Five ASC leaders recently joined Becker's to discuss how reimbursement issues remain one of the biggest challenges for surgery centers in many markets.
Aric Burke. President and CEO of Atlas Healthcare Partners: Everything is more expensive. Even though reimbursement has technically gone up, so has the expense side. That puts a lot of strain on the profitability of ASCs. You have to manage costs more effectively than before. You have to have a really strong financial plan that not only focuses on cost control, but also growth. Ultimately, you have to be able to have growth through strong physician recruiting, retention, having service lines and other strategies. Being affiliated with a big health system has been effective in driving growth.
Marsha Haley, MD. Clinical Assistant Professor of Radiation Oncology at the University of Pittsburgh: Declining reimbursement is a huge issue that leads to many other problems. Physicians do not receive an inflationary reimbursement update — in fact, Medicare physician pay has declined over 20% over the past 10 years. With inflation resulting in rising overhead costs, it becomes more difficult for private practices to remain viable. These practices are then vulnerable to purchase by large, vertically integrated health systems. Physicians and their patients may then become victims of the corporate practice of medicine, which results in increased physician burnout and a decline in the quality of care.
Matt Kraemer. Administrator of Northern Arizona Healthcare in Flagstaff: The biggest threat to ASC growth currently continues to be reductions in reimbursement that creates a difficult situation for the ASC to accommodate certain cases. Many times the operational costs to perform a case outweigh the reimbursement for that case. Rising costs of implants and medical supplies, staff labor and non-medical supplies continue to increase with the economic inflation associated with doing business, however, the reimbursement of these cases continue to fall. Many patients and providers prefer to have their procedures and surgeries performed in the ASC setting due to an enhanced experience, increased ease, faster operating room turnovers and reduced cost to the patient. Therefore, the ASC has to balance the dichotomy of maintaining a financially sustainable business, while accommodating providers and patients in an effort to grow their volumes.
Amber Lawler, RN. Administrator of Proffer Surgical Center (Amarillo, Texas): I feel like our biggest challenge is the amount ASCs are allowed to be reimbursed by insurance. The cost of performing surgery continues to rise, and our insurance reimbursement rates have not. ASCs are often performing the same surgical procedures as hospitals but are reimbursed by insurance at a much lower rate.
Taif Mukhdomi, MD. Interventional Pain Physician at Pain Zero (Columbus, Ohio): Unfortunately, physicians are losing money in multiple scenarios in medicine. The most prominent loss of physician revenue is Medicare's consistent decreasing of physician reimbursement in office settings while supporting hospital-setting healthcare services. This trend affects all insurances, as Medicare is the benchmark of most if not all healthcare insurance reimbursement.