4 Top Cost Reduction Strategies for Surgery Centers

The following article is written by Barry R. Denny, CFA, OPA-C, founder and president of Expense Management Network.

 
Over the past five years, reimbursements have declined while costs have steadily risen. There is no indication this trend will slow over the next five years. Cost containment is critical in order for ambulatory surgery centers to remain viable. While there is no magic bullet to begin to ease the pain felt with the rising costs and declining reimbursements, these four top strategies will immediately impact the bottom line. Imagine peeling an onion and let’s examine the outermost layers.

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1. Maximize your GPO utilization. We have yet to work with an ASC that is taking advantage of all of the contracts and discounts available to them. This can be a very complicated, cumbersome and time consuming task but it is worth putting in the time to explore all of the options and opportunities your GPO partner offers.

 

2. Consolidate vendors. We advise our clients to consolidate as much as possible to your main medical supply vendor. This reduces administrative costs, shipping costs and overall hassle. There are only a few medical/surgical supply items that have to be purchased directly from the manufacturer. Did you know that you can get most if not all of your office and janitorial supplies from your primary medical distributor?

 

3. Limit the amount of purchase orders created. This reduces administrative costs, shipping costs, duplicate ordering and overall hassle. The estimated cost to produce a purchase order is approximately $100. It is not unusual for us to observe some ASCs placing multiple orders per day with the same vendor. Implement a simple system so everyone can communicate what supplies need to be ordered. Dry erase board or logbooks work great. Free shipping is becoming a thing of the past.


4. Use generics and private labels. Many GPOs and medical distributors offer their own generic private labels for common items such as gloves, gauze, tape and bandages. Also, while obvious, don’t forget to use generics for pharmaceuticals. Good examples are Propofol instead of Diprivan, Meperidine instead of Demerol, Ondansetron instead of Zofran and Glycopyrrolate instead of Robinul.

 

Learn more about www.emn2save.com.


Related Articles on ASC Cost Savings:

6 Key Ways to Save on ASC Supplies

6 Supply Chain Mistakes That Drain an ASC’s Budget

10 Ways to Decrease Costs in an Orthopedic-Driven Surgery Center

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