Surgery Business

JANUARY 2025

SURGERYBUSINESS.COM

THE MONETARY DYNAMICS OF SPINE SURGERY MAXIMIZING PROFITS IN HAND SURGERY OUTPATIENT TOTAL JOINTS GYNECOLOGY IN ASCs: AN UNTAPPED GOLD MINE IDIOT’S GUIDE TO ASC BUY-INS

THE FINANCIAL VIABILITY OF

ORTHOPEDIC SURGERY

W E LC O M E

You are the right person in the right place at the right time.

Imagine a training curriculum that includes all the different aspects of medicine—heart, lung, pathology—but neglects to discuss the brain. That would be a glaring elision, if not an outright absurdity. And yet, a similar illogicality occurs in the same institutions, albeit in a different context, but with equally troubling consequences. That is the failure to discuss and teach the business aspect of healthcare to minds in training.

What we see as a product Shakeel Ahmed, M.D. of this exercise is a highly Editor-in-Chief qualified individual, wellversed in all the different aspects of medicine, but completely unprepared to run the business of it all. This is not just an omission; it’s a profound disservice that creates practitioners who may be experts in saving lives but novices in sustaining the business of healthcare.

Here’s a word to the altruistic. There is no greater good in your self-effacement here, for others will still benefit as they ride on the coattails of your excellence—just not you.

T. Harv Eker once said, “It’s not enough to be in the right place at the right time. You must be the right person in the right place at the right time.” Life reflects that thought. The business of medicine reflects that thought. Your career will be an exercise in financial futility if you jump into it loaded with the wisdom of science but devoid of the art of finance.

Course after course, class after class in medical school imbues in us the intricacies of surgery.

Incisions. Sutures. Emergencies. The weight of it all is so Herculean that the learning mind never stops to ask if there is more to life than cuts and ectomies. Your clinical knowledge will not fuel your bank account. How you apply yourself in life

will. Otherwise, you will be a serf to the wishes and follies of all the healthcare administrators that are waiting to cash in on your naivete. Financial ignorance will follow you through your journey of vocational servitude for the rest of your life. You will learn in time, but every mistake will set you back by a thousand fiscal steps.

Or you will fall slave to an ever-compounding cycle of constant shortfalls in your pecuniary holdings. The burden will weigh you down even more into the dungeons of monetary weakness until you give in to a life of budgetary mediocrity, full of medical knowledge and wisdom, but not much else. As Shakespeare would put it, “Full of sound and fury, signifying nothing.”

The knowledge of finance, of business acumen, is out there, just not widely shared and palpably missing a platform to air it. And that’s where we make the grand entrance of Surgery Business magazine, a platform for medical minds to meet and share their wisdom. It’s a gathering place for the best in the business to impart monetary wisdom to the next generation of healers.

Having spent a quarter-century building Ambulatory Surgery Centers and a plethora of other business entities, I felt it was my divine duty to share the wealth of knowledge I have accumulated and to welcome other minds like mine to do their part. That is what legacies are all about—imparting wisdom when none is called for and sharing your secrets in the absence of a courting audience.

I end with the words of Robert Kiyosaki: “It’s not how much money you make, but how much money you keep, how hard it works for you, and how many generations you keep it for.” Saving lives is the most supreme act we can do as healers.

Nothing takes precedence over that. But it bodes us well to be armed with the knowledge to propel ourselves upward financially as we do so. You owe the former to your patients. You owe the latter to your progeny.

Faber est suae quisque fortunae. Every man is the artisan of his own fortune.

Shakeel Ahmed, M.D.

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INSIDE THIS ISSUE

features

34

The Idiot’s Guide To ASC Ownership

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4 SURGERY BUSINESS

56

Diversification Beyond Surgical Procedures

60

ASC Supply Chain Best Practices

72

Business Breakdown of Common Inpatient and Outpatient Procedures

PUBLISHER ON THE COVER Dr. Nathan Skelley reviews the financial viability of orthopedic care in ASCs, beginning on page 12.

specialties SPINE SURGERY................................................................... 6

Basileus Media Corporation, LLC Shakeel Ahmed, M.D. — Editor-In-Chief Shakeel Ahmed, M.D

ShakeelAhmed@SurgeryBusiness.com

Editorial Assistants Mike Miller Kristen Poelker

ORTHOPEDICS.. .................................................................. 12

Help@SurgeryBusiness.com

PLASTIC SURGERY............................................................. 16 TOTAL JOINT ARTHROPLASTY......................................... 20

SURGERY BUSINESS MAGAZINE 741 INSIGHT AVENUE O’FALLON, ILLINOIS, 62269

GYNECOLOGY. . ................................................................... 26

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INFECTION CONTROL.. ...................................................... 32 HAND & UPPER EXTREMETIES......................................... 46

ADVISORY BOARD Nathan Skelley, M.D. Orthopedic Surgery

ENDOSCOPIC SPINE SURGERY. . ....................................... 54

Ben Burch, M.D.

CARDIOLOGY.. .................................................................... 62

Charles Nathan, M.D.

UROLOGY. . .......................................................................... 66

people you should know ALEJANDRO BADIA, M.D................................................... 25 DEEPTEE JAIN, M.D............................................................30 CHRISTOPHER L. ROBINSON, M.D., PH.D.. . ..................... 42

industry news KNOCK-OUT NEWS. . .......................................................... 19 NEWS FROM SOUTH AMERICA. . ....................................... 43 NEWS FROM EUROPE........................................................44 BRITISH ASSOCIATION OF DAY SURGERY...................... 45 SELECTING AN EXISTING PROPERTY TO RENOVATE FOR AN ASC.............................................. 52 PREOPERATIVE NUTRITIONAL OPTIMIZATION............. 70 BORING BUT CRITICAL...................................................... 82

Spine Surgery

Plastic Surgery

Janet Carlson, MSN, RN, NEBC, FACHE Michael Schifano, M.D. Gynecology

Jessica Becerra, MSN, RN, NEBCA Alejandro Badia, M.D. Orthopedic Surgery

Shakeel Ahmed, M.D. Gastroenterology

Russell Feit, M.D. Pain Management.

Abhishek Srivastava, M.D. Urology

Omar Shakir, M.D. Ophthalmology

Fabrício Galvao

President, Brazilian ASCA

Aaron Medaris

Publisher, Physician Resource magazine

SURGERYBUSINESS.COM

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S P I N E S U RG E RY

The Financial Dynamics of Spine Surgery in Ambulatory Surgery Centers

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BY TONY RASTEGAR, M.D.

Ambulatory Surgery Centers (ASCs) have become a significant force in the healthcare landscape, offering a streamlined and cost-effective alternative to traditional hospital-based surgeries. The field of spine surgery, known for its complexity and specialized nature, is increasingly transitioning into ASCs. This shift is largely because of advancements in minimally invasive techniques, enhanced anesthesia protocols and the ongoing pursuit of cost savings coupled with improved patient outcomes. The financial implications of performing spine surgeries in ASCs are complex, involving considerations of cost efficiency, revenue potential, and reimbursement challenges. This article explores these financial dynamics, shedding light on the benefits, challenges, and future prospects of spine surgeries within ASCs.

COST SAVINGS

_____

One of the most compelling factors driving spine surgeries to ASCs is the substantial cost savings they offer. ASCs typically operate with lower overhead costs than hospitals, influenced by factors such as reduced staffing requirements, streamlined administrative processes and more efficient resource utilization.

A study revealed that spine surgeries conducted in ASCs can be up to 45% more cost-effective than those performed in hospital settings. _____

Lower Facility Fees: Hospitals often impose higher facility fees to cover extensive infrastructure and staffing needs. In contrast, ASCs, with their lean operations, can provide the same surgical procedures at a significantly reduced cost.

Efficient Resource Utilization: ASCs are designed for high efficiency, streamlining processes and minimizing downtime between surgeries. This allows for a greater number of procedures to be performed daily, resulting in lower per-case costs.

Reduced Length of Stay: Spine surgeries conducted in ASCs typically lead to shorter recovery times and quicker discharges compared to hospital settings. This not only reduces inpatient care costs but also lowers the risk of hospital-acquired infections.

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REVENUE GENERATION

For surgeons and healthcare providers, ASCs offer significant revenue opportunities. The financial incentives for performing spine surgeries in ASCs are considerable.

Increased Surgical Volume: The efficiency of ASCs enables surgeons to perform a higher number of procedures within the same timeframe compared to hospitals, leading to increased overall revenue.

Ownership and Investment Opportunities: Many surgeons invest in ASCs, either individually or as part of a group. Owning a stake in the facility allows surgeons to benefit directly from the center’s financial success. This dual role as provider and investor fosters alignment of interests, resulting in better patient outcomes and higher profitability.

Bundled Payments and Value-Based Care: The shift toward bundled payments and value-based care in the healthcare industry aligns well with the cost-effective model of ASCs. By delivering high-quality care at reduced costs, ASCs can secure favorable contracts and reimbursement rates from insurers.

REIMBURSEMENT CHALLENGES

Despite these financial advantages, performing spine surgeries in ASCs is not without its challenges, particularly concerning reimbursement. Overcoming these hurdles is crucial for the financial sustainability of ASCs. Insurance Coverage Variability: Not all insurance plans cover spine surgeries in ASCs. While Medicare and some private insurers have expanded their coverage, discrepancies in reimbursement rates and policies persist, potentially affecting the financial stability of ASCs focused on spine surgeries.

Procedure Approval: Some insurers require pre-authorization for spine surgeries in ASCs, which can delay surgery scheduling and create administrative burdens. Moreover, insurers may impose stringent criteria for approving specific spine procedures in an ASC setting, limiting the range of surgeries that can be performed.

Reimbursement Rates: Reimbursement rates for spine surgeries in ASCs are often lower than those for identical procedures in hospital settings. This discrepancy is partly due to the perceived lower operational costs of ASCs, yet it can impact profitability if not carefully managed.

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S P I N E S U RG E RY

N

FINANCIAL PLANNING AND MANAGEMENT

Neurosurgeons use foreign bodies to stabilize, realign, and correct bone disarray and neurological function. Research into better “foreign bodies” has been neck-and-neck with the progress in miniaturization. The end-plate problems seen in the past with some “cages” used in spinal fusions have been mitigated with subsequent generation cages, including expandable standalone interbody fusion devices. Expandable cages, both vertically and horizontally, have resulted in more end-plate coverage, better sagittal alignment, and the ability to increase the amount of bone graft either around or in the device.

The material used to construct these devices is undergoing brisk research and development to facilitate the body getting along better with the inserted material. Modern interbody fusion cages via minimally invasive implantation techniques (i.e., minimally invasive spinal surgeries or “MISS”) mean less invasive spinal fusion and will shift other traditionally open surgeries to other types of MISS, including transforaminal endoscopic techniques.

