The ASC obstacle that is 'literally out of control,' according to a CEO

Jeremy Riley, CEO of Titusville, Fla.-based GML Healthcare Consulting, joined Becker's to discuss the disruptions of the ASC industry. 

Question: What will disrupt the ASC industry next?

Editor's note: This response was edited lightly for brevity and clarity. 

Jeremy Riley: Supply chain disruptions, staffing shortages, wage inflation, reductions in reimbursement, increased construction costs and ongoing regulatory changes continue to be the challenges at the forefront of operating a successful ASC. It's most definitely a balancing act for any administrator and attempting to project the future merely makes the job that much more challenging.

As most are already aware, supply chain costs are literally out of control. The ASCs that I've consulted with in the past 12 months have experienced a 10 to 24 percent increase in medical supply and equipment cost. ASCs aren't only experiencing an inflation in supply cost, but also have been impacted by a delay and/or a backlog in receiving ordered supplies. These shortages continue to be directly related to the pandemic, while others are a result of backlogged shipping ports, transportation glitches and factory closures in other countries.

Staffing shortages are projected to continue through 2024, if not longer. A large percentage of ASCs are operating with vacant positions and are struggling to recruit and retain. This scenario is all too familiar across the healthcare industry abroad. ASCs have found themselves in a position of need to be creative in their recruiting approach by designing recruitment incentives that not only attract high level talent, but improve motivation and maintain retention. A majority of studies demonstrate one-third of the healthcare workforce is on the edge and/or are burnt out.

In addition to increased operating costs, ASCs are challenged with reductions in reimbursement. Therefore, operating margins are managed utilizing a highly magnified microscope. As a result, the need for efficiency significantly increases in order to absorb the increased operational cost of offering services. 


Regardless of ASC operational and financial challenges the market trajectory relating to growth will only intensify the sensitivity of these factors in the next several years. The volume of cases being redirected from the hospital to the ASC setting continues to grow by leaps and bounds.  An actional strategy to overcome the discussed challenges would be to cultivate a positive culture and work environment through servant leadership, create strong internal team oriented relationships, develop a wide array of external relationships maximizing referral sources, manage revenue cycle tightly, working with the providers concerning their flexibility to try or utilize less costly alternative supplies and, lastly, drive volume in order to maximize revenue. Adopting operational and financial best practices are key to sustaining long-term success.

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