Skyway Surgery Center launched its 1st bundled payment agreement in early 2018 — Why it won't be their last

Raymond Hino, administrator of Chico, Calif.-based Skyway Surgery Center, discusses the best opportunities for ASCs right now.

Mr. Hino will speak at the Becker's ASC 25th Annual Meeting: The Business and Operations of ASCs, October 18-20, 2018 in Chicago. Click here to learn more and register.

Question: What is the biggest issue your ASC is facing today? What strategy are you using to overcome it?

Raymond Hino: 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.

Q: How is value-based care affecting your ASC or your plans for the future?

RH: To date there has been very little effect of value-based care on our facility. However, we expect that to change in the near future as mandatory reporting requirements and reimbursement of ASCs continues to evolve. As a Medicare-participating ASC, our facility participates in the Ambulatory Surgery Center Quality Reporting Program. Additionally we have voluntarily chosen to participate in the Outpatient and Ambulatory Surgery Survey Program. Although not currently required, participation in OAS CAHPS, provides our facility with national peer comparison data so that we can measure ourselves against other facilities. In my opinion, the result has been a success. We consistently achieve scores in the 90th percentile, which is a marketing advantage and we are positioning our ASC for success if this survey ever becomes mandatory.

Value-based care is not only about mandatory quality reporting; it is also about changes in reimbursement. We entered into our first bundled payment agreement earlier this year. It will not be the last one. Since we are already partners with our physician providers, it makes sense that we would become partners for innovative payment systems as well. We are actively involved in pursuing additional bundled payment agreements that will fuel our organization into the future.

Q: Over the next 2-3 years, what is the biggest opportunity for growth of your ASC?

RH: I believe that the biggest opportunity for growth for our ASC in the future is in total joint replacement surgery. We are already performing total joint procedures at our facility. However, with the eventual likelihood that total knees and total hips will be given an established payment rate, it is inevitable that more Medicare total joint surgeries will be moving to ASCs like ours. We are preparing for that eventuality with a facility expansion project that will add another OR specifically for total joints and more 23-hour beds. We also see tremendous growth potential in other procedures that we perform, such as laparoscopic hysterectomies and cataracts.

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