These advancements will result in less trauma, fewer complications, and less pain while maintaining and even improving reliable outcomes due to better implant stiffness and spinal stability. _____

As of 2021, 180 ASCs in the U.S. offered minimally invasive spinal surgery. _____

Healthcare analyses indicate that 88% of spinal decompressions and laminectomies and 67% of cervical spinal fusions will be performed in ASCs by 2028. Cervical fusions are on track to increase by 20% before then, while, at the same time, it is anticipated that the preservation of motion will improve by 133%.

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Effective financial planning and management are essential for the success of spine surgeries in ASCs. The following strategies can optimize financial outcomes: Cost Management: Controlling costs is vital. This includes negotiating favorable terms with suppliers for surgical equipment and implants, optimizing staffing levels and reducing waste. Regular financial audits can help identify areas for cost reduction.

Contract Negotiations: The negotiation of contracts with insurers and payers is a critical aspect of financial management. ASCs should leverage their cost-efficiency and high-quality outcomes to secure favorable reimbursement rates. Building strong relationships with payers can also facilitate smoother preauthorization processes.

Revenue Cycle Management: Efficient revenue cycle management ensures timely billing and collections. This involves accurate coding, prompt claim submissions and effective follow-up on denied or delayed claims. Investing in robust billing and coding systems can streamline these processes.

Investment in Technology: Investing in advanced surgical technologies can enhance the quality of care and attract more patients.

For example, robotic-assisted spine surgery and advanced imaging systems can improve surgical precision and outcomes. While these technologies require upfront investment, they can lead to higher reimbursement rates and increased patient volume over time.

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S P I N E S U RG E RY

WHAT IS THE ASC INCOME FROM NEUROSURGERY?

It’s good. An ASC doing 10 cases daily in multiple specialties generates about $7,200,000 annually. Adding 15 lumbar fusions a month—only a 5% increase in total case volume—can potentially increase overall revenue by 50%, after figuring in EBITDA value, thereby doubling its value. As in orthopedics, Medicare sets a total cost allotted for specific eligible neurosurgery procedures.

The explanation of benefits (EOB) generally includes what portion of this total cost goes to the physician, what part goes to the facility and the 20% “patient responsibility,” which is their out-ofpocket costs.

EXAMPLE

CPT code 22612 (lumbar arthrodesis, posterior or posterolateral technique, single interspace) incurs an ASC total cost of $17,510.

Medicare pays the facility $15,900, which, when added to the 20% the patient contributes, means an income of $19,402. The profit, thus, is $1,892 per lumbar arthrodesis.

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A Breakdown of CPT Codes and Facility Fees Paid by Medicare (all national averages) 22551

Anterior cervical discectomy and fusion (ACDF)

$8,692

22510

Cervicothoracic injection

$1,478

22513

Percutaneous vertebral augmentation

$52,920

62350

Implantation of intrathecal/epidural catheter

$3,170

63650

Implant neuroelectrodes

$4,261

63030

Laminotomy (hemilaminectomy) with decompression of nerve roots, including partial facetectomy, foraminotomy and/or excision of herniated intervertebral disc

$3,256

63045

Posterior cervical foraminotomy

$53,137

22856

Cervical arthroplasty

$15,387

22554

Transforminal anterior interbody fusion (TLIF)

$9,005

22612

Transforminal posterior interbody fusion (TLIF)

$15,900

22612

Lateral lumbar interbody fusion

$15,900

22856

Total disc arthroplastydiscectomy

$15,900

27279

S-I joint fusion

$14,348

62380

Lumbar endoscopic decompression of spinal cord nerve roots, including laminotomy partial acetectomy, foraminotomy, discectomy and/or excision of herniated intervertebral discsingle interspace

$3,137

63047

Lumbar laminectomy

$53,137

22551

Anterior interbody discectomy

$58,692

63030

Laminotomy foraminotomy decompression

$3,256

29848

Arthroscopy wrist, release of carpal ligament

$1,017

64721

Angioplasty/transposition, median nerve at carpal tunnel

$853

There’s been more to the advancement of neurosurgery than merely making things smaller and using smaller incisions. Today’s spinal surgery is being made simpler, which results in more outpatient feasibility (good for ASC investment), better safety, better outcomes and fewer complications (good for the patient). The physiology of bone trauma, inflammation and healing is complex. The body has always had a love-hate relationship with hardware, even that felt to be inert. Introducing a foreign body is never ideal but, when necessary, should be done judiciously.

FUTURE PROSPECTS

The future of spine surgeries in ASCs is promising, driven by several key trends:

A

CONCLUSION

A combination of cost savings,

Technological Advancements: Ongoing advancements in minimally invasive surgical techniques and anesthesia will continue to expand the range of spine surgeries that can be safely performed in ASCs, increasing the volume and complexity of cases and driving revenue growth.

Policy Support: Policymakers are increasingly recognizing the value of ASCs in reducing healthcare costs and improving access to care.

Continued support for policies that expand insurance coverage and reimbursement for ASC-based procedures will be crucial for the growth of spine surgeries in these settings.

Patient Preferences: Patients are increasingly seeking convenient, cost-effective care options. The shorter recovery times, lower infection rates, and overall efficiency of ASCs make them an attractive choice for spine surgeries, driving demand and financial growth for these centers.

Expansion of Services: ASCs are likely to broaden their offerings beyond traditional surgeries to include comprehensive spine care, such as pain management, physical therapy and postoperative rehabilitation. This integrated approach can enhance patient outcomes and create additional revenue streams.

revenue generation opportunities and reimbursement challenges shape the financial dynamics of spine surgeries in ASCs. By effectively managing costs, securing favorable contracts, and leveraging technological advancements, ASCs can thrive in the evolving healthcare environment. The future of spine surgeries in ASCs appears bright, with significant potential for growth and innovation. As the healthcare industry continues to prioritize value-based care and patient-centered approaches, ASCs are poised to play a crucial role in delivering high-quality, cost-effective spine surgeries. T _____ Tony Rastegar, M.D., is a spine surgeon.

He obtained his medical degree from the Pritzker School of Medicine at the University of Chicago, and did his fellowship in spine surgery at the worldrenowned Cleveland Clinic.

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O RT H O P E D I C S

The Financial Viability of Orthopedic Care in ASCs

BY NATHAN SKELLEY, M.D.

Ambulatory Surgical Centers (ASCs) are innovative outpatient healthcare centers that offer surgical services in a patient-focused and streamlined healthcare delivery model. These settings can offer a comfortable ambience, improved patient/specialist experience, and affordable services for many patients in the United States. The ASC market is growing every year and is projected to grow from $46.62 billion in 2023, to $75.20 billion by 2030.

This incredible growth in ASCs is a recognition of the many benefits they provide for their patients and healthcare teams. For patients, ASCs can include more convenient locations, shorter wait times, easier scheduling and frequently more accessible parking. For orthopedic surgeons, ASCs are often more convenient, more efficient, care teamfocused and customizable to their needs. Many orthopedic procedures are highly technical and specialized.

ASCs allow orthopedic surgeons the opportunity to perform these complex procedures more efficiently than in other general care settings.

Specialties

Elective orthopedic subspecialties are well positioned to benefit from an ASC workflow and care model. For example, technological advances in small, ultra-high definition 4k cameras and smaller curved instrumentation

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have made it possible for sports medicine surgeons to perform more complex and larger surgeries safely through small poke hole incisions in outpatient settings. ASC orthopedic operating rooms can be equipped and designed to focus on areas such as arthroscopic sports medicine, hand surgery, joint arthroplasty, etc. to make these care lines even more efficient.

Many aspects of orthopedic surgery subspecialty service lines are wellsuited to the ASC care design.

Joint arthroplasty is an area of orthopedics that is growing rapidly in ASCs across the country. The cost of implants has been a barrier to entry in this space, but that is changing with improved agreements and payment plans. Companies are developing more efficient trays and instrument sets to accommodate smaller ASC sterilization centers. Initially, ASCs only performed knee and hip replacements. Now, an increasing number of total ankle and

shoulder replacements are also being performed in these centers. There were initial concerns that early reports favored ASC patient outcomes because they were selecting for more healthy patients. This was thought to be a selection bias in the reported datasets. However, increasing evidence is being published that shows, when controlling for patient comorbidities, ASCs are commonly providing the same or better levels of care and patient outcomes compared to hospital care. With the aging population, the expected increase in joint arthroplasty cases will continue to be a growth area for ASCs. Part of the rise of arthroplasty procedures in ASCs is the great value that these procedures provide to patients and healthcare systems. The cost to patients and healthcare systems are often lower for care provided in ASCs when compared to other healthcare settings. In this era of increased price transparency, patients and employers will expect a more transparent cost system. This is especially important in a field such as orthopedics where many employers and patients have a choice about where they would like to receive their elective care. Consumers that have a choice in their care will likely seek the lower cost option, which improves the future financial viability of orthopedic care in ASCs.

Cost Savings

The costs to both Medicare and the patient are lower in ASCs than in hospital outpatient surgery departments. For example, a Medicare beneficiary could save over $200 in co-pays if a meniscal repair is performed in an ASC rather

than a hospital. The savings to Medicare are over $800 for this procedure.

Cost information is increasingly being provided to consumers of healthcare services to facilitate informed decisionmaking. When comparing costs between an ASC and a hospital, a Government Accountability Office study found that the cost of an ASC procedure was 84% of the cost of a hospital procedure.

A challenge to ASCs is that their payer reimbursement tends to be much lower than hospital systems. According to the American Academy of Orthopedic Surgeons Position Statement on ASCs, for the same unit of work, an ASC is paid $44.07 and a hospital outpatient department $74.14. In this situation, the hospital is 75% more expensive for the same service! ASC care is saving Medicare billions of dollars and could save even more as more procedures are included in this delivery model. The Centers for Medicare and Medicaid Services payment policy has historically reimbursed ASCs 58% of the reimbursement for similar procedures performed in a hospital setting. If these systems are providing

ASCs allow orthopedic surgeons the opportunity to perform these complex procedures more efficiently than in other general care settings.

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O RT H O P E D I C S

the same care with appropriate outcomes, the increasing divergence between the cost of procedures and reimbursements is a significant healthcare issue.

Technique

The improved job satisfaction of a physician workforce can have immeasurable benefits and financial savings for a health system.

Surgical techniques are also evolving which can impact ASC utilization.

For example, wide-awake local anesthesia hand surgery has become an increasingly popular choice for patients and surgeons. The same carpal tunnel release procedure undergoes drastically different reimbursement based on the location where the surgery is performed.

