12 ASCs with innovative cost-cutting initiatives

Here are 12 ambulatory surgery centers with innovative and effective cost-cutting strategies.

Ambulatory Center for Endoscopy (North Bergen, N.J.). According to Sarah Malaniak, CASC, administrator of the center, the most important cost initiatives that she has implemented since joining the center in February are cross training and flexible staffing. "This has reduced the amount of overtime hours at my center to zero thus saving the center thousands of dollars," she says.

Ms. Malaniak also suggests renegotiating all service contracts when they come up for renewal as it is possible to find savings by renegotiating. Also being aware of the contract renewal date is crucial to the renegotiation process. She also suggests standardizing medical supplies to cut costs.

"If you can get your physicians to agree to all use the same type of supplies for the majority of the cases performed, you will be able to negotiate better pricing with vendors based on volume," she says. "Have more than one source for medical supplies, pharmaceuticals, etc. Also, pay invoices early if you are able. Some vendors offer up to a 3 percent discount if you pay your invoices net 15 instead of net 30."

The surgery center was founded in 2006 and has provided endoscopy services to more than 21,000 patients from around the region. It is accredited by the American Society for Gastrointestinal Endoscopy and Accreditation Association for Ambulatory Health Care. The 8,000-square-foot center includes two procedure suites, a four-bed pre-operative/admitting area, as well as a post-anesthesia monitored recovery area.

CBC Surgery Center (Schererville, Ind.). According to Amy Sinder, administrator of CBC Surgery Center, hiring all flex staff and capping fulltime employees at 32 hours per week. This will drive staffing costs down without deterring quality employees; the really qualified nurses like time flexibility and working without being on-call, she said in a Becker's ASC Review article.

The surgery center provides care in a wide array of specialties, such as gastroenterology, general surgery, gynecology, hand surgery, ENT and urology. It is accredited by the Joint Commission on Accreditation of Healthcare Organizations.

DISC Sports & Spine Center (Marina del Rey, Calif.). Every new item purchased at DISC Sports & Spine Center must have COO Karen Reiter's approval. "We have a fairly strict process for ordering spine implants. Each request goes from the physician to the surgery scheduler and then to my desk, where and I verify the purchase price and that it's an implant for which we have already made an arrangement," said Ms. Reiter in a Becker's ASC Review article. "Then my tech emails the vendor to make sure they have it here."

DISC Sports & Spine Center also has a written policy to combat upselling in the operating room. Device reps are not able to upsell technology without approval from Ms. Reiter, and if they do, they're responsible for the cost. The surgery center, founded by Robert S. Bray Jr., MD, focuses on providing care for those suffering from sports injuries, orthopedic issues and spine disorders.

Hallandale Surgery Center (Hallandale Beach, Fla.). Don't buy supplies to just put them in storage, Administrator Lilliana Lehmann said in a Becker's ASC Review article. Meet with vendors regularly and purchase as many supplies on consignment as possible. Group purchasing organizations can also help keep supply costs down, she said.

The surgery center is Medicare-certified and accredited by the Accreditation Association for Ambulatory Health Care. The 6,400-square-foot of space features two operating suites and one procedure room. The center offers surgical services in spine surgery, pain management, hand surgery, orthopedics and ophthalmology.

Macomb Township (Mich.) ASC. The surgery center formed a Savings Value Analysis Committee that meets quarterly and is comprised of the materials manager, a central processing department person, at least one scrub technician and one operating room registered nurse, says Karen Howey, CASC, administrator and CEO. The committee discusses possible cost savings ideas and areas to focus on — from new products to a new surgeon who has come onboard and is requesting costly items.

"Getting the staff focused on the problem, making them aware of costs and giving them time, set aside, to work on it has had a huge [impact] on the education and results of this committee," she says. "Our materials manager 'rounds' on our top vendors and physicians monthly. She makes it a point to sit down and discuss new items available, better cost savings through trialing a product or changing products with the physicians. She is also constantly asking the vendors about what is on the horizon that is cheaper and how can we improve what we are already have."

The surgery center is affiliated with Nueterra Healthcare and Royal Oak, Mich.-based Beaumont Health System. It offers a wide array of specialties, including general surgery, gynecology, ophthalmology, orthopedics, gastroenterology, podiatry and pain management.

"We are constantly looking for any and all reprocessing opportunities. We check, again biannually, to see if there are new items we can reprocess that we are not currently doing. We added some ENT items last year that resulted in thousands of dollars in savings. The caution here is to make sure the reprocessing company you chose meets all the required standards," says Ms. Howey.
Premier Orthopaedic Surgery Center (Nashville, Tenn.). Administrator Natalie Soule uses a group purchasing organization to leverage the best prices available for implants and always communicates to the physician about the price and reimbursement of the same-quality implant before approving a physician preference item purchase. However, she wants physicians to make the final decision.

"It is not our place to tell a physician whether they can or cannot use a particular type of implant or supply; however, if a physician requests an implant or supply that is not on contract, we would communicate to the physician the cost of the implant/supply, and my contract alternative," said Ms. Soule in a Becker's ASC Review article. "We strive to educate our physicians to the cost of implants and reimbursements."

The surgery center is a part of Premier Orthopaedics, which has eight locations and includes 27 orthopedic specialists. It offers comprehensive musculoskeletal services, including hand, hip, shoulder and spine care. The surgery center includes preoperative and postoperative areas.

SMI Surgery Center (San Diego). "Go Local! Our center is going to save almost $5,000 per year by switching from a large payroll company to a local one that offers many more services, including customer service. We've also switched from a large biomedical waste company to a local vendor and saving 20 percent per year," says Judy Harless, MBA, CASC, administrator of the center.

