Need Profits? Baby Boomers to Bring Influx of Orthopedic Cases
At the 20th Annual Ambulatory Surgery Centers Conference in Chicago on Oct. 24, Larry Taylor, president and CEO of Practice Partners in Healthcare, discussed how to maintain surgery center profitability through a profitable orthopedic service line.
What is the secret behind the orthopedic service line’s potential? Baby Boomers. “Every seven seconds someone turns 50,” he said. And what do most 50-plus year olds need? Orthopedic care.
Mr. Taylor cited a few statistics on America’s aging population:
- By 2015, those aged 50 and over will represent 45 percent of total U.S. population.
- The number of people aged 65 and older will increase by 53 percent between 2001 and 2002.
- Sixty percent of people over 65 have arthritis.
- Total knee replacements will increase an estimated 673 percent by 2030, and total hip replacements will increase by 175 percent.
Plus, Baby Boomer’s don’t exactly treat their bodies cautiously. “Who here has run a half marathon? A marathon?” he asked, pointing out that while widely popular among Boomers, long distance races harm joints and will further drive this population to orthopedists.
Orthopedic cases, because of their complexity, pay comparatively well, and can help counteract the reimbursement pressures currently facing centers.
ASCs receive approximately half the reimbursement that hospitals receive for the same procedure, at least for Medicare. For 2014, ASCs will receive a 0.9 reimbursement adjustment, while hospital outpatient departments will get 1.8 percent.
To drive orthopedic profitability, ASC leaders need to attract orthopedic surgeons, especially younger ones, who are not nearing retirement, and work to reduce orthopedic supply costs through standardization and vendor agreements.
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