Hospitals and health systems are increasingly investing in ASCs not only as a method for expanding surgical volumes, but as a key element of system affordability.
“We think about affordability not just being something that we state, but something that we’re truly trying to deliver on,” Dennis Butts, executive vice president and chief strategy and network development officer for Detroit-based Henry Ford Health, told Becker’s. “That’s affordability for employers, affordability for the federal government, the state, but then also ultimately the consumer. That’s something that’s critical to our overall strategy. So that means ASC growth and overall utilization is a critical component of what we’re focused on.”
The system launched a joint venture with Ascension Michigan in October 2024, bringing around 50,000 employees across more than 550 sites in the state under Henry Ford Health’s wing. With efficiency and access being key points of focus in the systems’ merger, strong partnerships with physicians have been driving Henry Ford’s ASC growth.
“What’s interesting now is just the amount of physician ownership that we see happening across the ASC landscape,” Mr. Butts said. “Whereas we look at the volumes of what we’re capturing as a system, those are definitely being impacted by not only more procedures being available to be done in an ASC setting, but also more physician ownership opportunities that’s driving that behavior, as physicians are trying to get upstream, in some of the technical revenue opportunity.”
This has resulted in a mixed bag of joint ventures and ownership models, with some of the systems’ ASCs being fully owned or on hospital campuses, while it has minority or noncontrolling stake in others.
“We’re kind of stretched across the board as far as physicians looking to us to provide the space and own it, but they’re more so partnering with us in a highly efficient operation,” Mr. Butts said. He added that Henry Ford sets itself apart in recognizing the difference between straightforward, capital partnerships and those that will truly drive growth.
“If we’re going to come to a table, I would say capital is more of a table stake, because you can get that from a hospital, you can get that from private equity. That’s not a differentiator,” he said. “But are we actually able to bring new physicians to the table that bring the right complement of cases that drives the profitability of the center? All volume isn’t necessarily good volume, and are we going to bring more than the name that brings efficiency? Can we bring growth?”
He has also seen an increase in three-way joint ventures among hospitals, ASCs and management services organizations as stakeholders have become more aware of the potential for highly efficient collaboration.
“I’ve been entertaining some of those conversations recently, where before I would say it was an either-or situation. Are you choosing a hospital, or are you choosing a management company?” he said.”There seems to be some interest in combinations of all three to get the best of all those things, as you’re looking at the next level of growth.”
