Can Ambulatory Surgery Centers Survive Healthcare Reform? Q&A With Kim White
Kim White, MDA, a consultant with Numerof & Associates discusses how ambulatory surgery centers can maintain a thriving business under the changes coming from healthcare reform.
Q: Can ambulatory surgery centers survive ObamaCare?
Kim White: Absolutely, however, I would say success is not a given. Healthcare is an evolving and dynamic marketplace. Going forward, ASCs are going to need to do three things to really survive: demonstrate economic and clinical value, demonstrate efficiencies and meet quality standards.
The goal of the Patient Protection and Affordable Care Act is to increase access to care, provide better outcomes and lower costs. Organizations like ASCs can do that very effectively. In order for care to be directed toward or selected from their location, ASCs will need the data to demonstrate why they are the right choice. You have to show why your ASC is different and a more sustainable option than other care settings.
Q: What opportunities do ASCs have to really be successful in the future?
KW: ASC leaders must rethink their processes and procedures to optimize the opportunities they have. ASCs were established to provide efficient, low-cost care and will continue to find a way to do that. They must find a way to create differential value in the minds of consumers, and payers who decide whether or not to reimburse for consumers at their location.
It's more than just efficiency; it's providing real economic and clinical value. Be aware of other providers in the market and how they define their care path, treatment and outcomes. Are you capturing that information today? If not, you must do so. You want to guarantee a certain experience and outcome for patients with "X" percent certainty. Identify who the outliers are, but know what the standard case looks like so you can help employers and payers understand what to expect from the ASC.
Q: How will consolidation in today's healthcare industry impact ambulatory surgery centers?
KW: I think consolidation will have a big impact on ASCs, depending on the market. ASCs must be aware of what is happening in their marketplace and whether consolidation is occurring. Additionally, ASCs must consider whether payers in the market are moving toward risk-based payments. It's important to understand within your service areas how you provide care pathways for patients and whether your center fits into these new partnerships and payment methods.
Q: Will ASCs be forced to merge or enter into a partnership with other institutions to keep their business running?
KW: Healthcare delivery institutions must now rethink their business models, and there could be opportunities for new partnerships. It can be a simple agreement that the physicians or surgery center will provide services for a hospital because the hospital isn't cost-effective in some areas.
Additionally, payers and employers are trying to understand cost structures and who provides care that is valuable to them. They are looking at the total package of what providers are offering: economic and clinical value. It's not just about the price, it's also about the associated outcomes. If an ASC can help a hospital with achieving outcomes, this can be an opportunity.
Q: Health insurance exchanges are a major part of ObamaCare and will be implemented in the coming year. How will they impact ASCs? Are there other insurance trends centers should know about?
KW: There are a number of things they can do, but you have to look at your strategies market-by-market. Are the health insurance exchanges government-run or privately-run, or is it a combination? The essential health benefits define specific services that are covered and some states will extend those benefits. Is there an opportunity for the ASC to fit within the exchange in some way? Do we need to partner with someone who is selling plans on the exchange?
We also have to look at trends in high-deductible health plans. Since consumers will think more and more about the services they seek, consider the expenses they have to pay and the value they'll get in return. ASCs should develop a good relationship with consumers and communicate with them so they understand the value of care. Tell them what type of service they'll receive at the ASC and the types of outcomes they can bank on.
This package might not be the same as what the ASC puts together for the payer because they need to take a strategic marketing approach that really relates to consumers.
Q: What can ASC owners and administrators do today to position themselves for success in the future?
KW: Overall, PPACA presents ASCs with opportunities. The challenge is quantifying those opportunities and being disciplined in their approach. They need to make strategic decisions in where they are going to play and then be disciplined in capturing data to substantiate their differentiation.
Electronic medical records are becoming more critical, but they aren't helpful unless the ASC leaders understand their data. Even for those adopting EMR we advise they develop a strategy for what data to collect and make sure processes and systems will be able to deliver that data going forward. The big data push is sometimes overbearing, so finding the right data to make good real-time decisions is crucial.
© Copyright ASC COMMUNICATIONS 2015. Interested in LINKING to or REPRINTING this content? View our policies by clicking here.
New From Becker's ASC Review
Surgery Partners to file IPO, Laser Spine Institute adds Dr. Reginald Davis, Tenet considers $6.7M surgery center project & more –7 recent ASC company key notesRead Now
- Succeed as a new manager: 5 tips
- How to turn ASC staffing from a cost-center into a value center — 8 key steps
- Healthcare services M&A: 10 key trends
- AAOS selects Medline Industries as distribution partner
- Did the ASC industry end the year with a bang or a bust? 50 things to know about 4Q, year-end financial results