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Implant costs a 'race to the bottom' with ASCs, administrator says

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As higher-acuity procedures move to outpatient, ASCs must be sure to consider the cost of implants in commercial payer contracts. 

Andrew Lovewell, administrator at Surgical Center at Columbia (Mo.) Orthopaedic Group, spoke with Becker's ASC Review on how implant costs are hurting ASCs. 

Note: This response was lightly edited for style.

Question: What are your biggest challenges with insurance payers?

Andrew Lovewell: I think the future holds some very large challenges for ASCs in regard to insurance payers. As we transition higher-acuity cases to surgery centers, there is this inherent cost factor associated with doing that. 

Commercial contracts have to be well constructed to ensure that hardware and implants are being paid on all of those extremely complex procedures. In the world of CMS total joint arthroplasty within an ASC, implant costs mean everything. At some point, many administrators and surgeons may feel that there is a race to the bottom, and that simply can't happen. ASCs were designed to be a streamlined healthcare delivery model, but there is still an inherent cost of doing business.

In today's world, there's a well-known process, responsibility, duty, etc., of ASCs to continue to "proof out" that they can deliver value and cost savings to insurance payers. With that said, there isn't always as much reimbursement after the burden of proof as one would think. 

Many ASCs are fighting uphill battles to get coverage of procedures so they can begin doing them, and many payers want to see outcomes and data to show that you know what you are doing — the old chicken and egg analogy. Aligning payers, employers and providers to deliver a cost-effective product to patients should be the goal. At the end of the day, ASCs exist simply to provide cost-effective, convenient and patient-focused care in the markets they serve.

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