5 key challenges for ASCs

As the healthcare industry shifts toward care in outpatient settings to cut costs and boost care quality, ASC leaders are challenged to manage several issues in their market — from a lack of efficient patient data management tools to adjusting to new ASC players.

At the Becker's 16th Annual Future of Spine + The Spine, Orthopedic & Pain Management-Driven ASC Conference June 14 in Chicago, a panel of ASC experts discussed some of the most prevalent challenges ASCs face today. The panel included:

  • Elena Fuentes, RN, vice president of ambulatory surgery at Pain Specialists of America in Austin, Texas
  • Chris Bishop, CEO of ASC management services company Regent Surgical Health
  • Corey Welchlin, DO, orthopedic surgeon and owner of Fairmont, Minn.-based Center for Specialty Care

Here are five top challenges ASCs face today and how to address them, as discussed by the panelists:

1. Lack of data management technology. "As ASC professionals, we often run into issues with regulatory and cost constraints," Ms. Fuentes said. "We're all working together to solve these issues, but for me, one of the biggest challenges comes from data. Data is a four letter word — the bad kind, because outside of revenue cycle management, there isn't an easy way for ASC administrators to get a handle on their data, especially independent ASCs."

Often, independent ASCs lack the resources a hospital may have to look at data, and it can be nearly impossible to pull data together for an ASC, as many facilities still use paper charting as opposed to EHRs, Ms. Fuentes added.

Mr. Bishop agreed, adding that ASCs have not reaped the benefits of widespread electronic patient data since the ASC market is not big enough for large EHR vendors to consider.  

"For whatever reason, the surgery center industry fell through the cracks when the government made technology funds available for hospitals to move to an electronic platform," Mr. Bishop said. "We have software that helps us drive the information systems of the surgery center, but we don't have a true EHR that our industry has widely adopted, and for the few that have taken the plunge, it hasn't been a positive experience."

2. Revenue cycle personnel. Dr. Welchlin shared how his independent facility was fortunate to have an administrator who could build an in-house billing team. "We've outsourced billing three different times in 28 years, and each one was a disaster," Dr. Welchlin said. "You can outsource some of it, but as a business owner, you have to have your fingers in it and look at what your personnel are coding."

Dr. Welchlin described the potential challenges outsourcing presents for ASCs: "We had a 50 percent error rate in coding of my surgical practice alone," he said. "As a physician or business owner, you have to know that coding staff won't always have your best interest. By taking responsibility and learning the coding better and the revenue cycle management process better, you can improve your process."

3. New players in ASCs — private equity funds. ASCs are positioned for interest from private equity groups and other financial investors, but can face challenges when determining the right investment partner.

"Private equity has a place right now for independent practices that have ASCs, especially those looking for something that's not necessarily a joint venture with a hospital," Ms. Fuentes said. "The most important thing for ASCs is to find a good private equity partner that aligns your goals with their goals. If you're looking for a private equity partner that's just going to inject cash into your practice, you need to make that clear up front." 

Private equity typically sits at the top of the economic food chain, Mr. Bishop said. "They're looking for value and growth. Nobody's buying hospitals these days, so they're looking for an ambulatory platform because those of us in the ASC space know we're the low-cost, high quality surgery providers."

Mr. Bishop pointed to the value ASCs present to patients as well as investors. "Our culture is fed up with the expense associated with healthcare," Mr. Bishop said. "You're going to see a vast patient migration to the outpatient setting, and private equity groups are looking for those high growth, ambulatory businesses with lower costs and higher quality."

4. Recruitment of physicians in rural ASCs. For Dr. Welchlin, whose practice is in rural Minnesota, recruiting physicians to an ASC setting can be incredibly difficult. "What I've done to diversify my surgery center is to bring in different surgeons and providers from surrounding cities to do various procedures during the week. It's been fantastic for my facility," Dr. Welchlin said.

Mr. Bishop discussed how surgery centers can offer stronger specialty services, where physicians can refine their skills by performing a large number of the same procedures.  

"Hospitals are good at being generalists, but rarely are great at any one thing, whereas having private equity groups in the ASC setting allows physicians to be far more entrepreneurial and drive a lot of the practice strategy," Mr. Bishop said.

5. The role of reimbursement in shaping ASCs. "For a single specialty or multispecialty practice like ours, when we decide to bring in new procedures our physicians want to do, one issue we face is going back to our payers and ensuring all the new codes will be covered and the reimbursement is correct," Ms. Fuentes said. More often than not, we find these codes are excluded from our contract."

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