The future is now: 3 insights on the post-2020 future of ASCs

Many factors are driving migration of numerous spine and orthopedic procedures to ASCs, including cost pressures and regulatory changes.

Health systems are under pressure to align with ASCs to try to capture some of that volume.

During a June virtual session of Becker's 18th Annual Spine, Orthopedic and Pain Management-driven ASC + The Future of Spine Conference sponsored by ECG Management Consultants, four experts from ECG shared insights into these trends and considerations for all healthcare stakeholders:

  • Sean Hartzell, associate principal
  • Naya Kehayes, principal
  • Matt Kilton, associate principal
  • Matt Reigle, associate principal

Three key insights:

1. The rapid expansion of ASC procedures reflects several factors in the healthcare system. Healthcare stakeholders, including payers, employers and patients, are all focused on managing the cost of care. Patient consumerism and price transparency on the part of hospitals are giving patients tools to compare expenses. While cost consciousness is pushing payers to ASCs, physicians are looking to ASCs for efficiency and for volume to increase earnings.

Regulatory changes have also fueled massive opportunity for surgery case volume to shift to ASCs. CMS expanded the procedures on the ASC covered procedure list (CPL) in 2021, adding 267 new codes, enabling access to reimbursement by Medicare. Many commercial payers have a more robust approved CPL than CMS and have already approved these codes which gives ASCs greater access to all patients . Insurance plans are adopting site of service policies and are requiring hospitals to obtain approval for reimbursement when surgery is performed in the hospital outpatient department; "if an ASC is available, where the physicians are certified and are credentialed to work, and the ASC has the equipment to perform them, those cases are to be done in the ASC, rather than the [hospital outpatient department], and the hospital can be denied payment" Ms. Kehayes said. COVID-19 accelerated these trends. "COVID has created a scenario where payers are expediting the conversation," Mr. Kilton said. Patients welcomed ASCs as a safer environment for procedures during the peak of the pandemic.

2. Orthopedic and spine procedures are rapidly migrating to ASCs. "Medicare has closed the gap between the inpatient and the hospital outpatient reimbursement rates," Mr. Reigle said, "effectively eliminating any monetary incentive to perform a total knee replacement as an inpatient case".

Migrating high-acuity orthopedic or spine cases to ASCs involves several considerations. The top priority remains patient care, which requires appropriate staffing, including expertise and assessment of case complexity. Administrators need to fully understand the reimbursement landscape. Volume and reimbursement of new procedures are critical factors that support with an ASCs willingness to invest in technology and space requirements.

3. Hospital leaders face urgent pressures to formulate strategies for aligning with ASCs. Hospitals are squeezed from all sides — payers, physicians, patients, employers and other health systems. Accordingly, hospital executives are finding that they must explore ASC alignment through partnership or acquisition. The pressing choice is "developing and implementing an ambulatory surgery strategic plan or risk losing key volume and revenue," Mr. Hartzell said.

ASCs are becoming stronger financial competitors because of consolidation and private equity investment. "Given this new reality, health systems across the nation, as a response, are increasing their focus on incorporating ASCs into their network," Mr. Hartzell said.

To learn more about the event, click here.

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