The surgery center encompasses 12,000 square feet, and it includes four operating rooms and two private 23-hour stay rooms. It is Medicare-certified and Joint Commission on Accreditation of Healthcare Organizations-accredited. Opened in 2009, the multispecialty surgery center focuses primarily on orthopedics, pain management and neurosurgery.

Surgery Center at Pelham (Greer, S.C.). Watching goals closely can help surgery centers cut costs, said Bill Hazen, administrator of the ASC in a Becker's ASC Review article. The center has a series of goals that change depending on performance. "Right now our goals focus on case cost, case revenue, patient satisfaction and physician satisfaction. Five percent of all distributions are split equally among all the employees if these goals are met. For every dollar the staff saves the center that is five cents in their pockets," he says.

The multispecialty surgery center includes orthopedics, pain management, gynecology, ENT, gastroenterology and urology.

Surgery Center of Reno (Nev.). This Regent Surgical Health-affiliated ASC formed a quality improvement committee led by an operating room staff member who had a true understanding of the initiatives and processes necessary to achieve quality care at a lower cost. The STAR (Surgery, Tactics and Recognition) committee included OR staff and leadership that worked together towards the goals, she says.

"We methodically went through service lines with a standardized approach, looking for opportunities for cost savings, trade out of products, practice changes and staff education. Physicians were involved in review of both products and processes," says Ms. Roberts. "We measured the results in multiple ways. The completion of specific goals was measured, for example, we ensured that all preference cards were updated, and we reviewed and revised of all OR packs. At year end, we were able to save approximately $105,115 in medical supplies from the previous year."  

The freestanding surgery center has direct hospital access if the need arises to transfer. Its physician team performs surgical services in neurosurgery, ENT, general surgery, orthopedics, gynecology, urology, podiatry and pain management, among others. James J. Lynch, MD, a fellowship-trained spinal neurosurgeon is president of the ASC and chairman of the board.
Texas Orthopedics Surgery Center (Austin). According to Luann Lamb, who manages supply and equipment orders at the surgery center, with fluctuating drug prices and availability, having three to four sources for pharmacy purchases saves money. Also, keeping a list of vendors and pricing for each drug gives ASCs a quick reference and they can move down the list and find the best price.

"Many times you see a large price difference between the different vendors. At one time we were ordering all of our drugs from one vendor. Having multiple sources can save us up to $1,000 on a weekly order," says Ms. Lamb.  

Also, using two group purchasing organizations with two different vendors has also saved the center a lot of money, and Ms. Lamb has found savings of more than $8,000 over a one year period on supplies ordered every week.

"We use primary and secondary vendors for our implants so I know when I need to replace or add an instrument set, and I can usually go to my vendors and ask for a deal. I agree to purchase a number of implants up front and the vendor gives us the instrument set for free. I will only agree to this if I know we can use the implants within one quarter so I do not have product sitting on my shelf. We are not spending any more money than we would have and we add instrumentation to our inventory," she says.

Founded in 2002, the ASC is owned and operated by the physicians of Texas Orthopedics. It is fully accredited by The Joint Commission. Procedures commonly performed at the center include arthroscopy, knee arthroscopy, shoulder arthroscopy and endoscopic carpal tunnel surgery.  

The Endo Center at Voorhees (N.J.). According to ASC Administrator Andrew Weiss surgery centers need to do some out-of-the-box thinking to successfully cut costs. For example, The Endo Center talked to its electric supplier and found that they could get a better rate because of their high usage. "We are saving over $50,000 a year because of looking into utility costs," he says. "ASCs should also look into block time utilizations. Start with your surgery partners. Remember that efficiencies in block time and improving those can save a lot of money. Benchmarking is also a good idea. Look at what other centers are doing and get information regarding their costs. If you aren't looking at this already, you should be."

The surgery center is an outpatient, endoscopic facility focusing on colorectal cancer screening and the treatment of various digestive diseases. It includes multiple GI endoscopy procedure rooms and recovery rooms. It is Medicare-approved and accredited by the Accreditation Association for Ambulatory Health Care.

"A journey of a 1,000 miles begins with one step," says Mr. Weiss. "A dollar here and there counts and it all adds up. Sometimes it's the smaller opportunities in cost-cutting that have the biggest impact, not necessarily the dramatic overhaul."

The Orthopaedic Center at Springhill (Mobile, Ala.). While it doesn't make financial sense for an ASC to consistently perform unprofitable cases, ASCs should think twice before rejecting every less-profitable case, said Dean Brown, MBA, CASC, CEO of Alabama Orthopaedic Clinic and administrator of the center, in a Becker's ASC Review article.

His surgery center tries to look at the totality of a physician's case load rather than nitpicking each individual case. This approach helps boost physician loyalty, which in turn contributes to center profits. "There are sports medicine cases that we lose a little bit of money on, but if the physician is bringing [overall profitable cases], we don't force them to take one case somewhere else," he says.

The surgery center is a part of Alabama Orthopaedic Clinic, which includes approximately 20 physicians focusing on all aspects of orthopedic care. Care offered at the center includes joint replacements, foot and ankle procedures, interventional pain management and spine care.

More Articles on ASCs:

Oregon Outpatient Surgery Center first ASC in Northwest to perform total hip replacement: 3 things to know
Beyond the Basics: 3 Approaches to Next-Level ASC Revenue Cycle Management
Physicians at the helm: creating a culture of gastroenterologist leadership in ASCs & endoscopy centers

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