ASCs are growing, but 5 threats remain

ASCs had a breakout year in 2020 as more cases migrated to outpatient centers while inpatient hospitals focused on COVID-19 patients.

It's been shown ASCs can handle more complex cases as a high-quality, low-cost care setting. What threats remain to growth? Four industry leaders discuss key issues.

1. Certificate-of-need policies

Mark Schwartz, CEO of Blue Ridge Orthopaedic & Spine Center (Warranton, Va.): There needs to be additional ASC development as a safety valve in our healthcare delivery system, such as we experienced with COVID-19. The ASC becomes the safety valve to continue to care for patients who need elective procedures such as colon surgery, other general surgery and orthopedic surgery.

If there was a lesson learned from COVID, it is that without safety valves such as ASCs, patient care is negatively impacted given the canceling of elective surgical cases at hospitals, which delays care and impacts the patient and which also clogs up the hospital system. The system becomes more inefficient as singular events can literally shut down a system.

I would hope that in healthcare planning that while looking for efficiency, sometimes it is better to create buffers in the system to provide a relief valve and to allow for critical flow. I would hope that hurdles for ASCs are reduced which should also allow for improved consumer choice, as well as pricing.

In certificate-of-need states, the commoditization of CONs is hopefully lessened as it creates a further barrier on ASC development, namely creating a need to have a higher return to get over the initial cost of obtaining or purchasing a CON, and to further allow the taking care of the most needy in our population, who often do not want to travel as far — namely seniors in a community.

2. Increased regulations

Rommel Gonzaga, MD. CEO of Gonzaga Health (LaVale, Md.): In the interventional pain management space, it has become increasingly difficult to practice in a pain specialty due to scrutiny from many different organizations. These organizations range from government agencies, such as CMS, OIG, DEA, to various state medical boards. The primary focus has been to provide initiatives to curb the opioid epidemic, but in recent years there's even expanded scrutiny on interventional procedures and in-office ancillaries.

A retrospective look at nefarious pain management practitioners/practices doesn't help the case of pain practitioners who are legitimately in the business of providing care to patients who suffer from chronic pain and who do not engage in fraudulent criminal conduct. These issues, coupled with the fact that plummeting reimbursement rates for pain management, stringent coverage policies, burdensome prior authorization processes only create additional obstacles to operate and resume operations in a postpandemic world.

The only thing we are seeing is an increase in patient dissatisfaction with their care. These issues contribute to provider and staff burnout and ultimately the ability for a practice to continue operations. Administrators need to be compassionate, flexible and creative while staying compliant with government regulations in the hopes of keeping their practice doors open.

3. Prior authorizations

Gerald Harmon, MD, American Medical Association Board of Trustees: More than three years after a landmark consensus statement signaled insurers were open to reforming the arduous prior authorization process, physicians are still bedeviled by this unnecessary bureaucratic obstacle that delays and disrupts patients' access to necessary care. In an AMA-conducted survey of physicians, 83 percent of respondents indicated they've seen an increase in prior authorizations for medications and medical services in the last five years. Eighty-seven percent of respondents said prior authorization interferes with continuity of care. Given that these obstacles were not eased during the COVID-19 pandemic, the AMA is skeptical they will be eased without congressional action, which is why we support the Improving Seniors’ Timely Access to Care Act (HR 3173), a bill that takes direct aim at the insurance industry’s foot-dragging and would codify much of the consensus statement.

4. Consolidation

Joe Peluso. Administrator at Aestique Surgery Center (Greensburg, Pa.): Consolidation provides market power to leverage negotiating higher payments from commercial insurers and thus higher premiums passed onto patients, while standalone hospitals and/or ASCs are paid lesser payments.

Physicians employed by hospitals are more likely to provide outpatient surgical services in the hospital than lower cost freestanding ASCs. Medicare patients are currently insulated from these tactics because Medicare sets prices administratively. However, commercial insurance pricing may create pressure to increase Medicare pricing.

5. Medicare's payment structure

Joe Peluso, administrator at Aestique Surgery Center (Greensburg, Pa.): As CMS continues to support the transition of surgical procedures from hospital outpatient departments to ASCs, where surgery is performed at lesser cost, these more complex procedures require additional expensive supplies. The ASCs need to have similar price breaks on supplies that the larger healthcare systems enjoy. CMS needs to provide reimbursement for these supplies to achieve the cost savings provided by ASCs.

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