How physician pay cuts could affect ASCs

With CMS' potential 4.42 percent physician fee cut looming, that decision likely will have implications in the ASC industry.

Five ASC and healthcare leaders connected with Becker's to answer: "How is declining physician pay affecting the ASC industry?"

Editor's note: Response has been lightly edited for length and clarity.

Sandy Berreth, RN. Medicare Surveyor at the Accreditation Association for Ambulatory Health Care: I'm not sure it is. Declining physicians' pay may lead to more physician/hospital employment. However, the key for our industry to succeed is the ASC industry itself. Payers are starting to realize and promote ASC services. Therefore, healthcare organizations big and small are going to need to develop relationships or partnerships with existing ASCs or build their own.

The ASC industry shouldn't suffer. Will private ownership of ASCs by physicians decline? That's a possibility, but ASCs have the key for the future of surgical service healthcare. ASCs deliver the highest quality of care, close to zero percent infection rates, friendly services and reduced cost of care. The cost to the patient is reduced, which is most important in a recession.

The answer is there is only one way the ASC industry is heading and that's forward; it has very little to do with the physicians and everything to do with the payers. The payers are the drivers.

Jodi Brooks, MSN, RN. Regional Director for FlexEd: From my conversations with physicians, the impact will be felt in the years to come. Physicians discourage interested students from joining the profession and especially from practicing in states like California with high tax rates. Many would-be doctors are choosing to go into different professions where they don't have to dedicate as many years or financial resources to complete their education. This will create a larger shortage of primary care physicians and any other specialty that doesn't pay as well.

Nicholas Morse. Chief Marketing Officer at Nadora Healthcare (Johnstown, Colo): It can make it difficult to recruit surgeons if you're not in a large group or if you're in a market that is dominated by health systems. Fortunately for us, we've become a destination center for medical tourism and we've been able to supplement surgeon pay through additional cases that come to us outside of insurance and Medicare and Medicaid. Being able to think differently and creatively to recruit surgeons is key. Otherwise it's going to be very difficult for ASCs without a large equity partner to continue to exist.

Maxim Sheinman. Director of Business Development Hospital Corp. of America: I believe these are the factors that will affect the ASC industry with declining reimbursements:

Declining reimbursement will lead to additional physician employment by larger health systems. Will also cause declining quality and availability of physician services. More physicians will become employed and will perform less cases in an ASC setting. We will continue to see the consolidation and corporatization of medical practices. More physicians will seek employment in private equity-backed corporations for stable income. Finally, the standard of medicine in this country will continue to decline.

Rob Taylor, RN. Clinical Director and Total Joint Coordinator at Constitution Surgical Center East (Waterford, Conn.): Declining physician pay is forcing providers to seek out additional means of income. This is helping to create growth potential for ASCs. For providers, performing surgery in an ASC generates an income stream separate from one's practice or hospital obligations. For an ASC, more providers equal more scheduled cases. More scheduled cases equal more revenue. Providers with the opportunity to invest in the ASC's ownership structure further strengthens their return on investment and the overall financial stability of the ASC.

ASCs present a viable option for providers to invest in their future. Hospitals have recognized this too, as seen in their continued efforts to participate in ASCs, often through joint ventures. Healthcare is ever changing and through continued efficiency and productivity, ASCs have truly earned their place at the table.

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