Elective procedures, like these wideawake hand procedures, can be ideal for an ASC setting. However, this procedure has become so efficient that they can be moved to clinic settings to save even more costs. In this case, there is no hospital or ASC facility fee.

At first glance, this could be perceived as a negative for ASCs, however, it should make surgeons more available to do more complex cases with better reimbursement using ASC resources.

Leadership

ASC leadership needs to be aware of these constantly evolving reimbursement situations to make sure they can incorporate these developing orthopedic surgical trends into their care system. In this manner, they can better position their ASC to adapt and adjust to different reimbursement challenges. The future viability of orthopedic care in ASCs relies on creative and knowledgeable ASC leadership that accommodates these situations while advocating for improved health policies to facilitate better reimbursement models.

There are also many financial benefits to ASCs that are difficult to

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quantify. ASCs with greater physician leadership have demonstrated improved staffing and improved patient experience. This leads to less team disruptions and recruitment costs. Similarly, improved patient satisfaction can lead to improved referrals and repeat patients at the ASC. Although ASCs have many different ownership models, the ASC tends to be a place of greater physician autonomy, which helps with improved care delivery. Satisfied patients and satisfied teams can lead to less physician burnout. The improved job satisfaction of a physician workforce can have immeasurable benefits and financial savings for a health system.

Advances in medical technologies and orthopedic techniques increase the procedures that can be safely performed in an outpatient ASC setting. When the appropriate patient, procedure, and service can be delivered through an ASC, the value to both patients and the health system can be very positive. Improved health policies addressing reimbursement strategies and price transparency will greatly improve this care delivery.

Orthopedics is a surgical specialty that is well positioned to benefit from an ASC model. More orthopedic procedures are likely to transition to ASC delivery models as this care system continues to expand and develop in the near future. T _____ Dr. Nathan Skelley is an orthopaedic surgeon. He serves as the vice-chair of the orthopedic department at the Sanford Health-University of South Dakota Medical Center. His prior training was completed at Cornell University, Johns Hopkins, Washington University and the Massachusetts General Hospital-Harvard Medical School.

TO PLA PSI C T I C S U RG E RY

P

Plastic Surgery at ASCs

BY CHARLES NATHAN, M.D.

_____ With the increasing use of social media and the “Kardashian Effect,” plastic surgery has become much more mainstream and out of hiding. _____

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Plastic surgeons often do not have the luxury of having their own ORs in their offices. Since many of their procedures require intravenous sedation or general anesthesia, using an accredited ASC provides a safe, cost-effective and patient-friendly opportunity for the surgeon.

A growing number of patients desire Brazilian butt lifts, rhinoplasties, breast augmentations, liposculpting, and facial aging procedures provided in a cost-effective, safe and comfortable environment. Most cosmetic plastic surgeons are solo practitioners or in small groups and rarely have the luxury of a certified, in-office or adjacent surgery center. Many of the procedures require heavy sedation or general anesthetic, which most surgeons do not want to be responsible for.

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P L A S T I C S U RG E RY

SELECTING PROCEDURES THE COST AND MANAGEMENT OF A CERTIFIED OFFICE FACILITY CAN BE OVERWHELMING.

A surgeon may do multiple procedures daily, necessitating a large, dedicated recovery area and staff. Paying for space to store instruments, implants, garments and disposables can be significant for the busy surgeon and requires staff time to maintain. Access to an ASC allows the busy plastic surgeon dedicated OR time at a prescribed rate, anesthesia providers, and the ability to do multiple cases in a day.

Centers provide most instruments needed, often with a dedicated employee maintaining and sterilizing instruments, allowing rapid turnover of 15 to 30 minutes between cases.

Most centers provide surgeons with a cosmetic fee schedule that includes operating and anesthesia charges, and they provide rates from one-hour to six-hour cases in 15-minute increments. Add-on costs may include using center-provided liposuction machines, single-use cannulas and postoperative garments, allowing the facility to have additional profit centers. The center may want to have a dedicated consignment of breast implants from the desired manufacturer, marking up the cost to the patient and eliminating the surgeon’s responsibility for bringing implants for each case.

Case selection should include procedures done by multiple surgeons sharing commonly used instruments and avoiding oneoff purchases of expensive specialty scopes, sutures and exotic retractors. Additionally, cases requiring large amounts of costly sutures may need upcharges to remain profitable to the center.

Centers that provide RNFAs or certified assistants may charge the patient or surgeon an assistant fee, again allowing more cost- and time-effective surgeries per day. Patients may desire anesthesia to provide post-op nerve blocks for pain relief and have no concern about paying extra for it.

Cash-paying plastic surgery patients typically are healthy, nonsmoking patients who want surgery in a safe, clean and efficient environment. Surgeons desire a safe facility with a reasonable cost structure, rapid turnover, and the ability to use costly equipment with the patients covering the cost to the facility. Plastic surgeons usually book their cases well in advance and typically can consistently fill their allotted block of time, allowing the center to have good OR utilization and staffing. T _____ Dr. Charles Nathan is a board certified plastic surgeon in St. Louis. Dr. Nathan completed five years of general surgery at the Ochsner Clinic in New Orleans and plastic surgery at The Lahey Clinic in Boston.

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• Cases such as breast augmentations bring healthy cash-paying patients with minimal equipment and suture use.

• Rhinoplasties, Brazilian butt lifts, breast lifts, and liposuction are also low set cost cases that allow a reasonable profit margin per case.

• Tummy tucks and breast reductions are more suture cost-heavy but can be done in a reasonable time and require little special equipment short of two cautery units if the surgeon uses an assistant.

K N O C K- O U T N E W S

BY G O S I A B O R C H A R DT

Anesthesia and PONV SIDE EFFECTS

The shift of surgical procedures from hospitals to Ambulatory Surgery Centers has improved patient satisfaction, but anesthesia-related complications like postoperative nausea and vomiting (PONV) remain a challenge.

PONV not only reduces satisfaction but also increases costs and delays recovery. The anesthetist faces a real challenge to administer not only safe but efficient anesthetic care to facilitate the timely discharge of the patient.

There are multiple factors that decrease patient satisfaction with their anesthetic. These include postoperative nausea and vomiting (PONV), pain and sore throat, among others. Vomiting remains the top-ranked complication that patients want to avoid.

Nausea ranks fourth, only outranked by gagging on the endotracheal tube (ETT) and pain. PONV not only decreases patient satisfaction but also increases the cost associated with the individual’s perioperative experience.

ADDED EXPENSES

On average, the cost associated with those suffering from PONV increases by $732.27 per patient, compared to those without PONV. It is also associated with a prolonged PACU stay by an additional 61 minutes and, on average, increases nursing care time by 14 minutes. In addition, 1.6% of these patients end up being admitted to the hospital for intractable PONV, further decreasing their satisfaction with the surgical process.

While there are existing drugs on the market to reduce the incidence of PONV, the newest one, Aponvie (aprepitant) in IV form, proves to be superior in the prevention of PONV for up to 48 hours, as compared to the existing preventative and rescue medications.

The billable unit for C9145 is 1 mg. The 32 mg single dose in each Aponvie vial corresponds to 32 billable units. Aponvie is also separately reimbursed by Medicare at ASP +6% in HOPDs and ASCs under three-year transitional passthrough status effective April 1, 2023.

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TOTA L J O I N T A RT H RO P L A S T Y

The Ongoing Migration of Total Joint Arthroplasty to Ambulatory Surgery Centers

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BY ALEJANDRO BADIA, M.D., FACS, FRCSI

In recent years, the healthcare landscape has seen a significant shift toward outpatient procedures on multiple fronts, particularly in the realm of joint replacements. Ambulatory Surgery Centers (ASCs) are emerging as a viable option for patients seeking knee, shoulder and hip replacements, offering several advantages over traditional hospital settings.

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The data surrounding outpatient joint arthroplasty is currently limited to hip (THA) and knee (TKA) replacements. This is very recent data, given that the Center for Medicare Services (CMS) only allowed TKAs to be performed on a hospital outpatient basis in 2018, and then permitted these cases to be done in an independent ASC in 2020. Similar site policy changes occurred for THA about one year later.

Currently, orthopedics is represented in

70% of multispecialty ASCs, but only 5% of

centers are solely orthopedic focused.

The shift has been rapid. In early 2021, 29% of Medicare primary joint replacements were done on a hospital outpatient basis, 64% in hospital outpatient facilities, and 7% in independent ASCs. Note that 100% of these joint replacements were performed as inpatient hospital cases in 2017, just four years earlier. During that same period, the percentage of hospital-based patients being discharged the same day went from only 2% to nearly 20%. The shift in care is being seen across all settings.

Currently, orthopedics is represented in 70% of multispecialty ASCs, but only 5% of centers are solely orthopedic focused. This presents a clear opportunity to expand this sector since the protocols implicit for these surgeries will lend itself to very focused surgery centers. The clear benefits, challenges, and future of joint replacements in ASCs will be reviewed.

Understanding the Value Proposition of ASCs

Ambulatory Surgery Centers have become the preferred option for a variety of minor procedures for many decades. Arthroscopy of all joints is now standard in ASCs, whether independent or hospital-affiliated. Later, endoscopic procedures, including laparoscopy or cystoscopy, became commonplace because of advances in technology and anesthesia protocols. More recently, ASCs have become accepted locations for the often-complex joint arthroplasty surgeries. It is ironic that the most commonly performed arthroplasties are hip and knee, which are weight-bearing joints and require strict nursing and logistical protocols to allow a patient to return home on the same day.

This prevalence is likely explained by the sheer

volume of these surgeries as opposed to other joint replacements, whether shoulder, foot, or hand joints. The acceptance by insurance carriers has driven much of this migration away from the hospital. This symbolizes the ubiquitous challenges faced by the ASC industry since the decision of where to perform a particular surgery should be in the hands of clinicians: whether surgeon, anesthesiologist, or nursing staff.

A clear example is shoulder arthroplasty as CMS only approved this for ASC reimbursement less than a year ago, around the same time that total ankle arthroplasties—a much more complicated procedure due to ambulation challenges and swelling as the ankle is necessarily a very dependent position. Since most patients don’t walk on their hands (sarcasm intentional) it would make sense that a patient can much easier go home in a sling as opposed to on crutches and limited weightbearing as seen in hip, knee or ankle procedures.

Another example is small joint replacement in the hand, including the commonly affected thumb basal joint.

The Medicare population often suffers from this painful malady, but American hand surgeons have not widely adopted implant arthroplasty, and that the prosthesis cost is not covered in ASCs further leads to this impediment to progress. This situation embodies the challenges of the ASC, and even the entire healthcare system, where bureaucrats make policy decisions, not the clinicians who best understand the clinical issue.

