Boulder (Colo.) Surgery Center, covering orthopedics, sports medicine and pain management, is co-owned by its physicians and 265-bed Boulder Community Hospital. Pinnacle III manages the center. Most of the 21 affiliated physicians are owners of the center, which has three ORs and a pain management suite.
Here Jill Sellars, business manager at the ambulatory surgery center, lists six benefits of Boulder Surgery Center's relationship with the hospital.
1. Allowing physician autonomy. The hospital opened an HOPD in 2000, but a few years later, but orthopedic surgeons at the facility started to make plans for their own ASC. "They didn't feel they were getting enough block time on the schedule," Ms. Sellars says. "The hospital's response was, 'Let's not lose you. Let's become collaborating partners.' " The hospital and physicians opened the ASC in 2005 under a 50-50 ownership plan with the hospital as "silent partner," not involved in day-to-day management.
2. Accessing favorable payor rates. The ASC uses the clout of the hospital to get very favorable contracted rates from payors. The contracts are separate, but "the same people who negotiate the contract for the hospital negotiate our contracts," Ms. Sellars says. While the ASC's rates are not as favorable as the HOPD's, they are much better than what ASCs typically get. "We have an incredible advantage in negotiations," she says.
3. Collaborating on schedules. "The hospital and the ASC work together on scheduling," Ms. Sellars says. "If a case can't be done at the ASC, it will go to the hospital." She is on the phone with the surgery scheduler at the hospital several times a day, discussing cases. "There's a lot of back and forth," she says. If one of them can't fit in a case, the other will take it up, as long as it is clinically appropriate and there is an opening on the schedule.
4. Accepting cases so patients pay less. Since surgery rates are lower at the ASC than at the hospital, hospital financial counselors often send cases to the ASC when the patient has to pay high out-of-pocket charges but earns too much money to qualify as an indigent case. Ms. Sellars is frequently on the phone with financial counselors discussing these cases.
5. Trading equipment and supplies. Although the ASC is responsible for its own purchasing, in a pinch it can trade equipment and supplies with the hospital's surgery suites just across the street. "They borrow from us and we borrow from them," Ms. Sellars says. "If we don't have a kit for a specific surgery, such as an allograft, we call on the hospital to see if we can get one from them."
6. Sharing services. While the ASC pays for its own services, it shares volume discounts used by the hospital for certain services, such as dictation and telephones. The hospital is installing an electronic health records system, but the ASC won't be connected to it, at least for now. "We may have to join it in the future, but the surgeons here prefer paper records," Ms. Sellars says.
Are there any negatives to linking up with a hospital? "I can't think of any," she says, "except maybe that some physician-owners might not like having to share profits with the hospital." However, she has not heard these concerns from her surgeons.
Learn about Boulder Surgery Center.
Learn more about Pinnacle III.
Related Articles on Surgery Center Joint Ventures:
4 Issues for Hospitals in Choosing HOPD or ASC Venture With Physicians
New Surgery Center Joint Venture Partnership Between Connecticut Orthopedic Group and Hospital
5 Problems That Hurt a Hospital-Physician ASC Joint Venture -- and How to Avoid Them
Here Jill Sellars, business manager at the ambulatory surgery center, lists six benefits of Boulder Surgery Center's relationship with the hospital.
1. Allowing physician autonomy. The hospital opened an HOPD in 2000, but a few years later, but orthopedic surgeons at the facility started to make plans for their own ASC. "They didn't feel they were getting enough block time on the schedule," Ms. Sellars says. "The hospital's response was, 'Let's not lose you. Let's become collaborating partners.' " The hospital and physicians opened the ASC in 2005 under a 50-50 ownership plan with the hospital as "silent partner," not involved in day-to-day management.
2. Accessing favorable payor rates. The ASC uses the clout of the hospital to get very favorable contracted rates from payors. The contracts are separate, but "the same people who negotiate the contract for the hospital negotiate our contracts," Ms. Sellars says. While the ASC's rates are not as favorable as the HOPD's, they are much better than what ASCs typically get. "We have an incredible advantage in negotiations," she says.
3. Collaborating on schedules. "The hospital and the ASC work together on scheduling," Ms. Sellars says. "If a case can't be done at the ASC, it will go to the hospital." She is on the phone with the surgery scheduler at the hospital several times a day, discussing cases. "There's a lot of back and forth," she says. If one of them can't fit in a case, the other will take it up, as long as it is clinically appropriate and there is an opening on the schedule.
4. Accepting cases so patients pay less. Since surgery rates are lower at the ASC than at the hospital, hospital financial counselors often send cases to the ASC when the patient has to pay high out-of-pocket charges but earns too much money to qualify as an indigent case. Ms. Sellars is frequently on the phone with financial counselors discussing these cases.
5. Trading equipment and supplies. Although the ASC is responsible for its own purchasing, in a pinch it can trade equipment and supplies with the hospital's surgery suites just across the street. "They borrow from us and we borrow from them," Ms. Sellars says. "If we don't have a kit for a specific surgery, such as an allograft, we call on the hospital to see if we can get one from them."
6. Sharing services. While the ASC pays for its own services, it shares volume discounts used by the hospital for certain services, such as dictation and telephones. The hospital is installing an electronic health records system, but the ASC won't be connected to it, at least for now. "We may have to join it in the future, but the surgeons here prefer paper records," Ms. Sellars says.
Are there any negatives to linking up with a hospital? "I can't think of any," she says, "except maybe that some physician-owners might not like having to share profits with the hospital." However, she has not heard these concerns from her surgeons.
Learn about Boulder Surgery Center.
Learn more about Pinnacle III.
Related Articles on Surgery Center Joint Ventures:
4 Issues for Hospitals in Choosing HOPD or ASC Venture With Physicians
New Surgery Center Joint Venture Partnership Between Connecticut Orthopedic Group and Hospital
5 Problems That Hurt a Hospital-Physician ASC Joint Venture -- and How to Avoid Them