Simon Schwartz, associate director of the Colorado Ambulatory Surgery Center Association and chief operations officer of Englewood-based Strategic Resources Group Colorado, spoke with Becker’s about the key issues influencing ASCs in the state, including financial sustainability, regulatory trends and shifting workforce dynamics.
Editor’s note: This interview was edited lightly for clarity and length.
Question: What factors are most impacting financial sustainability of ASCs in your state?
Simon Schwartz: There are so many variables impacting financial sustainability for surgery centers, and it’s hard to pinpoint just one. Independent facilities — those not affiliated with large MSOs — operate in a different economic and political environment than those affiliated with large health systems. This is a nationwide issue.
Each of these facility types faces different challenges, but broadly speaking, financial sustainability is closely tied to their partnerships. Who are their third-party collaborators? Who is helping to create efficiencies within the center?
From a legislative standpoint, there has been a lot of activity over the past few years regarding private equity involvement in healthcare. All of these factors play into financial sustainability.
I also think the generational shift in physicians is a factor. Due to COVID-19, we saw a lot of older physicians retire. That institutional knowledge — built over 20 years — hasn’t necessarily been passed down to newer physicians. When I started in the industry, physicians were deeply engaged as entrepreneurs and business owners. While there are still plenty of entrepreneurial doctors, many are reaching retirement, and we’re not seeing as much knowledge transfer to younger physicians about investing in and managing their own practices.The successful ASCs are the ones that effectively manage their relationships, control spending and continue to provide high-quality patient care.
Q: Can you elaborate on what you mean by legislation involving healthcare engagement?
SS: Speaking in general terms, there has been a major effort to bring visibility to how private equity plays a role in healthcare. From a legislative standpoint, there are arguments that non-clinicians in private equity are making decisions that impact clinical care — deciding which services are provided, what materials are used, which devices are implemented, etc. This issue has been raised in many states across the country, with varying degrees of success in navigating it. Some states are just beginning to address this issue, while others are further along. But it’s definitely becoming more prominent in the industry.
Another example of legislation affecting ASCs, though on a smaller scale, is something coming up in Colorado about name badge transparency. It’s not necessarily bad legislation, but from a financial sustainability standpoint, requiring every staff member to reprint name badges to include things like their college name creates additional expenses. These kinds of requirements — often proposed by people outside of healthcare — consume more time and resources, ultimately taking away from patient care.
Q: How would you characterize the current market dynamics of ASCs in your state?
SS: Mergers and acquisitions have always been part of our industry, but the current pace is staggering. I don’t view it as inherently good or bad — it’s just the way things are evolving. Physician practices are entering agreements with large healthcare providers, sometimes with different expectations than the reality they encounter.
Twenty years ago, hospitals were viewed as competitors. Today, they are often partners. If you had asked me back then whether hospitals and ASCs would work together, I would have said only for things like transfer agreements. But now, it’s rare to see an ASC without some level of health system partnership.
There’s also a shrinking pool of providers interested in working in ASCs. It’s not as appealing as it once was.When I entered the industry in the early 2000s, ASCs were seen as great places to work — Monday through Friday jobs with consistent hours and good work-life balance. But now, 15 to 20 years later, the staff’s perspective has changed. There’s been a corporatization of the industry. Again, I don’t see this as inherently good or bad — it’s just the direction things are moving.
Q: Do you mean the hours have changed, or is it more of a cultural shift?
SS: It’s more about workplace mentality. The corporatization of healthcare has changed the way staff engage with the industry. Fifteen years ago, ASC administrators and physicians wanted to be actively involved beyond their day-to-day jobs. They wanted to attend legislative meetings, engage with the state health department, and advocate for ASCs. Now, that engagement has dwindled. Staff expect leadership to handle those responsibilities and report back to them.
