5 Core Concepts for ASCs to Add New Procedures

The most attractive procedures and specialties to add over the next year are high acuity cases in orthopedics and spine; cardiovascular procedures could join them in the future.

However, just adding these procedures doesn't guarantee a home-run; an ambulatory surgery center won't always benefit from these procedures, especially if there isn't enough volume to justify the costs of equipment purchase, staff training and physician recruitment.

Market analysis
"If an ASC wants to add high acuity cases and the impetus for doing so isn't coming from within the current surgeon mix at the facility, we evaluate the availability of physicians in the area that may be interested in doing their procedures at the center," says Kelli McMahan, RN, CASC, vice president of operations for Pinnacle III. "Are these physicians independently-owned? Do they currently perform cases at the local hospital? Can we provide a more attractive work day at the ASC — less surgeon down time so they get more cases in per day and still return to their families in early evening? If so, then we'll approach them to determine if it makes sense to add the procedure(s) to the ASC's current case mix."

Creekside Surgery Center, located in Anchorage, Alaska where Administrator Sue Sumpter added total joint replacements to her ASC in 2011 and is currently in the process of adding spine. The ASC opened in the fall of 2010 with the goal of adding these higher acuity cases.

Since beginning the program, surgeons at Creekside Surgery Center have performed more than a 150 total joint cases and continue to perform three to five total joints per week. There have been zero infections or complications at the center, with no hospital transfers.

"One of the reasons we are able to perform total joints is we are located in the same medical office building as an assisted living facility," Ms. Sumpter says. Upon being discharged to the assisted living facility, patients spend a few days in a private room before being sent home with a physical therapy program to assist in their recovery.
"The process works well and patients love not being in the hospital," says Ms. Sumpter. A lot of the success is due to diligent patient selection. Our Medical Director is very involved in the evaluation of all patients.

Expanding the program
Attracting new physicians — or convincing current physicians — to bring these cases to the center can be a challenge. However, ASCs can win over even skeptical surgeons by providing a better patient and physician experience.

"We can provide surgeons with a consistent nursing team to take care of them every time they are in the facility — which can differ vastly from their experience at a hospital where they may end up with a new person for every surgical day," says Ms. McMahan. "We can demonstrate to physicians that we provide a better patient experience due to lower patient-to-nurse ratios. We have the same surgical equipment as the hospital and can dedicate more time to one-on-one patient care as well as physician customer service."

Total joints and spine procedures often take slightly longer than other, low acuity cases performed at the center. ASCs should also be prepared for longer room turnover times as well. To eliminate surgeon downtime, Creekside Surgery Center opens two operating rooms per surgeon and allows them to flip from one to the other whenever possible.

"It works out well when we can run two rooms for the surgeon so when they finish up one procedure, they are ready to start the next one in the other room," says Ms. Sumpter. "It's nice to have the option of flipping rooms."

Committing the financial resources to adding and expanding ASC programs is also important. The primary expense for adding new procedures is the technology: equipment, instrumentation and implants surgeons might use. "We have to know we can get implants reimbursed," Ms. McMahan says. "If we can't, we won't be able to cost-effectively perform the cases and cover our costs. We also need to make sure we realize a return-on-investment on the equipment."

Figure out how many cases it will take to pay the expense off. Then train the staff so they are ready to perform those cases and educate their patients on what to expect. Since many of these cases are bigger, patients still expect to spend a significant amount of time recovering before going home, and that can impact the case's success rate.

"Education starts when the physician's office schedules the case," says Ms. McMahan. "We ensure the schedulers set the stage for patient expectations — namely, that they will go home a few hours after surgery. That is very important from an operational standpoint."

Physician leadership
Strong physician advocates along with a talented clinical team is essential to the center's success. "We have orthopedic surgeons who are interested in not taking these cases to the hospital. For this program to work, we had to have motivated surgeons willing to assist in the development," says Ms. Sumpter. "The staff and family must also be motivated to help the patient recover from the procedure. The physician’s staff must arrange for prescriptions, walkers, bedside commodes and other things the family will need once the patients return home."

Pain control can be another challenge. With the appropriate patients, new developments in the field allow physicians to control pain in the outpatient setting. Patients at Creekside Surgery Center receive blocks prior to surgery and have PCAs for pain control after they are discharged to the assisted living facility.

"Our physicians have developed a pain management protocol which allows the patient to experience relatively low pain while recovering at the assisted living." says Ms. Sumpter. "The assisted living facility does not have a pharmacy, so our physicians have to preorder whatever medication their patients will need."

When Creekside Surgery Center began performing total joints they scheduled those cases to be first in the morning. While they still attempt to do those cases first, experience has shown these can also be done later in the day as the surgeon's schedule demands it.

"We also try to do the total joints in the first three days of the week so they are discharged from the assisted living by Friday," says Ms. Sumpter. "We've been able to attract patients through education. Sometimes we have a nervous patient and we can connect them with other patients who are willing to give their testimonials."

Payer contracting
Another important factor is contracting for these procedures. Although many high acuity cases earn higher reimbursement than other procedures at ASCs, they are also more expensive to perform. An educated negotiator armed with the center's data — as well as cost data from competing facilities and industry standard reimbursement — can achieve appropriate rates for these cases.

"Education beyond what a non-clinical person can provide is essential," says Dan Connolly, vice president of payor contracting at Pinnacle III. "That's why I suggest ASCs connect their physicians with the payer's medical director. It also helps to extend invitations to payers to tour the facility, either prior to or during negotiations, as part of the education process."   

If nobody at the center is able to conduct the research necessary to really understand the market price and conduct an educated contract negotiation, hiring an expert might be the best option. In some cases, uneducated negotiators have accepted substantially lower rates than market value and the ASCs were unable to cover costs; in those cases, some centers have had to drop those procedures.

"It hurts when inexperienced and/or unprepared people go into negotiations because they often dive in, accept rates that are too low and set a precedent that is difficult for other ASCs to overcome," says Mr. Connolly. "I have seen a significant drop in reimbursement in some markets because other ASCs have accepted much lower rates than what the market could bear. It doesn't make sense for higher acuity cases to be a facility's 'loss leader.'"

Future outlook
Payers are becoming more eager to transition many of these higher acuity cases to ASCs. Mr. Connolly has seen some payers, who wouldn't contract with his centers a year ago, now willing to work with him. After reviewing the data on what competitors are paying, he is sometimes able to double or triple the original "final offer" from payers.

"They thought our proposed rates were grossly high, but once we demonstrated average commercial reimbursement by CPT, they were able to better see where we were coming from and we were able to secure attractive rates," he says. "We showed them what our ASC was receiving from other payers. In addition, we also provided payers with hospital cost information and CPT to DRG crosswalks to help payers fully appreciate the cost saving aspects of partnering with the ASC. "

Ms. Sumpter approaches negotiation with wary payers by providing education on patient satisfaction, clinical care and cost-savings. "It takes some education to prove we are set up for these procedures and can be successful with no additional risk to the patient," says Ms. Sumpter. "There is an industry change in the mentality that these procedures can be done successfully in the outpatient setting. We show the payer our costs so we can substantiate a rate we all agree on. If the payer says 'No' just keep knocking at their door and educating them."

More Articles on Surgery Centers:
How Important is Your ASC Today vs. 5 Years Ago?

10 Things That Make ASC Board Meetings Inefficient

What Does the ICD-10 Delay Mean for ASCs?

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