Health systems are running out of time to get their ASC strategy aligned, according to Compass Surgical Partners’ CEO Mark Langston.
Mr. Langston joined Becker’s to discuss how ASC strategy has surged and why health systems that hesitate now may find the opportunity gone for decades.
Editor’s note: Responses have been lightly edited for clarity and length.
Question: What is different about the conversations you’re having with health systems now compared to a year or two ago?
Mark Langston: The thing that has changed is site neutrality. Every payer is focused on it. Medicare is doing away with the approved procedure list over the next three years. Everything is moving in that direction.
If a system is going to get paid much lower for doing procedures inside a higher-cost setting — and hospitals are higher-cost settings because they have more bricks, more overhead — you can’t change the bricks and mortar and the cost structure you have in place today. So they have to focus on getting the right case in the right setting.
Now it’s affecting the bottom lines of hospitals and health systems everywhere, and they’re trying to figure out solutions.
There’s also an evaporation effect happening: physicians and practices are getting acquired; surgical sites of service, ASCs, are getting acquired — and once they’re gone, they’re gone for decades.
So if site neutrality is becoming core and central and you haven’t developed that network, you can still try to develop it — but you might not have physicians to go into it if they’ve already been acquired or partnered with someone else and are locked up in a noncompete.
The day of reckoning is here. People are starting to understand the confluence coming together in a way that’s like, “Oh yeah — if I don’t act now, the opportunity to work with key physician groups is going to evaporate in front of my eyes.” Once that’s occurred, there’s no going back.
You can go piece by piece — acquire or employ a doctor at a time — but it takes years to come close to catching up on that strategy.
First-mover strategies have happened in most major metropolitan areas over the last decade, and now other systems are trying to play catch-up. It’s still doable in most places, but it’s not going to be possible for much longer, in my opinion.
The number of [request for proposals] we’re seeing come in for surgical services and ASC strategy is five to six times what it has been historically.
