Two ASC leaders discussed what makes the Northeast market unique and how surgery centers can thrive in the region.
Prashanth Bala, vice president of ASC operations at Shields Health Care Group in Quincy, Mass. and Jeffrey Flynn, administrator and COO of Gramercy Surgery Center in New York City spoke with Becker's about the state of the Northeastern ASC market.
Editor's note: This piece was edited lightly for brevity and clarity.
Question: How does the ASC industry in the Northeast market differ from other markets in the country?
Prashanth Bala: The New England market for ASCs is a little bit of a mixed bag. Most of the New England states have a certificate of need or determination of need requirement to open an ASC. Though this is not different from some other markets nationally, the regulations have led to fewer ASCs per capita than anywhere else in the country. Additionally, most commercial payers are still learning the clinical and economic benefits of ASCs for patients. The payer landscape is restricted with a number of the national payers having limited covered lives in the area.
Jeffrey Flynn: I think it is fair to say that the ASC industry in the northeast differs more in a state-to-state situation. For instance, New York only has 157 ASCs in a population of 20 million in the state. This differs vastly from New Jersey which has more than 300 surgery centers with a population of 9 million. Specifically in New York, we are a tough certificate of need state where hospitals dominate the processes of licensing. Since the COVID-19 pandemic began it is getting easier, but is still a difficult and lengthy process.
Q: What are some of the biggest threats to ASCs in your market?
PB: This market is dominated by extraordinary hospital care. As a result, very few procedures were performed in freestanding ASCs prior to 2018. Shields Healthcare Group has continued to partner with some of the great area hospitals to introduce the outpatient option for their patients and providers. As a result, patients are able to access the same high quality care but at a lower cost.
JF: The biggest threat we are facing now is staffing. There are nursing shortages throughout the Northeast and that is something we are all facing. The hospitals are using the federal grants given to them for COVID-19 relief to pay out large sign-on bonuses which we cannot compete with. We must promote our centers as nonbureaucratic friendly work environments.
The other big threat coming down the road can also be seen as an opportunity. Technology is key as we toward an outcome-based payment structure from the traditional fee-for-service. Many payers are approaching us about bundles and outcome data. Most concerning to me as the vice president of the New York State Association of Ambulatory Surgery Centers is that more than one-third of the centers in New York do not have electronic medical records. Without this it will be very difficult to track outcomes and can have a very detrimental effect on their future payment structures. However, those centers that are thinking of this now and implementing the technology to track outcomes will benefit greatly as this new payment model takes place.
Q: What does it take for ASCs to be successful in the Northeast market?
PB: In New England, strong partners are key for success. Shields has a track record for fostering strong partnerships with hospitals, physicians and our medical device colleagues. We strive to always ensure we are delivering the highest quality care and we know we can't do that without our partners. Once inside our facility, success is achieved with a strong organizational culture that prioritizes our people and the quality of care they provide.
JF: The center's team must always be concerned about the surgeon's and patient's experience. If you provide not only a safe and technology advanced setting but one that makes the patient comfortable and the surgeon happy to be there you have attained most of what you want to accomplish. You also must stay aware of payment and regulatory issues you will be facing and be proactive to the changes not reactive. Join your state associations as they are inexpensive key resources for you.