Becker's ASC Review

29 Executive Briefing: SPONSORED BY: S ummit Orthopedics has a major presence in Minnesota's Twin Cities with four ASCs, about 30 orthopedic locations and about 860 employees. Becker's ASC Review recently spoke with Summit Orthopedics CEO Adam Berry about the state of and challenges in the ASC market, Summit's growth, Summit's plans to become a future looking ASC with a focus on technology and specialization and how Stryker's ASC business was able to break through during the request for proposal process with its breadth of products, focus on the future and specialization in the ASC market. Driven by vision Summit Orthopedics is guided by its vision to be the premier provider of all musculoskeletal services for patients in its community. This requires offering a broad range of musculoskeletal services. Often, when a patient is in pain, they don't necessarily know what's wrong. They may have hip pain, for example, which is being caused by a back issue. This focus on everything musculoskeletal means, "We have to have a good enough and wide enough range of services to cover everything," Mr. Berry said. For Summit, this expansive vision has meant going upstream to assist employers in creating work environments that prevent employees from getting injured, via their Occupational Medicine programming. It has also meant going downstream to provide clinics, surgery and even telehealth follow up. ASC challenges Summit started its first ASC 22 years ago in 1999, and Mr. Berry has been with the organization for 11 years. During this time, a constant challenge has been communicating the benefits of an ASC to the broader market. In 2012 and 2013, when Summit was putting together its first ASC bundled contracts, payers recognized that bundled payment would save money on each unit but were worried that their total costs would increase because the number of units would increase. Summit had to educate payers at that time about patient selection criteria and that their total costs would decline. Then the education challenge shifted to patients. At the time, patients had the mindset that surgery takes place in a hospital. Also, many patients had no financial incentive to use an ASC since deductibles of $5,000 or $8,000 could be easily exceeded by the $20,000 cost of a procedure. Overcoming this challenge required educating patients about the quality, convenience and overall total cost advantages of ASCs. More recently, the communication challenge has shifted to large employers. These employers want to engage in direct contracting but are frustrated by having to have separate agreements for different clinical areas, such as orthopedics, ophthalmology and more. This has required educating employers about the substantial benefits of ASCs and streamlining the contracting process. Mr. Berry observed that it has been a continual challenge to educate different stakeholder groups about the benefits, costs savings, quality enhancements and overall benefits of ASCs. Constant reinvention Summit has done total joints in the outpatient setting for almost eight years. But looking forward, it is important not to get complacent. It is necessary to figure out what's on the horizon. "Business as usual is not the business of the future," Mr. Berry said, their priority is "to remain relevant in the marketplace," he added. Remaining relevant is a constant challenge, Mr. Berry said, because the market says it cares deeply about quality, but doesn't know how to describe it, and the market says it cares deeply about price, but doesn't know how to shop for it. "The quality and cost concepts are sometimes difficult," Mr. Berry said. The ongoing challenge is to remain relevant and not to be locked into business as usual. Summit's hyper-specialization One way that they have remained relevant is by going beyond the general concept of orthopedics into specialties and subspecialties, which Mr. Berry termed as "hyper- specialization." For example, one of their surgery centers only does procedures from the elbow to the fingertip, while two other surgery centers only do joints and spine. A fourth ASC only does spine injections. Mr. Berry asserted that this focus provides expertise, innovation and nimbleness. ASCs vs. hospitals Over the past decade, as patients, providers and payers have become educated about ASCs, the perception of ASCs has improved, while the perception of hospitals has taken a hit, according to Mr. Berry. He argued many patients no longer want to go to hospitals, due to concerns about COVID-19, cost issues, service issues or other concerns. Mr. Berry said the contrast and advantages of ASCs are evident. ASCs have a smaller feel, are focused on a particular specialty and help patients more smoothly navigate the entire experience. This can include a simpler parking experience, a better experience in the facility and having specialized nurses who deal with fewer patients each day. "We can effectively deliver those touch points differently than the bigger setting that has to be all things to all people," Mr. Berry said. The future of ASCs: How Summit Orthopedics' service line and partnership with Stryker is preparing it for the future

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