Becker's ASC Review

70 Supply Chain R unning an ambulatory surgery center often revolves around expect- ing the unexpected. There are several factors that administrators cannot control, however there is one factor they can: supply spend. "Reimbursement is fixed but cost is a variable you have control over," says Joshua Billstein, a board member of the Washington Ambulatory Surgery Association and practice manager at The Polyclinic in Seattle. Here are 10 strategies for ASCs to effectively cut costs in their supply chain: 1. Select the right business partners. According to Jerry Johnson, vice president, of national accounts, ambulatory surgery center division at Medline, it is important for ASCs to partner with well-established firms who have a track record of sustainability in the marketplace to cut supply chain costs. "Select busi- ness partners that understand and commit to the success of the ASC," he says. Also, looking to partner for the long-term can result in more immediate sav- ings. Short-term relationships are front-loaded with cost recuperation and that prevents more immediate savings realization, says Mr. Johnson. Commit and stick to the commitment through the term of the agreement. Mr. Billstein finds partnering with a buyer very helpful because they have a good understanding regarding the market that your center is in and they may have unique solutions to problems that you have not thought about. 2. Network with colleagues. A greatly under-utilized cost cutting strat- egy is networking with other administrators and talking about common problems, says Mr. Billstein. "We had a tissue provider that went from being a local entity to being acquired by a national service group," he says. "So the prices went up. A number of my colleagues and I talked and they told be about some competing providers who I didn't know about. We were able to shift our business to a lower cost tissue provider." 3. Create physician buy- in. "Truthfully the most in- fluential drivers of savings is the physician staff," says Mr. Johnson. "They also are the ones that are most often the roadblock whether they realize it or not. A physician's willingness to listen to, trial and calmly consider change can make or break the ASC's desire to find products and services that save money." To create buy-in, physicians need to be educated about the costs of the prod- ucts they use. "Once they see the costs, many of them are savvy enough to realize that the variability in supplies results in increased costs. So partner with them," says Mr. Billstein. Physicians are by nature intelligent and high-achievers, he adds, so bringing physicians together and giving cost-per-case presentations at the center will lead to cost savings on supplies. Mr. Billstein suggests blinding the names of the physicians but showing them the cost difference between providers on the same case, which may prompt physicians to ask questions about cost and open up a dialogue. 4. Formulate and articulate a clear mission. The cost-cutting mission needs to be established and adopted at every level. To be successful there must be clearly defined goals for every area related to patient throughput as well as measurements developed to ensure performance at the agreed standards, according to Mr. Johnson. "It is not enough to intuitively understand the need to produce patient care at the lowest cost," he says. "Every member should be told their goals and expectations in terms applicable to their specific area of the organization." One way to do this is to hold team meetings, which includes nurses, office staff, administration, physicians and vendors. Tell them the goals and open up the floor for dialogue. 5. Create post-performance scoreboards. These scoreboards should detail cost reductions against goals for the entire staff to see, according to Mr. Johnson. Making everyone's contributions visible helps keep everyone accountable. "Highlight contributions [from] the broader team individuals that were sig- nificant in reaching cooperative goals," he says. "Scoreboards that demon- strate results to the set goal are very effective. The old saying 'inspect what you expect' should not be lost in the efforts to reduce costs." 6. Establish rewards. After setting goals and expectations, set rewards. "Every contributor ultimately asks themselves 'what's in it for me?'" says Mr. Johnson. "So, explain the reward at the same time the goal is announced. If it's a bonus, a raise, a paid day off, a free lunch or any other incentive — name it!" For more information, call 425-657-0494 or visit our website at www.eveia.com Eveia's Clients: · Ambulatory Surgery Centers · Surgical Hospitals · Health Systems with ASC Relationships · Physician Practices · Anesthesiologists ASC Operations Compliance & Consulting Services Preparing for excellence Provider Business Services Optimizing opportunity Provider Contracting Services Reimbursement experts The Road to ASC Financial Success: 8 Supply Chain Cost-Cutting Strategies By Anuja Vaidya Joshua Billstein

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