Becker's ASC Review

49 HEALTHCARE NEWS staff members know exactly what actions to take to ensure that the revenue cycle is optimized for outpatient spinal surgeries: Front desk personnel need to ensure that patients meet pre-surgery requirements; provide an estimate of the patient's financial responsi- bility; and collect the deductible, co-pay or co-insurance in advance or on the day of surgery. As such, front desk staff need to be thor- oughly trained in financial counseling, the pre-authorization process, insurance verification and eligibility. Medical coders must understand the ins and outs of each patient's health insurance contract. Not only do they need to know the relevant codes for each surgery, but how particular implants and procedures are reimbursed. Every contract uses the same common procedural terminology (CPT) codes but how they determine implant reimburse- ment will likely be different depending on the contract. Creating sum- maries of pertinent information from each contract can enable coders to easily and quickly find needed information. Revenue cycle staff members need to understand the documentation each payer requires for different implant charges. When the payments are received, they need to ensure that the payments match the amount stipulated in the contracts. Most importantly, they need to flag un- derpayments. For example, when a payment was received for $16,000 but the contract stipulated $20,000, staff members need to note this underpayment and follow up. Staff should conduct a monthly audit to ensure that each procedure was coded, billed and paid correctly. If they uncover any discrepan- cies, they should drill down to see where the mistake originated, and then file an appeal if warranted. e importance of paying attention to the revenue cycle details cannot be underestimated. Even a seemingly insignificant mistake could lead to denials, incorrect payments, underpayments or even no payment at all. Financial Impact As mentioned above, incorporating spine procedures into your ASC can be highly impactful from a financial perspective. Consider, for example, a multi-specialty surgery center that performs 300 cases per month (3,600 cases annually), with an average cash per case of $2,000. is center would generate $600,000 per month in revenue ($7,200,000 annually). Using a 20% EBITDA profit margin, this center would have $120,000 per month of EBITDA ($1,440,000 annually). If that ASC adds 15 lumbar fusions per month, which represents only a 5% increase in overall case volume, at an average cash per case of $20,000 per procedure and a 50% EBITDA margin, then that ASC would have increased its overall revenue by 50% while more than doubling its profitability. Simply put, in this example, the ASC more than doubled its value by adding a small number of spinal fusions per month. In the final analysis, the movement of spinal procedures from hos- pitals to ASCs creates tremendous benefits for patients, health care providers and payers, and can be one of the most financially impactful initiatives your surgery center can undertake. n 8 observations on the outlook for ASCs post-pandemic By Laura Dyrda E ight observations on how ASC owners and opera- tors are thinking about the post-pandemic period and what they expect in the future. 1. During the COVID-19 crisis, many ASCs applied for the Small Business Association loan and expanded telehealth services while others closed down their facilities. Some also drew down on lines of credit and applied for state and local grants. ASCs are typically re- porting a 30 percent or more revenue drop, with many reporting more than 50 percent revenue decline. 2. As hospitals and ASCs report lower revenue due to the pandemic, payers have reported strong profits. During the first quarter of 2020, UnitedHealth Group posted $3.4 billion in profit and Optum reported $32.8 billion revenue. Payers could use their strong finan- cial position to acquire physician practices or surgical centers in the future. That has already begun to some degree, as Blue Shield of California acquired the Oak- land, Calif.-based Brown & Toland Physicians, which includes 2,700 physicians in April. 3. As surgery centers are resuming cases, the case acuity is the biggest factor in deciding which cases to pursue first. Administrators are also considering how local hospitals are able to ramp up elective procedures and previously established block time as they develop their post-pandemic schedules. 4. A large portion of ASCs are working extended hours or on weekends to cover the backlog of cases, and sev- eral are also considering a more robust telemedicine program. There are several centers that are expanding capacity or considering investing in a new center to increase capacity in the future. 5. A small portion of ASCs are considering adopting new technology to maximize case efficiency and/or hir- ing more physician assistants and nurse practitioners to handle the backlog of cases. 6. A majority of ASCs aim to move forward with plans they had before the pandemic, with a smaller percent- age considering joining an ASC chain or bringing on a private equity partner. 7. ASCs are reporting 20 percent or fewer patients are self-selecting out of surgery as a result of the pan- demic, although many do report that up to 50 percent of their patients have voice economic concerns related to their surgery. This could provide ample opportunity for ASCs to develop more robust financial planning capabilities for their patients. 8. ASC administrators report being cautiously opti- mistic about the future, but it could take three to six months to resume normal levels of case volume at the ASC. Some physicians, however, are concerned that there will be a backlog in payer approvals as elective surgeries ramp up again.. n

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