It is important to summarize why joint replacements are ideally suited for this preferred surgical environment. >

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TOTA L J O I N T A RT H RO P L A S T Y

THE BENEFITS

OF JOINT REPLACEMENTS IN ASCs COST-EFFECTIVENESS

One of the most significant advantages of performing joint replacements in ASCs is the cost savings. Procedures conducted in ASCs generally incur much lower facility fees compared to hospitals. This reduction in costs can be beneficial for both patients and insurers, leading to lower out-of-pocket expenses and increased accessibility.

This disparity is rather unfortunate since fairer compensation would encourage further migration to the ASC sector and would lessen undue strain on independent surgery centers. One can only surmise that the powerful hospital lobby is largely responsible for this unlevel playing field.

The impact to surgeons is particularly important, hence facility ownership becomes increasingly attractive. As joint replacement facility payments

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decreased 2.4% across all sites, explained by the decreased reimbursement of outpatient versus inpatient arthroplasties, the decrease to surgeon reimbursement was 8.7% from 2018 to 2021. This is partly due to that shift in site location, since the hospital and ASC disparity is decreasing, but illustrates that the person skilled to actually perform the surgery is being adversely affected, particularly if hospital-employed.

FASTER RECOVERY TIMES

Patients undergoing joint replacements in ASCs often experience shorter recovery times. The outpatient model allows for streamlined care, with focused attention on rehabilitation and pain management. With effective preoperative and postoperative protocols, many patients report feeling more comfortable and ready to engage in rehabilitation sooner. One example is the continued reluctance by hospital surgical departments of using long-acting anesthetics (i.e. lysosomal release bupivacaine) in regional blocks.

The rapid adoption of this patient-facing benefit typifies the improved focus on customer service in the ASC environment.

With effective preoperative and postoperative protocols, many patients report feeling more comfortable and ready to engage in rehabilitation sooner.

REDUCED INFECTION RATES

ASCs tend to have lower infection rates than hospitals, largely due to the type of surgeries routinely performed in an ASC as opposed to a hospital. Enhanced sterilization processes and reduced exposure to hospital-acquired infections beyond the surgical suites contribute to a safer surgical environment. Multiple studies have shown that there are few differences in complication rates between inpatient and outpatient arthroplasties, which includes patients with multiple comorbidities.

A recent study of complications following TSA (total shoulder arthroplasty) actually revealed that inpatient surgeries experienced twice as many complications (17.5% versus 9.5%).

PERSONALIZED CARE

The smaller scale of ASCs typically results in a more personalized approach to patient care.

Patients may receive more individualized attention from healthcare professionals, leading to improved satisfaction and better overall outcomes. Families are understandably anxious while sitting in a waiting room and the very nature of an ASC, removed from the stress and sensory overload of a hospital, can provide a calming effect.

TECHNOLOGICAL ADVANCEMENTS

Many ASCs are equipped with cutting-edge technology that facilitates minimally invasive surgical techniques, as surgeons typically have a greater say in equipment procurement. I recall the largest private hospital in Miami delaying the use of mini-fluoroscopy while a small ASC had invested in it long ago. These advancements not only improve surgical outcomes but also enhance the overall experience for surgeons who often have a choice of where to bring their patients when scheduling a procedure.

THE CHALLENGES

OF JOINT REPLACEMENTS IN ASCs Despite the many benefits, there are challenges associated with performing joint replacements in ASCs. PATIENT SELECTION

Not all patients are suitable candidates for outpatient joint replacement. Factors such as age, comorbidities, and the complexity of the procedure play a crucial role in determining eligibility. ASCs must carefully evaluate patients to ensure they can safely undergo surgery with no extended postoperative monitoring or direct access to an ICU. REGULATORY CONSIDERATIONS

ASCs must adhere to strict regulatory standards and accreditation requirements, which can vary by state and country. Maintaining compliance can be resource-intensive and may limit the procedures that can be performed. Unfortunately, the type of joint replacement is often constrained by archaic guidelines and insurance limitations, emphasizing the ongoing need for surgeon engagement and education of non-clinicians.

POSTOPERATIVE SUPPORT

While ASCs provide a streamlined surgical experience, they must also ensure robust postoperative support for patients. This includes effective pain management and rehabilitation programs to help patients transition smoothly from surgery to recovery, since discharge takes a patient away from a clinical environment.

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TOTA L J O I N T A RT H RO P L A S T Y

THE FUTURE

OF JOINT REPLACEMENTS IN ASCs The trend toward performing joint replacements in ASCs is expected to continue as healthcare evolves.

VALUE-BASED CARE

With an increasing emphasis on value-based care, the advantages offered by ASCs align well with the goals of improving patient outcomes while reducing costs, hence satisfying the triple aim.

Healthcare providers are also investing in training and technology to enhance the capabilities of ASCs, ensuring that they can safely accommodate more complex procedures in the future. As patient awareness grows regarding the benefits of outpatient surgery, demand for joint replacements in ASCs is likely to increase.

Ultimately, our American system needs these shifts in order to lower our total healthcare spend as we are approaching $4 trillion, representing 20% of the GDP. According to research by the Ambulatory Surgery Center Association, simply performing total knee replacements and knee mosaicplasty procedures at ASCs is projected to save Medicare $73.4 billion by 2028.

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Joint replacements in Ambulatory Surgery Centers represent a promising evolution in the delivery of surgical care. With their cost-effectiveness, faster recovery times and personalized approach, ASCs are becoming an attractive option for both surgeons and patients who research their options.

As advancements in technology, anesthesia and surgical techniques evolve, the role of ASCs in joint replacements is poised to expand, ultimately improving patient outcomes and satisfaction in the surgical experience. Lastly, with surgical professional fees continuing to decline, it behooves surgeons who perform joint replacements to migrate their cases to an ASC and prioritize making an investment in these facilities to offset this phenomenon. T _____ Alejandro Badia, M.D., is a hand and upper extremity surgeon. He is the founder of OrthoNOW, a network of orthopedic walk-in centers. He is author of the book, Healthcare from the Trenches.

SURGERY BUSINESS PEOPLE YOU SHOULD KNOW

ALEJANDRO BADIA, M.D.

FOUNDER/SURGEON, ORTHONOW

Dr. Alejandro Badia is a hand and upper extremity surgeon, author and healthcare entrepreneur in Doral (Miami), Florida. He studied physiology at Cornell University and obtained a medical degree at NYU, where he also trained in orthopedics.

A hand fellowship at Allegheny General Hospital in Pittsburgh was followed by an AO trauma fellowship in Freiburg, Germany.

TELL US ABOUT YOURSELF AND YOUR JOURNEY TO WHERE YOU ARE.

Having lectured on all seven continents, Badia is currently focused on improving healthcare delivery in the orthopedics and sports medicine realm.

I run an international hand fellowship, served on the review board of a hand surgery techniques journal, and previously organized a yearly Miami meeting for surgeons/therapists devoted to upper limb arthroscopy and arthroplasty. This international meeting was held at the renowned Miami Anatomical Research Center (MARC) which I co-founded in 2005.

In 2008, I created the Badia Hand to Shoulder Center, having previously co-founded the Miami Hand Center, and Surgery Center at Doral.

In 2010, I launched OrthoNOW, the first immediate orthopedic care center in south Florida, later franchising the concept which can now be licensed to orthopedic colleagues and healthcare systems and I’m currently seeking the optimal strategic healthcare partner.

I’m the past president of the International Society for Sport Traumatology of the Hand (ISSPORTH) and a member of several orthopedic societies (AAOS, ASSH, AAHS, EWAS), an honorary member of more than 10 international hand surgery and arthroscopy associations and served as an honored professor at the prestigious Philadelphia Hand Course in 2012.

I outlined my journey and delved into the major challenges and hurdles of delivering healthcare in the United States through my Amazon bestselling book, Healthcare from the Trenches, published during the COVID-19 pandemic, and I discuss similar issues in my biweekly, 20-minute podcast, Fixing Healthcare … from the Trenches.

WHAT DOES YOUR COMPANY DO?

OrthoNOW is the nation’s first network of specialized urgent care centers focused on the treatment and prevention of the full range of

orthopedic issues, whether acute or chronic. The vast majority of these common musculoskeletal issues are initially seen in a general urgent care, or even ER environment, neither of which typically has the expertise to definitively resolve the problem, leading to inefficiencies and high cost at best, or an inaccurate diagnosis which leads to impairment at worst. OrthoNOW aims to enhance the patient journey and ensure that outpatient surgery centers are affiliated and can further help to decrease cost of care issues, while actually improving outcomes and expediency.

TELL US HOW YOUR SERVICE ADDRESSES THE PAIN POINTS OF YOUR CUSTOMERS.

Patients save time and money, and have access to appropriate treatment from the outset. Clinicians are able to refer patients to a walk-in facility where the clinical issue will be resolved, or the affiliated surgeon will take to surgery if needed. It lowers the overall cost of healthcare while improving quality.

MOST PEOPLE WOULD BE SURPRISED TO KNOW THAT MY COMPANY …

… was started 14 years ago and has been run and solely owned by a busy surgeon whose vision is to democratize good, timely musculoskeletal care.

WHAT WOULD YOU SAY ARE THE MOST EXCITING OR TRANSFORMATIONAL THINGS HAPPENING IN YOUR SEGMENT OF THE INDUSTRY RIGHT NOW?

The concept of orthopedic urgent care has rapidly grown, largely fueled by orthopedic groups who want to provide better access, but who also realize that this could be the greatest fuel to ASC growth.

WHAT DO YOU THINK NEEDS TO BE DONE TO REIN IN THE SPIRALING COST OF HEALTHCARE?

Minimize the middlemen and give back control to those who actually deliver healthcare … from the trenches. T

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G Y N E C O LO G Y

The Untapped Gold Mine:

A

Ambulatory Surgery centers (ASCs) offer several advantages over hospital settings, including lower surgery costs, increased efficiency, improved quality assurance and higher profit margins.

Streamlined operations and reduced overhead costs typical of ASCs allow physicians to take a larger share of profits.

As physician reimbursement rates continue to decline, ASCs, by focusing on a smaller list of specialized surgeries and providing better incentives with consistent management goals, can reward providers

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Gynecology in Ambulatory Surgical Centers

BY PARUL YADAV, M.D.

while maintaining the vision of making money for the owners.

