Six ASC administrators and executives discuss the top challenges facing their centers today and steps they're taking to build a strong foundation for the future.
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Alfonso del Granado. Administrator of Ashton Center for Day Surgery (Hoffman Estates, Ill.): While there are many challenges today, the largest single issue we are facing is the erosion of independent practitioners as large groups acquire practices or recruit surgeons straight out of residency. Large groups tend to lock their practitioners into either hospitals or group-owned ASCs, making it more difficult to recruit them to our independent centers. The approach we are focusing on is finding solo or small groups of practitioners who are interested in partnership opportunities and would make a good fit — not an easy proposition.
Too many surgeons have unrealistic ideas of the value of their practices to an ASC, or expect shares to be priced in ways that cannot pass regulatory muster, or simply have demands or expectations that are not compatible with the overall welfare of the ASC's partners. A good partner will balance personal needs against the realities of running a profitable ASC in a way that benefits everyone in a fair way, while maintaining excellence in healthcare delivery.
To overcome these obstacles, we have hired marketing and recruiting teams with contracts that align their compensation with our long-term interests. We previously had mixed results with teams that would demand upfront or periodic payment with bonuses that were only a small percentage overall, and these incentives perhaps were not sufficient motivation.
Kris Kilgore. Administrator of Surgical Center of Michigan (Grand Rapids): Capturing our utilization and capacity as we are not on an EMR. We are looking at ways to generate reports from our EPM System. We keep a "shared calendar" in outlook that all of the surgical schedulers have access to. When a physician requests time off for vacation or to attend conferences, his/her unused or open block surgery time is placed on the shared calendar. When the surgical schedulers note that the physician they schedule for is scheduling more than three weeks out, they request additional surgery based on the "open" surgery time, indicated on the shared calendar. This helps to improve our utilization.
Jarett Landman. CEO of Orthopedic Surgical Center of the North Shore (Peabody, Mass.): Massachusetts was historically resistant to the transition of traditional inpatient cases — total joints and spine — to the outpatient ASC setting. In 2018, due to patient demand, insurer approval and successful proof of concept in other areas of the country, there has been incredible pressure to be first to market locally to offer these services. Like any new program adoption, careful consideration is given to development of clinical pathways, resource allocation, capital investment and infrastructural requirements. Thankfully, being a late adopter due to the state's regulatory restrictions has its benefits. It has given me the opportunity to leverage colleagues outside of the local geography for protocols as we begin to develop our own joint program.
Kecia Norling, RN. Administrator of Northwest Ambulatory Surgery Center (Portland, Ore.): Our center's most significant current challenge is a decrease in case volume. This decrease is caused by the retirement or slowing down of high volume founders and a replacement of these pivotal surgeons with partners who cherish and practice a work/life balance. In addition, our hospital partner prevents their employed surgeons from utilizing the surgery center. Finally, a market with several large insurance/hospital providers which steer patients to their own facilities decreases the potential case volume for our center.
We've addressed the decrease in case volume with an increase in high complexity cases such as total joint replacements. This focus on total joints and other complex cases, such as parathyroid removal with rapid PTH assay testing, and post-mastectomy reconstruction has kept our net revenue at near historic numbers despite a loss in case volume.
Heather Hilgendorf-Cooley. Administrator of Spring Park Surgery Center (Davenport, Iowa): Now with more procedures being added to the ASC payable list, we will need to not only sustain our current volume, but have the ability to take on an increasing population. Realizing this case volume, we are currently in the process of adding two additional ORs to our ASC, with a target completion date of May 1, 2019.
Raymond Hino. Administrator of Skyway Surgery Center (Chico, Calif.): We are facing many challenging issues, from competing with larger hospitals for not only patients, but also for employment of the best clinical staff. We are also dealing with rapid growth in an aging facility. Perhaps our biggest challenge, however, is securing reasonable payer contracts with the health plans in our area. As we all know, historically, ASC payments have lagged well behind hospitals and HOPDs. This has been both a blessing and a curse. We like being the low-cost, high-quality provider in our community and it helps us with payers and patients.
However, just like hospitals, we have to be able to cover our costs and provide a reasonable return. Unfortunately, many of our costs are similar to the costs for hospitals, e.g. employee salaries and supply costs. Our strategy has been to make our case with the health plans to demonstrate the value that we bring and our ability to help payers save money. We seek to be partners with the health plans in serving our community. This is a win-win opportunity as an increase in ASC surgeries helps both parties. This strategy has helped to open some doors that were previously closed and is positioning us well for the future.
All administrators featured in this article will speak on featured panels at the Becker's ASC 25th Annual Meeting: The Business and Operations of ASCs on Oct. 18-20 in Chicago. The conference will cover latest trends in healthcare, best practices from top ASC owners and operators, and examine what to expect in the future. Click here to learn more and register.