Becker's Hospital Review

84 POPULATION HEALTH 84 CEO/STRATEGY Is it too late to pursue an ASC strategy? 5 thoughts with Todd Mello By Kelly Gooch H ospitals and health systems contin- uously look at strategies for ambula- tory surgery centers, including joint ventures and acquiring ownership. In fact, HealthCare Appraisers' 2017 ASC survey found 50 percent of respondents have sold a controlling ASC interest to a hos- pital or health system. Not all hospitals and health systems are participating in this trend because of their desire to preserve certain in-house surgical revenue streams and maintain control of outpatient business joint ventures. But Todd Mello, senior vice president with e Bloom Organization's consulting services division, sees it as a good idea as healthcare moves outside the hospital, where treatment is gen- erally less expensive for patients. Here, Mr. Mello offers five thoughts on why hospitals and health systems should pursue an ASC strategy if they haven't done so already. 1. Changing healthcare environ- ment. Hospitals and health systems face in- creased pressures to reduce costs amid the industry's shi to value-based care. To achieve success in this area, Mr. Mello believes it is cru- cial to have ASCs as part of an organization's continuum of surgery. He argues hospitals and health systems that don't have ASCs will contin- ue to see "leakage" of "ASC-eligible" cases away from the hospital to community-based ASCs. "If you continue to put your head in the sand and try to basically hoard cases in the hospital to maximize revenue today, in the long term you will be mistaken because you will lose mar- ket share to competitors who have embraced the philosophy," says Mr. Mello. "Competitors are wooing all these doctors, and you will lose them unless you're willing to do that [surgical] work in an ASC as well. Payers will continue to redirect patients away from those hospitals who do not have ASCs, and, with a significant increase in high-deductible plans, patients will continue to shop for surgical alternatives with lower out-of-pocket costs." 2. Physician relationships. Mr. Mello believes physicians are able to run efficient, high-quality ASCs with good return on invest- ment for hospitals. He says hospitals that have successful joint ventures with physicians see various benefits, including improved physi- cian relationships. "Further, identifying a rep- utable, knowledgeable, third-party manager (as opposed to the hospital itself) increases the odds for a successful joint venture and creates necessary 'separation' to buffer [the] hospital from potential surgeon criticism and potential relationship strain should management issues arise," says Mr. Mello. 3. Payer contracts. Hospitals and health systems that are big players in their market generally have good leverage when negotiat- ing payer contracts. Mr. Mello says hospitals with successful ASC joint ventures can bring that leverage to an ASC if they are a majority owner of that center. is means the ASC may receive higher reimbursement than it would have as a non-hospital affiliated freestanding facility. "So, physicians can sell an interest in the ASC to the hospital of at least 50.1 per- cent, and distributions may not change much because hospitals' contracts are much better such that the center is more profitable," he says. at is why ASCs benefit from the joint venture relationship. He says payers also like the idea because they're negotiating to take certain surgical procedures out of the costlier hospital setting. 4. Service/capacity issues in hospital operating rooms. Hospitals that lack ASCs or dedicated outpatient ORs try to fit outpa- tient elective cases in their main inpatient ORs. Mr. Mello says this is inefficient because oen outpatient elective surgeries are delayed when emergent cases come about. Patients and physicians are both unhappy when that occurs because they have set aside a specific timeframe out of their day for the procedure. Mr. Mello says hospitals with ASCs are able to save the main ORs for emergent and/or more intensive inpatient cases and leave the outpa- tient ASC-eligible cases to be performed in a lower-cost setting. 5. Physician and patient satisfac- tion. Hospitals depend on physicians to refer cases to make their hospitals viable. ere- fore, physician satisfaction is important. Mr. Mello says physicians are not pleased when OR turnover time between outpatient cases is long in hospitals. ASCs generally are more efficient and have faster turnover times with these cases since they are not also balancing inpatient surgeries. at "makes for happy surgeons who are able to perform their des- ignated cases in a shorter time period, freeing them up for more time to see patients in the office or other duties," says Mr. Mello. "Simi- larly, patients experience less delays and a bet- ter, more cost-effective overall experience." n MedStar Health appoints first-ever chief scientific officer By Alia Paavola C olumbia, Md.-based MedStar Health selected Neil Weissman, MD, to serve as chief scientific officer, a newly-created executive leadership position. In his new role, Dr. Weissman will help deepen the health system's position as a nationally recognized academic health system. He will lead the implementa- tion of scientific priorities, develop research infrastructure in partnership with its clinical partner Washington, D.C.-based Georgetown University, and help enhance MedStar's national reputation. Dr. Weissman currently serves as the president of the MedStar Health Research Institute and as a professor of medicine at Georgetown University. He will keep both of these roles. "I am honored to be MedStar Health's first chief scientific officer and excited about our potential to become a nationally acclaimed academic health sys- tem," Dr. Weissman said. "MedStar Health is well positioned to help create the next wave of academic medicine — one in which we find the synergistic poten- tial of large healthcare systems to improve the health of our communities and leverage the importance of academic partnerships." n

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