ASCs in hot water: 7 notes on reimbursements

From operating costs to orthopedic cases, seven ASC leaders joined Becker's to discuss their biggest issues with reimbursement. 

Question: What are your biggest issues regarding reimbursements this year?

Editor's note: These responses were edited lightly for brevity and clarity. 

Paula Autry. CEO of Leadership DNAmics. Healthcare reimbursement is moving to value-based models. Effective value-based models will require partnership with physicians and health providers in the service area. In addition, systems need accurate data analysis to ensure accountability. There will be a focus on ensuring that care is provided in the most efficient and effective environment. As a result, there will likely be movement away from inpatient care, when appropriate. This could result in less investment in new hospital projects, in favor of more outpatient services, particularly when there are sufficient inpatient beds in the service area.  Lastly, organizations with high overhead and administrative costs will likely struggle to be financially viable. This should encourage investment in front-line staff and discourage growth and elevation of executive team compensation. My biggest concern about reimbursement is with states that have not expanded Medicaid. In doing so, they are not allowing the most vulnerable communities to have access to preventive care that can reduce costs of procedural based services. In addition, by not expanding Medicaid, they are placing financial burdens on already-challenged health systems.

Brenda Carter. Administrator of Wilmington (N.C.) Surgcare. As always, there is great concern over reimbursements. They continue to decline while facilities are challenged to provide higher and more advanced levels of services, which come at a higher per case cost. ASCs must manage to the penny to be able to provide services, attract talent and retain staff in the most expensive, competitive market in recent history. It seems that this burden has shifted solely to the facility. Suppliers are not restricted on pricing, and insurance companies don’t share the burden by increasing reimbursement rates for providing services. The equation seems unfairly tipped. At some point, the private industries and the suppliers that we need to operate will need to partner with us and adjust for these constraints, or ASCs will find it unsustainable.

Stephanie Conquest. Administrator of Vanderbilt Surgery Center Cool Springs (Franklin, Tenn.): My biggest concerns regarding ASC reimbursements right now are payers keeping up with inflation and higher CMS payment rates to HOPDs vs ASCs.

Mark Mineo. Director of the Millard Fillmore Surgery Center (Williamsville, N.Y.): Commercial payers no longer paying for "carve outs."

Craig Sarine. Former CEO of University Surgical Associates (Chattanooga, Tenn.): We are in a strategic position, and a part of the country where we have not seen appreciable decreases in reimbursement, other than the droning (death by a thousand) Medicare cuts. However, more noteworthy than these minor, in relative terms, "death cuts" are the comparative gouges resulting from rapidly rising costs of operation. Every business needs to have an operating margin to survive (save for a major cash reserve, of course). All providers are suffering right now, granted to varying degrees, with relatively fixed revenues and burgeoning expenses, largely in payroll. So my biggest concern is that reimbursement is not keeping up with cost increases and instead is shrinking back. In an ASC, it means lower distributions for owners – in a physician practice, it means lower salaries for the providers. It is simply not sustainable in the long term.

Marietha Silvers, RN. Administrator of The Surgery Center of Cleveland (Tenn.): Decrease in reimbursements in high implant procedures.

Matthew Solis. Director of Downtown Surgery Center (Orlando, Fla.): For my center, which is very heavy with orthopedic cases, it’s making sure we have enough to cover the cost of implants. Just as with the rest of the world, my vendors are needing to raise pricing and it feels as though the payers are not following suit. They are still saving money by having the patients come to an ASC, so you would hope to see some give their part.

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