10 Challenges & Opportunities for Anesthesia in 2014

Anesthesia Business Consultants President and CEO Tony Mira discusses 10 of the biggest challenges and opportunities for anesthesiologists over the next year.

1. Healthcare consolidation. Healthcare providers are merging and acquiring each other to grow market presence and dominance. Over the past few years, health systems have acquired hospitals at an alarming rate; private practices have been purchased by these hospitals or merged into large groups; and ambulatory surgery centers are becoming wholly or jointly owned by hospitals or corporate partners.

"Consolidation is putting pressure on anesthesia specialists," says Mr. Mira. "This is creating concerns for anesthesiologists because they aren't part of the decision-making process, especially if they don't have controlling interest in the facility."

When hospitals consolidate with health systems, the health system often decides they'll manage the group and reduce or remove the stipend substantially.

2. Workforce changes. Additional changes may occur after the health system re-evaluates workflow. "The new group will evaluate the compensation and workforce allocations for those new facilities," says Mr. Mira. "The hospitals might be running one doctor for two CRNAs. Then the group will increase the CRNA numbers to four per physician. They will manipulate and adjust the workforce to maximize collections and reduce expenses."

In these situations, existing physicians may not see a dip in compensation but their workload increases, and when an anesthesiologist retires or leaves the group, the new health system will likely replace that position with a lower cost mid-level provider instead of another physician.

3. Mid-level providers. As healthcare reform seeks to lower healthcare costs, mid-level providers are increasingly able to administer anesthesia services. Several states now allow mid-level providers to administer anesthesia without a physician's supervision, and Mr. Mira only sees that trend growing.

"If an anesthesiologist's focus is OR-only, that could be a problem," says Mr. Mira. "They need to be more involved with the management of the preoperative, operative and postoperative process, that is, the whole continuum of care. You can't just be in the operating room providing services to the patient. You have to provide more benefits and create value-added services to the hospital and surgeons so they see the benefit anesthesiologists provide."

4. Creating value with hospital leaders. As more mid-level providers take over responsibilities in the OR, there is also an opportunity for anesthesiologists to partner with health systems and hospitals to develop best practices for quality and patient flow, not just in the OR but also on the floor and in the ICU.

"Unless the anesthesiologist looks at the bigger picture and considers himself a partner, it will be very difficult," says Mr. Mira. "You can't just do your case and go home. With all the changes in healthcare, with all the requirements and quality initiatives, that is going to be the trend and anesthesiologists need to really practice smarter and broader in their field."

5. OR utilization. In addition to quality statistics, anesthesiologists are seeing more demand for OR utilization and efficiency data. Mr. Mira suggests monitoring all OR suites for several weeks to find dead times, which is useful information when developing a new strategy.

"Provide that information to the hospital and then you are immediately helpful," says Mr. Mira. "If the OR is utilized fully, it's very powerful. That will show hospitals how they are using revenues and expenses in the OR and what each patients is costing them."

6. Materials costs. Anesthesiologists also have the opportunity to reduce costs with drug and instrumentation choices. Standardizing cost variation between anesthetic agents to the low cost, high quality option is another opportunity to show value to the hospital.

"You have to look at the line items and really tackle them," says Mr. Mira. "Anesthesia needs to step up to the plate and really work with the hospital to reduce expenses. If everyone in the group uses different anesthetic agents, you can track and trend to see — based on the different requirements of each anesthesiologist — what the big cost factors are. If you can figure that out you can peel the onion and reduce expenses where possible."

Anesthesiologists who are truly partnering with the hospital on cost control will be considered a valued asset. "That's job security," says Mr. Mira.

7. Accountable care organizations. Healthcare providers across the country are forming accountable care organizations designed to share risk among providers. Payers deliver one lump sum to the providers in ACOs and portions are distributed based on pre-determined ACO rates.

"We are wondering how the pie will be distributed and how anesthesia — which isn't on the front line of the decision-making process within the ACO program — will receive reimbursement," says Mr. Mira. "They are concerned with how to get the piece of the pie that justifies what we are doing."

Anesthesiologists are beginning to gather more data and track outcomes to justify their payment within these new models. Granular information about the types of patients, cases and surgeons anesthesiologists serve will help them negotiate their piece of the pie.

8. Data gathering. The age of big data has arrived in healthcare and anesthesiologists are using this information as negotiating chips when sitting down with payers and others specialists to determine appropriate compensation.

"I hope anesthesiologists and groups are data mining so they are able to have good information when they sit down at the table with the rest of the specialists and hospitals to negotiate their compensation," says Mr. Mira. "If you don't have data, you're lost in the discussion. It's also important to have the data on hand when you sit down with insurance companies and make sure your data is better and more accurate than anyone else's."

Packaging this data appropriately helps build the case around the critical nature of the anesthesiologist's role in care delivery.

9. Medicare and Medicaid payments. The instability in Washington over whether the government will shut down — and trigger a 24 percent cut in Medicare rates — makes it difficult for physicians to budget for the future. At the same time, the Medicaid population is growing due to the individual mandate, and self-pay has increased.

"Increasing the dollars from self-pay patients requires more activity and resources," says Mr. Mira. "That's an issue with the new healthcare plan."

10. Health insurance exchanges. As more people enroll in the health insurance exchanges, reimbursement rates will be lower and the payment process will likely be slower.

"Even though people predicted there would be up to 30 million more people having insurance, the impact of that will have an effect on providers because those patients are lower paying patients and the length of time to collect those dollars is much longer," says Mr. Mira. "Groups need additional staffing to handle the care, process and service the patient. Getting reimbursed will be an issue, which is something that really keeps anesthesiologists up at night."

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