicians in the community because when they are employed, the hospital may no longer allow them to perform cases at the ASC.
"Across the country over the past few years, as I've begun to work with more hospitals and systems that have employed surgeons, in many cases the surgeons are already members of a joint venture surgery center and the hospital has to decide whether they can keep membership or sell," says Ms. McLane-Onofrio. "I've seen all scenarios. There are some who don't allow surgeons to perform cases at the ASC, others who will allow them to do cases there but not be owners and still others who allow ownership in outside ASCs. I've seen a little bit of everything."
2. More opportunity for hospital partnerships. Hospitals and health systems are looking for low-cost, outpatient surgical center partners. In the past, hospitals may have considered local surgery centers competition but changing incentives in the marketplace may breed mutually beneficial partnerships. Hospital partnerships or joint ventures could be beneficial in achieving good rates. However, consider how the partnership will impact surgical volume and physician participation in the center.
"Take into consideration the hospital's policy on employed physicians performing cases at the ASC," says Ms. McLane-Onofrio. "If the hospital decides employed physicians can't perform cases at the center, it takes physicians out of the market that could become owners at the joint venture ASC."
3. ASC profitability is in limbo. When hospitals employ surgeons and forbid them from bringing cases to the ASC, or ask owners to divest their shares before becoming a hospital employee, volume at the center and subsequent profitability will take a hit.
"That will impact distribution to the owners and profitability of the center," says Ms. McLane. "There's a pro forma that the surgeons bought into when they signed on at the center and if you take surgeons out of the mix, it will adversely impact the center. You may need to lay off employees or take other cost cutting measures because you don't have the case volume to support the original or projected needs at the center."
ASC administrators must continue looking at their performance and figure out how to optimize and increase patient volume despite fewer surgeons bringing cases to the center.
4. Accountable care organizations coming. ACOs are sprouting up in markets across the country and providers can no longer afford to ignore the trend. Physicians and hospitals in some markets may be friendly to ASC participation; others could be more hostile. Either way, ASC leaders must take a seat at the table for these discussions and figure out how their facility will fit into the new healthcare environment.
"It becomes more important than ever as an ASC administrator not to exist in a silo," says Ms. McLane. "I think the administrators, board members and owners should plug into the community around them so they have relationships with hospitals and other providers. As things like ACOs begin to develop across the country, people will be looking for members of the ACO and if you have an existing relationship with other providers you could be part of that ACO and still remain independent."
Both private payors and Medicare have been developing ACOs with providers, and some iteration of shared savings will likely continue to develop in the future.
"Do a cost analysis and be the provider with the best report card in town," says Ms. McLane. "That makes you most attractive if there does come a time when people are looking for an outpatient surgery option. They'll want to include the provider with the best report card in the ACO, so you'll be most sought after."
5. Attracting new physicians is now continuous. With more providers becoming hospital employees, it becomes increasingly important for ASCs to develop a relationship with independent providers and bring new cases and specialties into the center. Attract new physicians who are searching for positive cost and quality options for their patients.
"Patients are looking for the best of the best with low cost and high quality," says Ms. McLane. "Pay attention to everything — your licensure, accreditation, quality studies — and stay on top of them. Marketing is an ongoing issue and you should continuously be out in the community. Pay attention to the new surgeons coming into town and approach them early in the game."
More Articles on Surgery Centers:
7 Steps for ASCs to Ensure Accreditation Survey Readiness
5 Tactics to Attract New Physicians to ASCs
5 Strategies to Enhance ASC Patient Volume
1. Fewer surgeons in the marketplace. Hospitals have been extending more employment contracts to specialists than in the past, and surgeons are accepting them. This is a troubling trend for ASCs that depend on independent physicians in the community because when they are employed, the hospital may no longer allow them to perform cases at the ASC.
"Across the country over the past few years, as I've begun to work with more hospitals and systems that have employed surgeons, in many cases the surgeons are already members of a joint venture surgery center and the hospital has to decide whether they can keep membership or sell," says Ms. McLane-Onofrio. "I've seen all scenarios. There are some who don't allow surgeons to perform cases at the ASC, others who will allow them to do cases there but not be owners and still others who allow ownership in outside ASCs. I've seen a little bit of everything."
2. More opportunity for hospital partnerships. Hospitals and health systems are looking for low-cost, outpatient surgical center partners. In the past, hospitals may have considered local surgery centers competition but changing incentives in the marketplace may breed mutually beneficial partnerships. Hospital partnerships or joint ventures could be beneficial in achieving good rates. However, consider how the partnership will impact surgical volume and physician participation in the center.
"Take into consideration the hospital's policy on employed physicians performing cases at the ASC," says Ms. McLane-Onofrio. "If the hospital decides employed physicians can't perform cases at the center, it takes physicians out of the market that could become owners at the joint venture ASC."
3. ASC profitability is in limbo. When hospitals employ surgeons and forbid them from bringing cases to the ASC, or ask owners to divest their shares before becoming a hospital employee, volume at the center and subsequent profitability will take a hit.
"That will impact distribution to the owners and profitability of the center," says Ms. McLane. "There's a pro forma that the surgeons bought into when they signed on at the center and if you take surgeons out of the mix, it will adversely impact the center. You may need to lay off employees or take other cost cutting measures because you don't have the case volume to support the original or projected needs at the center."
ASC administrators must continue looking at their performance and figure out how to optimize and increase patient volume despite fewer surgeons bringing cases to the center.
4. Accountable care organizations coming. ACOs are sprouting up in markets across the country and providers can no longer afford to ignore the trend. Physicians and hospitals in some markets may be friendly to ASC participation; others could be more hostile. Either way, ASC leaders must take a seat at the table for these discussions and figure out how their facility will fit into the new healthcare environment.
"It becomes more important than ever as an ASC administrator not to exist in a silo," says Ms. McLane. "I think the administrators, board members and owners should plug into the community around them so they have relationships with hospitals and other providers. As things like ACOs begin to develop across the country, people will be looking for members of the ACO and if you have an existing relationship with other providers you could be part of that ACO and still remain independent."
Both private payors and Medicare have been developing ACOs with providers, and some iteration of shared savings will likely continue to develop in the future.
"Do a cost analysis and be the provider with the best report card in town," says Ms. McLane. "That makes you most attractive if there does come a time when people are looking for an outpatient surgery option. They'll want to include the provider with the best report card in the ACO, so you'll be most sought after."
5. Attracting new physicians is now continuous. With more providers becoming hospital employees, it becomes increasingly important for ASCs to develop a relationship with independent providers and bring new cases and specialties into the center. Attract new physicians who are searching for positive cost and quality options for their patients.
"Patients are looking for the best of the best with low cost and high quality," says Ms. McLane. "Pay attention to everything — your licensure, accreditation, quality studies — and stay on top of them. Marketing is an ongoing issue and you should continuously be out in the community. Pay attention to the new surgeons coming into town and approach them early in the game."
More Articles on Surgery Centers:
7 Steps for ASCs to Ensure Accreditation Survey Readiness
5 Tactics to Attract New Physicians to ASCs
5 Strategies to Enhance ASC Patient Volume