For physicians looking into entrepreneurship, leadership and freedom, an ASC provides a profitable avenue to incorporate gynecology surgery into their establishment. Gynecologic surgery is often well suited to the ASC setting, given that the surgery often has low acuity and a rapid turnover. This makes it an economically viable option that can be performed efficiently. It often involves patients with higher income and private insurance, which

Maximizing Profitability of Common Gynecological Procedures in Ambulatory Surgery Centers

According to VMG Health’s “Multi-Specialty ASC Benchmarking Study” for 2022, with $3,117 per case, gynecology ranks second in revenue per case after orthopedics, which on average generates $3,791 per case. tends to have higher reimbursement rates.

The most common gynecological procedures that can be successfully done in an ACS include laparoscopic hysterectomy and myomectomy, laparoscopic tubal ligation, hysteroscopy, endometrial ablation, LEEP, and laparoscopic sacrocolpopexy.

Another aspect to consider is that more and more OB-GYNs are looking to do only gynecology and find practicing in hospitals challenging with all the rules and regulations. ASCs offer a transition where they can bring their patients and have part ownership. Getting them acclimated to the fast pace of turnaround in an ASC is crucial in such cases. Adequate numbers of these procedures and well-trained gynecologists are the key drivers for financial success.

Many gynecological procedures can be performed with equipment already used in a surgical suite, with no additional expenditure or minimal expenditure, which results in a high return on investment.

ASCs are increasingly becoming the preferred setting for various surgical procedures because of their costeffectiveness, efficiency and patient satisfaction. In gynecology, several procedures stand out for their financial profitability when performed in an ASC setting. Explore five common gynecological procedures that can be highly profitable:

1

Laparoscopic Hysterectomy

Laparoscopic hysterectomy is a minimally invasive surgery that involves the removal of the uterus using small abdominal incisions by a laparoscope. It is used to treat conditions such as fibroids, endometriosis and uterine cancer.

It is the second most common gynecological procedure for women, with about 600,000 hysterectomies performed in the United States every year; most are done for women aged 40-50. About 80% of these could be done laparoscopically. According to a report by the Agency for Healthcare Research and Quality (AHRQ), hysterectomy procedures accounted for 2.7% of the 11.9 million major ambulatory surgeries performed in hospital-owned facilities in 2019, making it one of the top 20 ambulatory surgical procedures.

Starting with minimally invasive procedures can be very beneficial. When done efficiently, they can be performed in a short span of time, thereby increasing revenue and promoting efficiency, resulting in profitability. Careful patient screening to identify ideal candidates and efficient use of operating room time and resources can further increase the number of procedures performed.

Additionally, high patient satisfaction will lead to the natural advertising of the center, which will bring in more patients. Better intra- and postoperative pain management and nausea management also ensure early discharge and low readmission rates. The average reimbursement per laparoscopic hysterectomy done in an ASC is $5,400$5,800.

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G Y N E C O LO G Y

2

Hysteroscopy

Hysteroscopy is a minimally invasive procedure used to diagnose and treat uterine issues, including abnormal bleeding, polyps and fibroids. It involves inserting a hysteroscope through the cervix to view the inside of the uterus. Hysteroscopy is highly profitable due to its minimally invasive nature, allowing quick patient turnaround and reduced recovery times. Reimbursement rates for hysteroscopy are favorable, especially when bundled with other diagnostic and therapeutic procedures.

Efficient scheduling and streamlining preoperative and postoperative care can minimize downtime and increase profitability in ASCs. Investing in advanced, high-quality, reusable hysteroscopes reduces long-term costs and enhances operational efficiency. Additionally, ongoing staff training not only enhances the quality of care but also reduces procedure times and improves patient outcomes and satisfaction. The Medicare reimbursement rates for hysteroscopy vary depending on the nature of the procedure and the additional procedures performed and can range from $2,000 to $3,000.

3

Endometrial Ablation

Endometrial ablation is a procedure to destroy the lining of the uterus to treat heavy menstrual bleeding. It can be performed using various methods such as radiofrequency, thermal balloon or cryoablation. It is a quick procedure with high patient satisfaction rates and minimal recovery time, making it a lucrative option for ASCs. Offering different ablation techniques can attract a broader patient base.

More than 500,000 endometrial ablations were performed in the United States in 2016. The global endometrial ablation market size was estimated at $1.13 billion in 2022, and is expected to grow at a compound annual growth rate of 5.16% from 2023 to 2030. This could be attributed to the increasing prevalence of gynecological disorders and rising public awareness of minimally invasive

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procedures. For ambulatory centers, this trend suggests a promising demand for such services, making the incorporation of endometrial ablation into their offerings a potentially lucrative decision.

By capitalizing on this expanding market, centers can attract a larger patient base, increase revenue, and enhance their competitive edge in the healthcare sector. The Medicare reimbursement rates for endometrial ablation vary by the method used and can range from $2,400 to $3,700.

4

Myomectomy

Myomectomy involves the surgical removal of fibroids from the uterus, preserving the uterus for women who may wish to maintain fertility. When performed laparoscopically or hysteroscopically, the shorter hospital stays and quick recovery times make it a profitable procedure.

The increasing trend toward minimally invasive myomectomies and the shift to outpatient settings present significant opportunities for ASCs. Prioritizing laparoscopic and hysteroscopic myomectomies can attract more patients and reduce costs associated with longer recoveries.

Building strong relationships with gynecologists and primary care physicians can increase referral rates for myomectomies. The Medicare reimbursement rates for myomectomy may range from $3,600-$5,500

Loop Electrosurgical Excision

5 Procedure (LEEP)

LEEP is used to remove abnormal or precancerous cells from the cervix. It involves excising the abnormal tissue using a wire loop heated by an electric current. It is a short, 10-minute outpatient procedure with minimal recovery time, making it highly efficient and profitable. Medicare reimbursement rates for LEEP are around $350-$400. T

Ambulatory Surgery Centers provide an ideal setting for many gynecological procedures due to their efficiency and cost effectiveness. Implementing strategies such as standardized protocols can reduce procedure times, minimize gaps and optimize operating room utilization. By investing in advanced technology and enhancing patient care protocols, ASCs can increase the profitability of common gynecological procedures. Moreover, establishing a robust follow-up program can enhance patient satisfaction and encourage referrals.

As the healthcare landscape evolves, ASCs prioritizing efficiency, patient satisfaction, and continuous improvement will be well-positioned to thrive financially.

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SURGERY BUSINESS PEOPLE YOU SHOULD KNOW

DEEPTEE JAIN, M.D.

SPINE SURGEON, CENTER FOR BONE AND JOINT SURGERY Dr. Deeptee Jain is a minimally invasive spine surgeon at the Center for Bone and Joint Surgery. A Wisconsin native, she completed her medical education at Duke University, followed by orthopedic surgery training at the University of California, San Francisco, and a spine surgery fellowship at NYU. Specializing in muscle-sparing procedures, Dr. Jain minimizes pain and recovery time with her approach, while reducing future spine complications. She is passionate about moving spine care to outpatient settings, offering both operative and nonoperative treatments, ensuring personalized care for each patient.

WHAT DOES YOUR COMPANY DO?

At Center for Bone and Joint Surgery of the Palm Beaches, we provide the highest level of evidence-based care across the spectrum of orthopaedic conditions, including nonoperative and operative treatment options.

HOW DOES YOUR SERVICE ADDRESS THE PAIN POINTS OF YOUR CUSTOMERS?

“It is important to tailor the treatment to the specific patient and meet them where they are in their care journey.”

My area of expertise is in minimally invasive spine surgery. Instead of making a midline incision and elevating all the muscles, which is done in the traditional way of doing spine surgery, I perform muscle sparing approaches, which allow for less pain and faster recovery. Importantly, I think that leaving the muscle envelope intact also decreases the risk of having future spine problems down the road.

MOST PEOPLE WOULD BE SURPRISED TO KNOW THAT MY COMPANY …

… specializes in both operative and nonoperative treatment options. I think sometimes orthopaedic surgeons focus only on surgery, and we did go through a lot of training to become experts in it. However, there is so much more to orthopaedic care, from different injections, to in-office procedures, to regenerative options, and it is important to tailor the treatment to the specific patient and meet them where they are in their care journey.

WHAT WOULD YOU SAY ARE THE MOST EXCITING OR TRANSFORMATIONAL THINGS HAPPENING IN YOUR SEGMENT OF THE INDUSTRY RIGHT NOW?

Moving spine care to the outpatient setting continues to be transformational.

We are doing surgery that used to require an inpatient stay now as outpatients, and we are taking procedures that used to be performed in the hospital or ASC and performing them in the office. This results in a much more delightful, consumer-centric experience.

WHAT’S YOUR FAVORITE THING TO DO ON WEEKENDS?

Work out and hang out with my family. T

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I N F E C T I O N C O N T RO L

Infection Control in ASCs AVOID BECOMING A STATISTIC

BY LAUREN MACKIE, DNP, APRN-CNP

There are about 157,500 surgical site infections (SSI) annually in the United States, costing $3.3 billion. Postoperative infections contribute to increased morbidity, extended hospital stays and higher mortality. Half of all SSIs are believed to be preventable.

Ambulatory Surgical Centers (ASCs) have a lower SSI rate than inpatient facilities.

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A

An analysis by the California Ambulatory Surgery Association of 1 million surgeries performed between 2015 and 2016 found that the rate of SSIs in ASCs was six times lower than in hospital settings; even the highrisk specialty infection rate was under 0.7%.

Ambulatory surgery centers must prioritize transparency and accountability in their reporting. This requires rigorous monitoring and strict adherence to infection protocols and procedures. Some ASCs are more effective than others at tracking and preventing SSIs. Here are strategies to help your ASC stay out of the statistics.

INFECTION PREVENTION TEAM

A well-educated and motivated staff is the foundation for success. Having a dedicated infection preventionist in the ASC is essential for ensuring compliance. The Association of periOperative Registered Nurses (AORN) Ambulatory Surgery Division recommends that ASCs follow regulatory requirements through the ASC Academy Infection Prevention Control Online program. This evidence-based program is specifically designed to help ASCs meet regulatory standards.

Equally important is ensuring that ASC staff feel supported

by the administration and take pride in their role in infection prevention.

TRUSTED SOURCES

Additional trusted resources for SSI surveillance include the CDC’s National Healthcare Safety Network (NHSN) and the Outpatient Procedure Component (OPC), which specifically tracks SSIs in ASCs, helping to identify the true infection burden. The National Surgical Quality Improvement Program (NSQIP), CDC guidelines, World Health Organization (2016), Comprehensive Unit-Based Safety Program (CUSP), and the Joint Commission are other valued guidelines.

Robust monitoring and feedback mechanisms are crucial. Key practices such as hand hygiene and proper use of personal protective equipment should be regularly audited. The infection control team should also monitor adherence to preoperative patient practices, including patient preparation, nasal decolonization, thermoregulation, hair removal,

mechanical bowel preparation, and prophylactic antibiotic administration. A feedback system is vital for reinforcing best practices and identifying areas for improvement.

