Jay Rom, president of Blue Chip Surgical Center Partners, makes six points on the future of ambulatory surgery centers.
1. Recession is dragging on. "The biggest challenge is the overall economy," Mr. Rom says. The economy is hard to predict. "One day things are getting better and the next day they are getting worse again." He thinks consumer confidence is a self-fulfilling prophecy. "When people feel good about the economy, they will start spending," he says.
2. Surgery volume has fallen. Volume has fallen somewhat for Blue Chip ASCs but it will have to rebound eventually. "Patients have been putting surgery off for as long as they can," Mr. Rom says. "However, if someone has a knee that needs surgery, sooner or later they'll need to get it done.
3. Reform will boost ASCs. The details of the healthcare reform law still have to be worked out, but there is nothing in reform that is overwhelmingly terrible for ASCs. "We don't know exactly what healthcare reform would do, but surgery centers continue to be part of the answer," he says.
4. High deductibles favor ASCs. "The increase in consumer-directed health care has put ASCs in a better position than hospitals," Mr. Rom says. Patients with high deductibles are looking for lower charges with the same quality, and that would be ASCs.
5. New growth in ASCs. There were very few new ASCs in 2009 but there has been a modest increase in volume in 2010 because healthcare reform has made physicians more optimistic. "Financing is not easy, but a lot of banks are still interested in lending money to surgeons," Mr. Rom says. "We opened a couple of centers in 2009 and by the end of 2010 we'll have added four more centers."
6. ASC industry is maturing. A lot of surgery centers were developed have opened in the past five to 10 years, so the opportunity to develop new centers has lessened. "It's a mature market," Mr. Rom says. Blue Chip has switched from exclusively dealing with new centers to dealing in acquisitions as well.
Learn more about Blue Chip Surgical Center Partners.
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