Becker's ASC Review

ASC Turnarounds: Ideas to Improve Performance 19 A shifting healthcare environment means changes and struggles to compensate in all provider arenas. Michael McKevitt, senior vice president of business development with Regent Surgical Health reads between the lines as to the delicate balance between hospitals, ASCs and physicians and identifies major trends driving referrals and financial stability. 1. Physician convenience. Old habits are hard to break, but ASC owners and operators can convince surgeons to try something new by providing con- venient and efficient access to services, says Mr. McKevitt. Though the ASC industry has grown to include multiple players, physicians have been and continue to be the driving force. Providing physicians, and their patients, a convenient alternative to the hospital remains one of an ASC's primary goals. But as an industry matures, so does its level of complexity. "A physician's life is far more complicated today than it was 10 years ago. Phy- sicians need to accommodate a diverse audience be it the patient, the payer, the referring physicians or the possibly the expectations of his, or her em- ployer," says Mr. McKevitt. "Not every surgery center can accommodate these demands and be all things to all people." Though there are external forces driving referrals, the ASC that can offer the greatest convenience while demonstrating quality and cost savings is poised to draw the highest case volume. "Physicians want to do surgery at the facility that gives them access with the minimal amount of hassle," he says. "[Additionally] the physician's staff has just as much say on their behavior. Staff members are our greatest ally." Build strong relationships with physician office schedulers and try and implement programs that help save time on the physician's side of the referral equation. 2. Patient preference. Patients are increasingly taking hold of the reins and actively participating in their healthcare decisions. ASCs are subject to physi- cian demand just as much, if not more, as patient demand. If a physician is af- filiated with an out-of-network ASC, some patients will demand an in-network facility given higher deductibles and penalties associated with accessing out-of- network services. This often means cases will shift back to a hospital. The key to meeting patient preference is knowing the referring physicians payer mix within his, or her, practice and implement a managed care strategy that captures the greatest amount of cases. Knowing the cost to provide care on a case-by-case basis is paramount to a managed care strategy. 3. Political intricacies. In a world of black and white, physicians would chose the facility that they believed would best serve themselves and their patients, but reality comes with a great deal more complexity. "Many physi- cians are employed by large groups with contractual obligations that can take precedent over individual preference," says Mr. McKevitt. "Physicians need to be loyal to their hospitals and develop a sense of partnership in the future." Even independent physician groups relatively free of political ties in the health- care field are not immune. The recent trend of hospitals to employing special- ists has not gone unnoticed. Though it remains to be seen whether or not the pendulum will swing away from hospital employment, a continued trend of hospital-physician acquisitions could place significant strain on ASC referrals. Mr. McKevitt states, "In many of our physician/hospital ASC joint ventures the forward thinking hospital administrators have been very active in utiliz- ing ASCs as means to increase employed physicians productivity." 4. Economic forces. Low-cost, high quality healthcare is becoming the holy grail of healthcare, and ASCs are perfectly positioned to offer that and should have sustainable market advantage for years to come. Payers are be- ginning to recognize the cost-savings ASCs can provide. "CMS has recog- nized the cost savings associated with ASCs and continues to expand the scope of services allowable in the ASC setting," says Mr. McKevitt. Hospital leadership is slowly coming to the realization that an ASC strategy that includes the larger physician community is a key initiative when dealing with ACOs and sharing financial risk for a defined patient population. How joint ventures affect ASC referral depends on the situation. "If the referral base of surgery center is already aligned with hospital partner, it only builds that referral base. If a hospital is competing, they are then more guarded in their referral patterns," says Mr. McKevitt. "Everyone is looking at ASCs as a source of unlimited upside potential. The ability to align the economic interests with the interests of physicians and provide the highest quality of care to patients at the lowest cost is invaluable." 5. Advances in technology. Continued forward momentum in technol- ogy is allowing higher acuity cases to move to the ASC. As this trend contin- ues, physicians, patients and payers will recognize this value and drive more cases to surgery centers. New techniques in anesthesia and new surgical ap- proaches combined with low-infection rates and costs position ASCs for a significant number of referrals. 6. ACO avenue. Whether or not the ASC industry is a natural fit with ac- countable care organizations has yet to be determined. "ASCs by the nature of their ability to control costs and produce higher patient satisfaction fit well with population health management," says Mr. McKevitt. "This provides a sustainable advantage for referrals, but the real question is, to what extent will ASCs be com- pensated in the future." The ACO model is in its infancy, but if reaches maturity it will almost certainly impact referrals to ASCs, and only time will tell in what way and if the current advantages provided by ASCs are sustainable. n Physician-Centric Model Proven Track Record of Enhancing Profitability & Driving Operational Efficiencies Expertise in Management Development Acquisitions Ambulatory Surgical Facilities Leading national ASC company with 47 ASCs spanning 18 states VISIT SurgeryPartners.com OR CONTACT US AT BusinessDevelopment@surgerypartners.com ASC Referral Patterns: Deciphering 6 Big Industry Trends By Carrie Pallardy

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