Providing surgeons with regular SSI updates also reduces SSIs. All healthcare staff need to understand that the primary goal of tracking is to prevent future SSIs, not to impose penalties.

TIMING AND OPTIMIZATION

Consider the timing of surgery and other ongoing treatments that could affect postoperative healing. Most outpatient surgeries are elective, allowing for greater control over surgical timing. Factors such as immunosuppressant therapy, cancer treatment, existing infections, and nutritional status should be carefully evaluated.

Even increased anxiety and a lack of a support system can negatively affect a patient’s metabolic response to surgical stress. Scheduling surgeries during these vulnerable periods may elevate the risk of SSI. Optimization discussions should occur well before surgery.

PREVENTING SSIs SHOULD BE A TOP PRIORITY FOR ALL ASCs. Investing in a dedicated infection control team and equipping staff with evidencebased resources tailored to the ASC environment is critical for success.

Assessing the patient’s current health status is fundamental to minimizing the risk of postoperative complications.

With the right focus and investment, your facility can excel in patient care and infection prevention, avoiding the pitfalls of becoming an SSI statistic.

Smoking, for instance, increases the risk of SSI and other adverse outcomes, and cessation is advised at least four to six weeks before surgery and continued in the postoperative period.

Proper glucose management and maintaining a stable A1c level can reduce the risk of delayed wound healing and complications. Patients who understand the importance of taking care of themselves pre- and postoperatively are more likely to have a successful surgical outcome. T

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THE IDIOT’S GUIDE TO ASC OWNERSHIP

BY S H A K E E L A H M E D, M.D.

“Once you have tasted flight, you will forever walk the earth with your eyes turned skyward, for there you have been, and there you will always long to return.” ~Leonardo Da Vinci

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P

Purchasing a stake in an

Every surgeon in the country dreams of a stake in a freestanding facility, yet few have the acumen or wherewithal to get this accomplished.

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Ambulatory Surgery Center (ASC) can be a complex but rewarding venture, offering physicians not only a significant revenue stream but also a way to have more control over patient care. Every surgeon in the country dreams of a stake in a freestanding facility, yet few have the acumen or wherewithal to get this accomplished.

The primary reason for this shortfall is the lack of business training in our schooling. All of us come out of our residencies armed to the teeth with medical knowledge, but with an utter deficiency of business savvy.

This shortfall reflects in a lifetime of financial missteps.

However, as Shakespeare said, “It’s all well that ends well.” The market is ripe for the picking, and doctors are jumping into the ownership models even toward the sunset of their careers.

There is plenty to choose from in the ASC market. With various ownership models available—from physicianonly ownership to joint ventures with hospitals or management companies— each offers unique advantages and challenges.

Owning and Co-Owning

According to the NIH, there are several types of ownership strategies in the ASC business. I will opine on each as we go on.

Solely physican-owned. This is most ASCs. It gives maximum control to the physicians but also comes with the enormous challenges of managing the facility itself and the difficulty of garnering leverage in contractual negotiations with third-party payers.

Such an ASC should contract with a management company for help running the business, while not allowing the management firm any ownership.

Having built and operated close to a dozen ASCs in the last few decades, I can start by saying that the sole ownership model grants physicians maximum control but comes with the burden of managing day-to-day operations and negotiating contracts with insurers. In contrast, joint ventures can reduce administrative pressures but may involve giving up some autonomy.

Physician-ASC management company joint venture. Joint venture, by definition, is ownership sharing. This means that the physicians may no longer have exclusivity in the control of the ASC at the highest levels. That belongs to the majority owner, and that could be a physician, some of the physicians, or the corporate entity partnering with the doctors. Even if the physicians hold majority equity, the ASC can still benefit from the expertise offered by the minority-owner management company. Control, however, is a huge worry since this model of the joint venture favors the corporate entities, and the management company’s administrative talents and decision-making wisdom come with a relinquishment of power.

Physician-hospital joint venture: the Faustian bargain. This was inevitable, as minimally invasive surgical technology has transformed what used to be an overnight stay (or several days) in the hospital into sameday/outpatient surgery. The unwieldy operations of a large facility, combined with losing market share in this niche service, has had success in bringing hospitals into a joint venture approach with physicians. Hospitals are realizing, If you can’t beat ‘em, join ‘em.

The ASC is also a streamlined method for screening (e.g.,

colonoscopy), surgical diagnostics (e.g., laparoscopy), and other shortstay procedures, which in the past have been steady sources of hospital revenue. Hospitals have seen this revenue being lost to standalone, more convenient ASCs. Preventative care is always evolving and adding procedures that apply well to the ASC and not-so-well to hospitals that miss the boat.

The physician-hospital joint venture ASCs make up an ever-increasing cut of the ASC pie— possibly the largest in the future. ASCs are beleaguered with construction costs, management policies and—no small part of it all—contractual posturing with thirdparty payers, so having a hospital on your side eliminates much of the administrative drudgery. Partnering with a hospital cushions the physicians from financial instability and allows better contracts with insurers thanks to hospital clout. This venture also allows for physicians to be majority owners as a final safeguard of their independence. One caveat: As the saying goes, “He who rides a tiger can never get off.” The physician owners, in quite a few instances, end up selling their autonomy to the larger hospital partners.

Physician-hospital-management company three-way joint venture. In this arrangement, each entity brings expertise and capabilities to benefit the whole. However, this is the least likely arrangement in ASCs and this model represents only a small portion of the ASCs. There must be a reason (or many). I submit the reason could involve the checks and balances when no one entity has majority interest.

While checks and balances are a good thing on one level, on another level they prove quite miserable when one of

the three types of owners has a specific ambition not shared by the other two— or more likely, not shared with the other two.

Hospital-owned solely. In this construct, there is no physician ownership. Hospitals—and everything of which they consist—always need the physicians, so there are associations offered to them by which the hospital can have its cake and eat it, too. Translated, this means keeping physicians, their lifeblood, happy. Or keeping them at all! Although there is no true physician ownership, keeping physicians happy means offering substantial physician participation, possibly linked to a co-management contract and pro rata revenue remuneration.

This model defies the conventional wisdom of involving physician ownership as a key ingredient.

However, it demonstrates that creative associations with physicians, even without ownership, can mutually

benefit all involved via physician leadership and their substantial involvement. Nevertheless, can cats and dogs really get along? Cats scratch and dogs bite and no one is scratchproof or bite-proof.

A Question of Balance

While the majority of ASCs are still solely owned by physicians, which gives physicians the benefit of maximum control despite also bringing the challenges of management and contracting, there is something of value to be considered within the hospitalowned model as long as a win-win situation can be offered.

With the changing paradigms of medicine and the field’s robust evolution, more types of ASCs will be invented. Some will work and predominate and others will fail and be discarded. Ultimately, the dollar, fiscal peace between physicians and the other types of owners, and win-win ownership strategies will determine the

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Business is Business The principles of economics, purchasing, and ownership in an ambulatory surgery center are the same principles that apply to all commerce.

There is a golden ratio that has emerged from all the arithmetic: A business owner who is in the market to sell his entity or franchise would typically like to receive around three years’ worth of net income as the purchase price for that business entity.

If you were in the market to buy a Subway restaurant and the Subway restaurant had a net income of $50,000 a year, a reasonable purchase price for that entity (minus any purchase of hard assets) would be $150,000.

Obviously, an ASC is not a Subway restaurant, but the principles of commerce remain the same. Government entities are fully aware of these principles, and in order to avoid the appearance of kickbacks in the ASC business, certain laws have been created that guarantee these principles are followed in their concept.

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outcome of how the ASC pie is cut in our future. This assumes, of course, the primary result continues to be excellent care. Without that, no one wins—neither owners nor patients.

EBITDA

One of these laws defines the purchase price of shares in an ASC, which is based upon the EBITDA. EBITDA stands for Earnings Before Interest, Taxation, Depreciation and Amortization.

Simply speaking, EBITDA means true net income.

The purchase price of a surgery center must be at least three times EBITDA in order to meet the rules of fair trade and avoid any perception of kickbacks. If you’re a novice and getting into the “sport” of investing, buying or selling surgical shares will tempt you to shortcut ahead to what’s most profitable for you and your interests. You may try to haggle over the buying and selling of these shares.

Don’t.

If you are ever sold shares in an ASC at a value that is less than three times EBITDA, federal agencies can perceive that as a kickback, and the

implications can be gray for both the buyer and the seller of these shares.

With “gray implications,” the federal government will skew its light-anddark perception of the shades of gray decidedly toward the black end of the spectrum.

There’s more. If you buy and sell these shares through an agent that is not qualified to sell ASC shares, you’re again in violation of federal laws, so navigate “your people” carefully.

“Other” people are watching. The spectrum of gray is as visualized in the government’s watchful eyes.

Is this bad? Not really. Most laws— the spirit of the law more than the letter of the law—are designed to fulfill the government’s constitutional mandate of “providing for the public welfare.” Since the books written about providing for the public welfare have gotten very thick over the centuries, ownership in an ASC (in fact, the entire ASC journey) is a learning life-event, and there will always be lessons learned the hard way. Being careful can mitigate the injury from when those lessons come to roost.

With the changing paradigms of medicine and the field’s robust evolution, more types of ASCs will be invented.

Orange is the New Scrub Green

Let me give you an example of the minimum purchase price blues. If as a surgeon owner you purchase shares in an ASC whereby the return on your investment is 50-60% of your initial investment sum, federal agencies can perceive that as a kickback.

Remember the Anti-Kickback Statute?

The federal Anti-Kickback Statute (AKS) (42 U.S.C. § 1320a-7b.) is a criminal statute that prohibits the exchange (or offer to exchange), of anything of value, in an effort to induce (or reward) the referral of business reimbursable by federal health care programs.

No business venture pays 50-60% return on investment in a year. In doing so (by definition), the sellers have undersold their shares in order to attract your business, thus violating the Anti-Kickback Statute.

An unscrupulous or overzealous prosecutor, who also happens to be friendly with a competing hospital’s administration, may decide to have a secret meeting with only those people who will testify against you—and exclude those who can explain your

actions or defend you. There is a name for such a secret meeting: Grand Jury.

It is the fertile ground from which indictments are handed down. Is it just business? Is it personal? This strains the business-versus-personal line of reasoning.

The only way to get shares without satisfying EBITDA criteria is by inheriting them from a family owner who dies. (See below.) Still, such a transfer is short-lived, since the operating agreement, rules and/or regulations will specify certain actions when such a triggering event occurs.

