Becker's ASC Review

22 Thought Leadership Implant reimbursement vs. ASCs: 5 leaders weigh in By Patsy Newitt I mplant costs are a burden for many ASCs, and many feel ASCs have irreparably shied the implant industry. Here are five ASC leaders and their thoughts on implant-ASC relationships: Andrew Lovewell. Administrator at Surgi- cal Center at Columbia (Mo.) Orthopaedic Group: Commercial contracts have to be well constructed to ensure that hardware and implants are being paid on all of those extremely complex procedures. In the world of CMS total joint arthroplasty within an ASC, implant costs mean everything. At some point, many administrators and surgeons may feel that there is a race to the bottom, and that simply can't happen. ASCs were designed to be a streamlined healthcare delivery model, but there is still an inherent cost of doing business. Mark Kerner, MD. Surgeon at Hampton Roads Orthopaedics Spine and Sports Medi- cine (Newport News, Va.): e pandemic has accelerated the disruptive change ASCs are having on the implant and technology industry. In the world of ASCs, many physicians are owners, so they are incentivized to put a premium on efficiency. ey have little desire to pay for technology where classic techniques can be used without it — that puts the physician on the other side of the negotiating table from industry. e incentive is low tech, low cost, which disrupts the sales paradigm that has built the implant industry and was formative to the careers of the sales force in it. An industry that is conditioned to huge profit margins is going to face a race to the bottom for prices. Like any mature industry, economies of scale will begin to be meaning- ful. Only the larger and efficient will remain profitable at the new price points. Brian Bizub. CEO of Raleigh (N.C.) Ortho- paedic: e biggest challenge is with every move of an inpatient surgical case to the ASC is a substantial reduction in reimbursement, leaving little to no margin for profit unless the government engages in equipment, instrumentation, supply chain and implant costs similar to CMS› competitive bidding process on durable medical equipment and average sales price for medications. Barbara Bergin, MD. Orthopedic Surgeon at Texas Orthopedics, Sports & Rehabilitation Associates (Austin): Now it's looking like a total joint replacement is going to be done more and more in the ASC setting, especially on healthy patients who are not on Medicare. Medicare may have said they're going to allow surgery in the ASC setting, but the amount that they pay is so little that it barely covers the cost of the implant and the other equipment that is necessary to perform the surgery. So I think it's going to be a little while before Medicare patients will be done in an outpatient setting. Devin Datta, MD. Orthopedic surgeon at the BACK Center (Melbourne, Fla.): e biggest challenge ASCs will face with payers in the coming years will be dealing with implant reimbursement and showing insurance carriers the value ambulatory surgery provides for both patients and insurers. n Tackling bundled payments: ASC leaders weigh in By Patsy Newitt M ore ASCs are considering bundled payments as a part of their strategy. Three ASC leaders spoke with Becker's ASC Review on addressing obstacles with bundled payments. Note: These responses were edited for clarity and brevity. Mark Spina. Executive Director of Ambulatory Surgery Centers of America: Regarding bundled payments, the biggest challenge for ASCs is getting all parties that produce a bill during an ASC procedure — primarily the ASC owners, the surgeon, anesthesia and pathology — to agree to a bundled payment for their services. If the commercial insurance company is offering a total bundled payment of $5,000 for the procedure, how is the payment going to be divided among the participants? No one will want to take a reduced payment. One assumes the insurance company would be offering more case volume in exchange for the bundled payment, but obviously that won't in fact be known until after the contract is signed and the bundled payment rate has been locked in. Meredith Warf. Administrator of Madison (Miss.) Physi- cian Surgery Center and Mississippi Sports Medicine and Orthopedic Center (Jackson): With bundled care, the surgery center is now responsible for coordinating postop- erative services and data collection in conjunction with the surgeon teams for several months after the operation. The data collection day of surgery is easy, it's the next several months that can be more of a challenge. The ASC now also has to ensure all strategic partners, including home health and outpatient physical therapy, are aligned with the plan of care and understand the goal of reducing costs while improving outcomes. For us, this included two core leaders of our bundled joint and spine programs who lead on this front. The other challenge is administering the claims when the ASCs are paid — often these bundled payments include four or five strategic partners who must have claims disbursed from the surgery center according to the way the contracts are set up. Tracking these patients, claims and dollars on a large scale is another added administrative burden for ASCs. All that said, we believe the bundled procedure volume will continue to in- crease even faster than in the past. These challenges are also the biggest opportunities for ASCs in the near future. Teleatha Mortimer, BSN, RN. Administrator of Blooming- ton (Ind.) Endoscopy Center: As far as bundled payments, we lose money in many cases because it doesn't cover the costs of extra items used even though they are necessary. If hospitals can line-item bill, why can't ASCs? n

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