What this CEO did to save an ASC slated for closure

Hilo Community Surgery Center in Hawaii was slated for closure — until Frederick Nitta, MD, took over as CEO.

Dr. Nitta, an obstetrician-gynecologist, joined Becker's to share the most effective changes he made to financially revitalize his ASC.

Note: Response has been lightly edited for length and clarity.

Question: What are some investment opportunities in the ASC industry?

Dr. Frederick Nitta: There are many opportunities, but backing up from this, the ASC needs to be run efficiently. Costs must be held down, supplies need to be researched and coders need to be able to get involved to ensure maximum reimbursement.

Let me explain what I mean by the above. I was picked to become the CEO of Hilo Community Surgery Center in October 2023. The board had already voted to close it down. 

Once I took over the management of the surgery center, dozens of problems were identified. As far as the overhead side, employees were overpaying themselves every month, not negotiating contracts, charging for overtime when they did not even work 40 hours in that week, and hiring friends and family members to do repairs at hugely inflated prices. There also was no receipt book kept for cash. An example is a $2,000 charge to unclog a toilet. Another is that packs to do cataracts were $200 to $300 a case. We now pay less than $20 for similar packs. 

Maximum reimbursement was not pursued, as the coder was untrained. Multiple procedures were not paid, secondary insurance claims did not go out, and even patients' copays were never billed. Now, we have certified coding specialists who are accredited by the American Health Information Management Association on staff who are bringing in more than double what we received in the past.

Now that the surgery center is doing better, we are adding plastic surgery, expanding orthopedics, and doing major gynecological procedures on an outpatient basis. 

There are opportunities, but ASCs need to be properly managed, run efficiently, and not used as a piggy bank for employees or its owners.

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