EBITDA is a One-Way Street

Here’s the good news: There is no upper limit of an EBITDA multiple for sale or purchase of surgical center shares. While an ASC can’t have share values less than three times EBITDA, there’s no limit above that number that is disallowed.

While the purchase price for a single specialty small ASC share to the qualified surgeon would be three to four times EBITDA, the purchase price goes up exponentially with the

number of people buying in, their value to the market, and the age and the profitability of the center itself. Here are a few examples.

If you are buying shares of a surgery center that has been in business for a few years and has a high EBITDA, your buying share price typically would be between six to eight times EBITDA. For a highly successful surgery center, buying shares of it will invoke a purchase price of 10 to 12 times EBITDA, especially for buyers who are not surgeon operators—that is, have no way of bringing business to the surgery center. Good examples (of non-surgeon operators) are most of the national ASC management companies who purchase shares in an ASC around this level of multiple.

The same principle applies to selling shares. Most operating agreements don’t have a provision that allows you to sell your shares back to the majority share owners at the purchase price or at an asking price of your choosing.

Most ASC operating agreements have a protective mechanism in place that doesn’t force the consortium of the other owners to buy back your shares at your whim or pleasure … or at your price. Be mindful of that.

Surgery center ownerships are stronger bonds than marriage. You at least can consider leaving your spouse if it’s not mutually beneficial for both of you. And while there are psychodynamics involved in a dissolution of a marriage which go far beyond the community property, there are also psychodynamics involved in separating yourself from an ASC by relinquishing your shares.

What are those psychodynamics?

They are the psychodynamics involved when you mess with other people’s money. It’s a complex process that

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ownership—they are in full control of the ASC. Again, do not construe this as legal advice; obtain your own legal counsel when you are navigating this part of the process, because things change so quickly that the laws of today may be dated—or even illegal— tomorrow.

Please note, as I mentioned above, buying into a surgery center is a bond stronger than most other relationships in life. There are very few options for an ASC minority shareholder owner to exit an ASC. Conversely, ASC operating agreements have very strong laws in their favor supporting the expulsion of a noncompliant owner member, laws of which the owner members must be fully aware. The most important and notorious of these laws is the one-third rule.

Simply stated, the one-third rule states that a surgeon has to derive one-third of his income from surgical procedures performed at the surgery center where he is an owner.

Share Aware Typically, surgery centers have two types of shares: Type A shares and Type B shares.

Type A shares have an advantage over Type B shares. Type A shares are typically the controlling partners’ shares and tend to be the shares associated with control and board decisions. Other than that, Type A and Type B shares are similar in nature—even the purchase and selling prices of these shares will be the same.

Of note, unlike with other healthcare entities, the majority owner does not have to own 51% of an ASC to control the ASC board and its financial and regulatory backbone. As long as the controlling partner owns the most Type A shares—a plurality

needs mutual understanding and agreement between seller and purchaser at the outset. Germane to that thorough understanding is validation; surgery center share prices can be determined objectively by involving actuary firms that specialize in evaluating ASCs and thus their share prices. The cost is immense, but this

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This was a safe harbor created back in the ’90s to document that a surgeon is not using the surgery center as an investment, but actually using it as a vehicle for his livelihood. This one-third rule can become quite contentious and has been used repeatedly by ASC majority owners to punitively treat and expel minority shareholders. Most states would uphold this law, and owners must be fully aware of their commitment to its intent when they purchase into a surgery center. The question I am asked sometimes is: What if a surgeon owns shares in ASCs in two different cities, or in examples like New York and New Jersey, two different states? The law is on the surgeon’s side in these cases and the one-third law applies to surgical cases in both states, collectively.

needs to be considered when dealing with buy and sell events.

What about a surgery center that isn’t there? A special case is a surgery center which is under construction or a new build and does not have a historic EBITDA upon which to base the price. In this case, the EBITDA can be calculated by the projected

number of referrals by the owners in the surgery center, then multiplied by a traditional EBITDA of three to four, to come up with an evaluation price.

Another way to do valuation for a surgery center is the cost of the build and a multiplier attached to it.

A way to understand the complexity and expense in this part of the ASC

ASC ownership will tip that balance toward the good in rewarding ways and for the longevity of your career.

process is to consider, for example, the legal cost involved in the build and for the management of an ASC. Our surgical center franchise in the Midwest has legal bills of roughly $250,000 to 300,000 a year. These are legal bills that we incur in navigating compliance issues, buy/sell events, and management of our surgery centers. While this might be a high sum compared to a traditional single ASC, these are expenses you will consider when you are in the business.

These are complex scenarios, and I strongly urge the involvement of healthcare accountants and lawyers when these dealings are made. If not for the complexity, then at least for the legality (see above).

What about when things get ugly?

For physicians, investing in an ASC

with share ownership is usually a very good deal. Yet, some physician owners may begin contributing less to the group effort. For example, a physician who retires—or who dies.

Some physicians move away for professional or business reasons.

Some physicians are just seen as bad owners for one or many reasons.

The reality is that shares are equity, but the equity worth depends on the owner’s worth to the ASC in terms of contributing to the income. ASCs, in their operating agreement, rules and/ or regulations, have safeguards for the prudent transfer of shares from a nonproductive owner to someone who will be productive. These safeguards are called “triggering events.”

One such triggering event is one that jeopardizes everyone: the onethird rule. If a physician is not doing a third of his or her work at the ASC, the harbor for your boat is no longer a safe one. Since safe harbors make physician-owned ASCs legally possible, this decline in participation could be one such triggering event. Other non-regulatory triggering events can be defined within the ownership framework—the aforementioned retirement or death, for example.

Also, residency within a prescribed radius from the ASC can be mandated.

Obviously, moving several states away will mean not booking cases here when the physician lives there.

Thoughtful pre-planning within the terms of the operating agreement, rules and/or regulations will prevent turmoil and establish an orderly way to proceed with the buying and selling of ownership shares. Specific terms can be established—whether to offer the forfeited shares to minority owners or to a waiting list of potential owners

who want in. Also included in this pre-planning is setting up a structure for how the departing owner will be compensated for “seizure” of his or her shares.

Understanding the financial and operational implications of different ownership structures is crucial for any physician considering buying into an ASC. From legal hurdles to federal regulations like the Anti-Kickback Statute, navigating the business of ASC ownership requires careful planning, financial foresight, and often, professional guidance.

While the potential rewards are significant, the path to ownership is laden with complexities that demand both strategic thinking and a deep understanding of the healthcare landscape.

Ownership in an ASC is a responsibility. Buying in means sharing the profits but also the liabilities—the good and the bad. Done right, however, ASC ownership will tip that balance toward the good in rewarding ways and for the longevity of your career.

If you think that you’re savvy enough to do it without help, you’re probably mistaken. If you feel you need help, you’re smarter than the fools who say they don’t. How much help you will need depends on the contributions from other owners and the professional advice you get. Just remember, regarding the advice: You get what you pay for.

I finish with David Lee Roth’s sage words: “Money can’t buy you happiness, but it can buy you a yacht big enough to pull up right alongside it.” Navigating and winning your battles in this phase of acquisition translates into more financial grounding for you for years to come. T

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SURGERY BUSINESS PEOPLE YOU SHOULD KNOW

CHRISTOPHER L. ROBINSON, M.D., PH.D.

PHYSICIAN-SCIENTIST, BRIGHAM AND WOMEN’S HOSPITAL

Dr. Christopher L. Robinson is a physician-scientist at Brigham and Women’s Hospital specializing in chronic pain.

He completed his M.D./Ph.D. at Weill Cornell Medicine, contributing to groundbreaking antiviral drug discoveries.

Dr. Robinson serves as an advisor to AugMend Health and Doc2Doc. Passionate about leveraging advanced technologies, he leads global research teams to develop innovative pain management therapies. He also directs MGH-Harvard-Tufts Pain Grand Rounds and is an editor for multiple pain research journals.

antiviral drug targeting Zika virus during the Zika epidemic. Prior to my M.D./Ph.D., I completed my undergraduate studies at Georgetown University in Washington, D.C. Now, my chronic pain research team, consisting of members across the globe, work together to accomplish science and medicine in a whole different way.

I’m an adviser for AugMend Health, a virtual reality-artificial intelligence company and Doc2Doc, a physician lending company. Also, I’m the co-director at MGH-Harvard-Tuft’s Pain and Headache Grand Rounds, an editor for Current Pain and Headache Reports and Journal of Pain Research, and I’m involved with many of the chronic pain organizations worldwide.

My team’s goal is to prevent and treat pain utilizing the most advanced technologies, novel oral therapeutics and minimally invasive modalities—the future is nigh.

“It is amazing what you can accomplish if you do not care who gets the credit.”—Harry S. Truman TELL US WHAT YOUR COMPANY DOES.

What if I could tell you that I could predict your pain before it happened? Would you believe me?

Well, then, you will just have to wait and see.

HOW DOES YOUR SERVICE ADDRESS THE PAIN POINTS OF YOUR CUSTOMERS?

DESCRIBE THE JOURNEY THAT BROUGHT YOU TO WHERE YOU ARE. Robinson served on a Ph.D. team that discovered a new antiviral drug targeting Zika virus during the Zika epidemic.

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I did my anesthesia residency at Harvard-Beth Israel Deaconess Medical Center, and I completed my M.D, Ph.D. in stem cell biology in the lab of Dr. Shuibing Chen at the Weill Cornell Medicine/ Rockefeller University/Sloan-Kettering TriInstitutional M.D.-Ph.D. Program.

My team leadership experience from running a startup during my Ph.D. allowed me and my Ph.D. team, including the 2020 Nobel Prize winner in medicine, Dr. Charles Rice, to discover a new

42 SURGERY BUSINESS

We aim to treat your pain before it happens, but if it is already present, then we utilize the most sophisticated technologies to target it.

MOST PEOPLE WOULD BE SURPRISED TO KNOW THAT MY COMPANY …

… is full of a bunch of passionate nerds who are revolutionizing the field of pain.

WHAT IS THE MOST EXCITING OR TRANSFORMATIONAL THING HAPPENING IN YOUR SEGMENT OF THE INDUSTRY RIGHT NOW?

Artificial intelligence. T

N E W S F RO MTO SO PU I CT H A M E R I C A

S

outh America is experiencing significant growth in the adoption of ambulatory surgery, driven by the need to reduce costs and improve the efficiency of healthcare systems. While the region still predominantly relies on a healthcare model centered around general hospitals and inpatient care, important movements have gained momentum and contributed to the development of ambulatory surgery.

In Brazil, SOBRACAM (Brazilian Society of Ambulatory Surgery) has played a crucial role in promoting and developing ambulatory surgery.

