The ASC landscape has evolved to become more challenging for independent centers and facilities reliant on low-acuity cases.
But there are still opportunities to thrive in a competitive market. Two industry experts talked about how ASCs can be successful in competitive markets during a panel at the Becker's ASC Virtual Event last October. Click here to view the entire discussion.
Question: What is the ASC competitive landscape like today and how can centers thrive?
David Rothbart, MD. Medical Director of Spine Team Texas ASC (Southlake): Practices [in Texas] are the last holdouts of fiercely independent groups. But in the last couple of years the number of independent practices that have been folded into healthcare systems has just accelerated at a logarithmic pace. What we're seeing in this market dynamic of large chains that partnered up with healthcare systems here and then venturing off into ASCs owned by the healthcare system, ASC chain and practices. Those models in this market are doing very well. The truly independent ASCs, we're starting to see some significant struggles.
As far as the opportunity for ASCs to distinguish themselves in competitive markets, the basic tenets of that, I don't think really have changed. I've been waiting to hear about cost and quality actually mattering. In some markets it does. I can tell you here, neither of those has really mattered [in my market]. Although when you can come to the table and you can demonstrate cost and quality, it has resonated, but it has not had as big an impact in this marketplace. Clearly, having the right leadership at the table so that the ASCs are very physician-friendly and ease of use is going to be important.
I also think having the capital to invest in technology to expand the service lines, like cardiology, is important. In my space, utilizing robotics or image guidance are big game changers, and that's how we have to attract the surgeons to want to do their procedures. In spine, it's a leap of faith to go from the hospital setting into the outpatient setting, and now that snowball's getting some momentum.
Matt Searles. Partner at Merritt Healthcare Advisors (Ridgefield, Conn.): There will be out-migration of lower-acuity cases. If it hasn't come to your market, it's soon to come. Payers are going to push those procedures right into offices. You certainly can make up for it with the higher-acuity cases, and that's where you should focus. I do think that the focus on quality first is important, and it sounds cliché, but the biggest risk in this business is compliance, risk and patient safety. I think for the centers that focus on that in environments where payers are moving to at-risk models, that's where ASCs will continue to thrive and do well. We'll weed out some of those facilities that aren't focused on that, which has already been occurring.
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