The Economics of Spine & ASCs: 6 Trends to Follow
1. ASC industry's rising star. Low-cost, high-quality care has been a hallmark of the ASC industry since its inception, but these qualities are becoming even more important as healthcare stakeholders seek cost savings and excellent outcomes. "Overall, the star is continuing to rise for the ASC industry," said Barry Tanner, CEO of Physicians Endoscopy. To maintain relevance in success in the current market, ASC leaders will need to tackle issues such as bundled payments and narrow networks.
2. Devices and outpatient spine. The spine device sector is a significant portion of the overall spine surgery market and it continues to grow. "The stenosis market will double in the next few years," said Hallett Matthews, MD, MBA, executive vice president and CMO of Paradigm Spine. As payment models shift toward value over cost, many spine procedures will shift from the inpatient setting to the outpatient. The device market will continue to meet the demand for minimally invasive options for outpatient spine.
Though this shift may cause a decline inpatient spine volume, there will always be inpatient cases, said John Peloza, MD, director of the Center for Spine Care. Large deformity cases and patients with significant co-morbidities will remain in the hospital.
3. ACOs and narrow networks. Accountable care organizations and narrow networks are continuing to grow in markets across the country. Dr. Peloza's ASC was operating largely on out-of-network volume, a strategy that was ultimately not successful. ACOs are popping up in his market as well. The ASC is now partnered with a hospital and focused on demonstrating the value a surgery center can offer. "We are looking to be in a position where we cannot be excluded from any network," said Dr. Peloza. Strategy will vary from market to market, but one thing remains the same: no ASC leader or surgeon can ignore the growth of ACOs and new networks.
4. Price transparency and marketing. Demand for price transparency is widespread. Patients are calling for it and some states are even enacting legislation that will require hospitals and ambulatory surgery centers to release cost information. "Our mantra in the ASC industry for years was 'Surgeons are our clients,'" said Nap Gary, COO of Regent Surgical Health. "The questions we need to be asking ourselves: do we need to rethink who the client is? Should we focus on direct-to-consumer marketing?" High deductibles are a new norm and patients are actively embracing consumerism when it comes to healthcare. The providers that cater to that tendency will capture the most cases and revenue.
5. Partnerships. Consolidation in healthcare is huge. Whether through new hospital partnerships or large employer agreements, providers are finding that strategic alliances are key. "Reach out, be aggressive and know how to state your case," said Mr. Gary.
6. Data collection. Whether for a spine practice or an ASC, data is an invaluable tool. "You have to have a reputation of proven excellence," said Dr. Peloza. "If you don't have outcomes, you have nothing." Collected and analyzed data can be used as leverage to gain entry to ACOs and narrow networks, to negotiate payer contracts and make new partnerships.
More Articles on ASC Issues:
12 Things to Know About Spine & Higher Acuity Cases in ASCs
Finding the Best Hospital Partner for Your ASC
Improving Profits in ASCs: 3 Departmental Strategies
© Copyright ASC COMMUNICATIONS 2016. Interested in LINKING to or REPRINTING this content? View our policies by clicking here.
To receive the latest hospital and health system business and legal news and analysis from Becker's Hospital Review, sign-up for the free Becker's Hospital Review E-weekly by clicking here.
- Zacks weighs in on Tenet shares — 3 notes
- 4 key points on NYU Langone Medical Center & Winthrop-University Hospital's affiliation & their growing ASC network
- Top 10 states with the highest HIV diagnoses rates
- 5 things to know about the new healthcare scam linked to the ACA
- Auditors claim Obama administration illegally distributed payments to payers under ACA reinsurance program — 5 key points