Becker's ASC Review

6 ASC MANAGEMENT Are ASCs the missing puzzle piece in boosting hospital margins? By Patsy Newitt H ospitals continue to look to ASCs for growth opportunities as they face mounting financial pressures and struggle to maintain operating margins. A recent survey of health system executives by VMG Health found that 60% of leaders were considering pursuing outpatient surgery joint ventures in 2024 — the highest area of interest of any potential specialty partnerships. "Historically, health systems didn't always embrace surgery centers because of the financial impact and perceived competition. But now, a lot of health systems view ASCs as an important part of their delivery network and want to be involved in a bigger way," Aric Burke, CEO of Phoenix-based Atlas Healthcare Partners, told Becker's. St. Louis-based Ascension is looking to ASCs for its growth plans amid a $3 billion operating loss in fiscal 2023. Ascension has added 21 ASCs over the last three years and aims to grow that number to more than 100 in the next few years, President Eduardo Conrado told Becker's in an interview. Bon Secour Mercy Health System, a 48-hospital Catholic system, is also looking to ASCs through a joint venture to build out more than 30 ASCs with Raleigh, N.C-based Compass Surgical Partners. "e rise of healthcare consumerism means patients are more informed and selective about their care options, favoring ASCs for their convenience, lower costs and quicker recovery times," consultant Ankura said in a Sept. 10 blog post."ese economic pressures drive the growth of ASCs as payers seek to reduce healthcare costs through lower- cost sites of care than traditional hospital-based surgical platforms." According to the post, ASCs also allow health systems and hospitals to better align with independent physicians in their market. By buying into an ASC, physicians gain equity, aligning incentives with hospitals and health systems. Additionally, amid an industry shi to site-neutral payments, ASCs also provide an avenue to access alternative payment models and align with value-based imperatives, according to the post. And as commercial payers increasingly eye the cost-savings potential of ASCs, hospitals and health systems should "shoot to where the puck is going" to meet margins, Mike Slubowski, president and CEO of Livonia, Mich.-based Trinity Health, told Becker's. ASCs also provide an opportunity to enter a new market, particularly booming suburban markets. At the Morgan Stanley conference on Sept. 5, Nashville, Tenn.-based HCA Healthcare's CEO Sam Hazen said that HCA is aiming "to extend the reach of our network for our patients, make it more convenient for them to start their process of care somewhere in the HCA system." He said its approach is to "take as many outpatient facilities as we possibly can and make it closer to the patient." "We think we have a unique portfolio of communities inside of HCA that are benefiting from some of the national migration that's taken place, to Texas, to Florida, to Tennessee, to South Carolina, to Utah," he said. "I can go down the list and pretty much all of our communities, I think, are benefitting from some of that and it's really given us an opportunity to invest further in our network model." And while ASC investment is costly upfront, the payoff is worth it. In the blog post, Ankura discussed a client that saw a $6 million reduction to the hospital's bottom line when migrating outpatient surgeries to an on-campus ASC, but by freeing up operating room capacity for higher revenue-generating inpatient cases, the move resulted in a net gain to operating margins. "Our biggest growth is in outpatient care. Some think we are only a hospital system, but only about 46 percent of our business is from our hospital sector today," New Hyde Park, N.Y.-based Northwell Health CEO Michael Dowling told Becker's. "e more you expand ambulatory and grow in the right locations, the more you increase market share, which brings more of the necessary inpatient care back to your hospitals." n ASCs still offer nurse sign-on bonuses By Laura Dyrda H ealthcare jobs are the most likely to include signing bonuses among all job posts on Indeed. com, according to The Wall Street Journal, and surgery centers are still using them to attract talent. During the pandemic when competition for nurses in particular heated up, hospitals offered five- and six- figure signing bonuses, and more ASCs began offering them as well. The market has cooled since then, but some surgery centers still list signing bonuses on the job descriptions. Current ASC nurse openings with signing bonuses include: • Franciscan Orthopedic Surgery Center in Carmel, Ind., is offering up to $7,500 signing bonus for a registered nurse to work eight or 10 hour shifts at the center. • DMC Sinai-Grace Hospital in Detroit is searching for a full time RN at its Berry Surgery Center with up to $25,000 sign-on bonus based on experience. • University of Iowa in Iowa City is searching for a staff nurse with up to a $10,000 sign-on bonus based on experience. • Peoria, Ill.-based OSF HealthCare is looking for an RN to join their general surgery clinic with a $5,000 sign-on bonus Even if the job description doesn't include a signing bonus, some are pulling them in anyway. The Journal reported around 70% of people who received a signing bonus in the last two years requested it after receiving an initial offer. n

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