The future of spine and ASCs: 5 trends to watch

From physician income to super groups, two industry leaders discussed emerging trends in spine and ASCs at the Becker's ASC 23rd Annual Meeting in Chicago.

The panel included Sev Hrywnak, MD, CEO of the SEV Group, and Chris Bishop, CEO of Regent Surgical Health, and was moderated by Barton Walker, JD, partner at McGuirewoods.

Here are five trends to watch, based on the panel discussion.

1. Bundled payments. Value-based care and bundled payments are the buzzword of the moment and are the next frontier in spine surgery, according to Mr. Bishop. Empowering physicians with performance and cost data and linking it to pay aligns incentives on both cost and quality. This structure puts physicians at risk financially, positioning them to consider the payer's perspective while delivering care. "When the physician is properly incentivized you will see some changing in how we treat patients," he said.

2. Hospital acquisitions. "Hospitals are going to be phased out in the next five to 10 years and will just be used for trauma and acute care," Dr. Hrywnak predicted. Smart hospitals are snapping up surgery centers he said, because the hospitals will not be equipped to handle the overhead for spinal procedures as deductibles continue to rise.

3. Super groups. Mr. Bishop believes the Medicare Access and CHIP Reauthorization Act, which will take effect in 2017 for payments starting in 2019, will drive consolidation in the physician market because it marks the first large-scale effort to tie physician payments to quality measures. Tracking those measures requires significant overhead and business savvy, which many small-scale physicians' offices may not have. "If you are a two-man or -lady practice, it's difficult to have the resources to meet a lot of these regulatory standards," he said. In particular, he expects to see growth in "super groups," or extremely large groups and multistate groups, which are already forming in anesthesia and for hospitalists.

4. Physician incomes. The market will drive physician incomes down, according to Dr. Hrywnak. He suggested a neurosurgeon who makes $750,000 annually now will be making $250,000 in 10 years because "you can't constantly keep reducing reimbursement rates, but that's what they are doing," Dr. Hrywnak said. The market drives prices, and the market is controlled by payers and CMS, he added. Paraphrasing the CEO of UnitedHealthcare, Dr. Hrywnak said the goal among payers is the following: "We only have one person we have to control to make it all work — the surgeon. … We have to change their lifestyle totally. Their lifestyle is X. We have to bring it down to Y. If we can convince them Y is good, it will work."

However, Mr. Bishop disagreed that physicians will continue to see declining income on a large scale basis. He instead believes costs will be cut out in other ways, such as direct partnerships between employers and health systems, which allow health systems to treat large volumes of patients in the highest quality settings with the lowest expenses.

5. Patients have the power. "The ultimate payer is going to be the patient, believe it or not," said Dr. Hrywnak. He pointed to a pilot program at Danville, Pa.-based Geisinger Health System. This program queries patients through an app on their mobile devices any time they visit a Geisinger hospital or surgical group. At the end of the survey, if a patient has indicated they did not receive top-quality care it asks them if they want a refund. According to Dr. Hrywnak, this program is a look at what's to come, particularly when MACRA is in full force because some elements of the law incorporate patient satisfaction surveys. The bottom line is "it's all about the patients," he said, and they will ultimately determine how much a physician gets paid.

 

More articles on turnarounds:

4 key thoughts on ASC valuations
3 key topics for orthopedics, ophthalmology and GI: 3 leaders weigh in
5 RCM benchmarks for ASCs to know and improve upon

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