Becker's ASC Review

21 THOUGHT LEADERSHIP The factor that could make or break ASC success By Patsy Newitt O perating independently is becoming increasingly difficult, and many leaders feel that having strong leadership and management is the key to maintaining viability. Jim Freund, managing partner for Physician Transaction Advisors, joined Becker's to discuss the secret to long-term success for ASCs. Editor's note: Responses were edited lightly for clarity and length. Question: What is the key to success for ASCs? Jim Freund: Number one is strong leadership from the physicians. We've completed about 300 transactions, but we've probably worked with three times that many groups over the years. I've learned that strong leadership is at the top of the list. When you're putting together a great team, and that includes physician partners, physicians who may practice there, your administrative staff, your clinical staff and your business staff, all of that is what makes for a successful center. Q: What are the dangers of not having this strong leadership? JF: We hear from a lot of physicians that they are considering a strategic partnership because they realize at some point they're gonna get older and need to transition their facility. For facilities that don't properly plan for the future, that's when you hear about them closing or being challenged moving forward. That's typically because they don't have a transition plan. They either haven't partnered, they haven't brought on additional physicians or they haven't been willing to create a larger organization. That's all a lack of planning and a lack of ability to transition. Oftentimes, they're waiting until it's too late to bring on a partner to help them grow, recruit or improve our contracts that bring scale. No strong leadership often means no adequate planning, preparation, ability to transition, etc. As physicians approach retirement is when we most often see this search for partners or solutions, but oftentimes it needs to happen five to 10 years earlier. That's the biggest challenge we see. Also, obviously, costs are high and running a practice is financially more challenging today than it was 20 years ago or even 10 years ago. Everything is more expensive — personnel, staff, supplies, etc. If you don't have the scale and the ability to effectively manage all that, then it becomes a bigger challenge for independent facilities. n How single-specialty ASCs may have an advantage By Paige Haeffele A s the ASC market becomes increasingly competitive with more players vying for market share, a successful strategy may be the difference between ASCs that thrive and those that struggle. Becker's connected with Benjamin Stein, MD, an orthopedic surgeon who co-founded and is now chairman of ASC development group Capital Surgical Solutions, to discuss how single-specialty facilities may be the future leaders of the ASC market. Editor's note: Responses have been edited lightly for length and clarity. Question: Do you think single-specialty ASCs are better positioned to succeed in the industry? Dr. Benjamin Stein: I really think that's the case in general. A lot of the larger surgery centers, many of them are broad, multispecialty centers, which I think is a significant flaw in some respects, because when you're trying to get ahead, it's all about routine. If you look at it from a clinical perspective, catering to the clinical deployment of a single specialty means your staff — your sterilization departments, both operating room and recovery staff, anesthesia staff — will all be much more knowledgeable, efficient and targeted in the care they provide if they can focus on one specialty. When they have more variance, it's going to cause them to be less attuned to that predictable routine. I do think it's a disservice that way, as well as economically, because when you're having to deploy equipment and build implantable goods or disposable goods on a broad array of specialties, you're inherently going to have more inefficiencies, because even when you do single specialty, it's hard to be perfect on your inventory. It has the potential to lower quality of care, and it basically inflates your cost to some extent, because you're not as apt to be able to control costs when you treat anything that comes through the door. Doing that huge variety of things makes things harder to control. I think on all sides, it's better for everything to be more focused on a single specialty, because I think that delivers the best care and ends up with the best outcomes. Q: Is that something you've had to sell to other surgeons and ASCs you've partnered with? BS: I don't have to spend too much time selling because we operate mostly in the musculoskeletal sphere. I think it doesn't hurt for me to reinforce the idea, but it's something most surgeons are realizing — that the first "wave" of ASCs, which are from like, 2000-2010 when it was the out-of-network model, a lot of them were multispecialty. I think those who tried to stay that way have struggled, as opposed to the newer generation of facilities that continually become more and more narrow focused, because that's going to lead to the best quality of care. I'm sure that the CMS approving more procedures nearly every year will contribute to that as well. n

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