The organization works extensively in both the public and private sectors, aiming to expand the adoption of this model throughout the country.

Other South American countries are also embracing ambulatory surgery. In Chile, the Ministry of Health launched a program to expand the availability of ambulatory surgery nationwide, seeking to reduce waiting times for surgical procedures. In Peru, APCACE (Peruvian Association of Ambulatory Surgery and Short Stay) has been working with the government to establish operational guidelines for ambulatory surgical

centers and promote the model throughout the country. Similarly, the Argentine Society of Surgery has been working to establish standards and guidelines for the practice of ambulatory surgery.

Despite gaps in large-scale adoption, ambulatory surgery is gaining increasing traction in South America. This is driven by the urgent need to reduce costs and improve the efficiency of healthcare systems. SOBRACAM and other organizations are working to promote and develop ambulatory surgery in the region, and the results are promising.

The shift toward ambulatory surgery represents a significant change in healthcare delivery across South America. The trend is likely to continue as more countries recognize its benefits, including reduced hospital stays, lower costs and improved patient outcomes. However, challenges remain, such as the need for infrastructure development, training of healthcare professionals, and overcoming cultural preferences for traditional hospital-based care. T

BY FABRICIO GALVÃO

PRESIDENT OF THE BRAZILIAN SOCIETY OF AMBULATORY SURGERY

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N E W S F RO M E U RO P E

P

opulation growth, longer life expectancy, and climate change increase the demand for medical services, making a satisfactory primary healthcare system increasingly important in the United States and Europe. As the global healthcare system aims to lower inpatient admissions and medical expenses, outpatient surgery plays a fundamental role in modern patient care.

Advances in medical technology have strongly contributed to a significant rise in outpatient surgeries in Europe during the past few decades. The United Kingdom is at the forefront of this change, and recent studies have found high satisfaction levels with vascular surgeries in outpatient settings.

Analogous tendencies toward broad implementation of outpatient surgery are seen in France, Spain and Italy. Healthcare authorities in France have considered outpatient surgery as a part of the national policy and the new standard of care. Comparably, the outpatient rate in Spain has significantly risen in the past decade. Although patients who underwent outpatient surgery reported high levels of satisfaction, providing information and managing pain at home still limit acceptance of day surgery. Similarly, outpatient healthcare services have been broadly implemented in Italy.

In contrast, the number of outpatient surgeries in Germany is lower than in other leading European countries. Nevertheless, outpatient surgery shows obvious advantages as a cost-effective and efficient approach. Also, the primary care rate in Greece is lower than in other European countries because of various economic factors, and several Greek surveys reported weak to moderate outpatient satisfaction.

Overall, outpatient surgery in Europe shows promising future potential.

European healthcare systems prioritize preoperative and postoperative care to improve patient outcomes and provide a smoother recovery process, representing a comprehensive approach to outpatient surgery. T

BY KONSTANTIN YAKIMCHUK, M.D.

Healthcare authorities in France have considered outpatient surgery as a part of the national policy and the new standard of care.

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B R I T I S H A S S O C I AT I O N O F DAY S U RG E RY

UK Surgery Update

BY DAVID BUNTING

D

Direct provision of healthcare accounts for 7% of the total greenhouse gas emissions in the UK with further CO2 emissions resulting from codependent industries such as transportation and production of medical drugs and supplies. Inpatient treatment accounts for most hospital admissions, so one of the most important things we can do to reduce the impact of surgery on climate change is to keep our surgical patients out of the hospital.

The British Association of Day Surgery (BADS) achieves its objectives through a multifaceted approach. This includes hosting educational events, developing pathways, producing guidelines and setting benchmarking targets. Specifically, we define suggested day case rates for a group of over 270 individual surgical procedures. The organization offers practical support for clinicians, day case units, and trusts by advising on pathway implementation and overcoming barriers to day surgery. The organization also remains at

the forefront of innovation by embracing new technologies and fostering collaborations with national and international partners.

BADS helps trusts broaden the range of complex procedures that can be performed in day surgery. In some centers in the UK, day surgery pathways have been established for prostatectomy, abdominal wall reconstruction surgery, adrenalectomy, thyroidectomy, anterior cervical decompression, colorectal cancer resections with primary anastomosis, and partial nephrectomy.

The UK is increasing its capacity to perform day surgery by investing in infrastructure, which has included the developing and building of a series of surgical elective hub centers. These can be standalone sites or integrated with existing hospitals that focus on delivering high-volume, low-complexity surgery as a day surgery. There are now 108 surgical hubs across the country with a further 26 planned to be operational by the end of 2025.

THE UK CURRENTLY HAS SOME OF THE LONGEST WAITING LISTS FOR ELECTIVE SURGERY THAT WE HAVE EVER HAD.

Effective day surgery pathways are widely recognized as being one of the most important factors in managing this healthcare challenge and bringing waiting lists down to acceptable standards. To help meet this challenge, the UK aims for 85% of all procedures to be performed as a day case by the end of 2025, a target set by NHS England. T

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HAND & UPPER EXTREMETIES

Maximizing Profit in Hand/Upper Extremity Surgeries

BY FRANCIS DYSARZ, M.D.

SURGERY SPECIALISTS OF ST. LOUIS

M

Maximizing profit in hand and upper extremity surgeries requires strategic consideration of key factors such as case selection, efficiency in surgical setup and execution, optimal use of operating facilities and payer mix management, ensuring both surgeons and ambulatory surgery centers achieve optimal financial outcomes from these common procedures.

There are multiple factors to consider for optimizing returns for hand/upper extremity cases.

Nowadays, with the high proportion of physician ownership in outpatient surgical centers, that involves augmenting reimbursement for both the surgeon and the surgery center. In this article, we’ll first discuss general criteria for enhancing revenues. Then we’ll touch on the particulars for some of the most common outpatient hand/upper extremity surgeries.

In an ASC, the six most common hand/upper extremity surgeries done are: open/endoscopic carpal tunnel release, trigger release, digital nerve repair, thumb carpometacarpal joint arthroplasty, flexor tendon repair and ganglion cyst excision.

The most common cases for any surgeon to do will probably depend on their referral pattern and

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the nature of their practice (community versus academic/university setting, etc.).

Surgical cases can be thought of as “brick” cases, “mortar” cases, or money losers. Brick cases are high-paying cases that will help build up a “building,” the profit of a surgical practice or ambulatory surgical facility. Mortar cases may be minimally or neutrally profitable but keep the proverbial building together by covering practice expenses and ensuring that nursing staff work enough hours to keep them happy as full-time employees with benefits. Money losers are to be avoided but can be tolerated if the loss is minimal and the case is included when the facility has other profitable cases scheduled with the same surgeon, thereby keeping the surgeon working at one location.

Steps to Efficiency

The insurance payer mix is the most important criteria in maximizing profit. Depending on the state in which the physician practices, workers’ compensation cases can pay significantly more than commercial insurance or government insurance programs such as Medicare or Medicaid.

HAND & UPPER EXTREMETIES

Commercial insurance generally pays more than government insurance programs, but that gap has been narrowing for some time now.

Efficiency is another criterion that is controllable by the surgeon for maximizing profit. While this involves being quick and efficient during surgery, true efficiency begins well before the surgery.

In most areas of life, success is in the setup, and surgeries are no different. Requesting the necessary and proper equipment for a surgeon to work efficiently and successfully when the surgery is initially booked is essential. Knowledge and familiarity of the surgical anatomy in the area to be worked on is also essential for a rapid and safe dissection. Time spent reviewing surgical anatomy, ideally with a cadaver if available, before an infrequently performed surgery is time well spent and contributes to a more rapid and safe surgery.

Once the patient is seen in the preoperative holding area and it is confirmed that surgery can proceed as scheduled, the surgeon should check in with the scrub tech and circulating nurse in the operating room.

It is incumbent upon the surgeon to make sure that all equipment and surgical supplies necessary for the case to progress expeditiously are present and that the equipment and operating room table are set up properly.

Microsurgical cases, in particular, can be slowed down by the discovery of damaged instruments when viewed under the microscope and the late realization that a hand table without a stabilizing outrigger arm has been attached to the operating room table, thereby creating unnecessary difficulty performing microsurgery.

This ultimately ends up wasting time and money.

Additionally, any case that can be done with the patient on a stretcher from the preoperative holding area and avoid wasting time transferring the patient on and off an operating room table should be done that way.

The location of a surgery is also one of the most important criteria in maximizing profit. A surgery done at an outpatient surgery center where

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the physician has an ownership interest will be more profitable than a surgery done at a facility where the physician has no ownership interest.

Additionally, operating room turnover times between surgeries at outpatient surgery centers tend to be significantly faster than at hospitals, which results in a significant time savings for the surgeon as the number of cases done in a day increases. This also means that additional cases can be done during the workday at the faster facility.

Hand and upper extremity cases performed under local anesthesia or local anesthesia with minimal sedation from Xanax in a surgeon’s office surgical suite are generally more profitable than those done in outpatient surgery centers or hospitals. This is because Medicare reimbursement to the surgeon is more substantial for several CPT codes done in an office setting as opposed to an outpatient surgery center or hospital. An important caveat is that minimal disposable supplies are necessary and office staff can handle breakdown quickly and efficiently. However, increased reimbursement for procedures done in the office needs to be weighed against the loss of revenue to a surgery center that the physician may have an ownership interest in and would otherwise do the case at that facility. Overall, the more equipment physicians invest in for an in-office surgery suite, the more options they will have to do in-office procedures.

Cash or self-pay patients requiring surgery can also be significantly profitable—more so than commercially insured patients in some cases.

Billing costs, administrative costs such as office staff time spent pre-certifying a surgery with an insurance company, and accounts receivable that the physician would normally incur can be minimized with cash or self-pay patients. These patients become more profitable if the procedure can be done in the physician’s office with a bundled procedure and facility fee, eliminating a more expensive outpatient facility fee at a surgery center or hospital for that patient. T _____ Francis Dysarz, M.D., is an orthopedic surgeon in Saint Louis. He graduated from Saint Louis University School of Medicine. His practice specializes in hand surgery.

ENHANCEMENT FACTORS

Moving into hand/upper extremity surgery in particular, there are multiple factors that can maximize surgeon and outpatient surgical center profitability.

Significant factors are:

1 Quick surgeries— less than 30 to 45 minutes, time into OR, time out of OR / “door-to-door”

2 An efficient and accurate surgeon

3 Minimal non-reimbursable implant costs

4 The ability to provide the surgeon with two operating rooms to use simultaneously—the first room and a “bounce room” to move back and forth between surgeries, allowing multiple surgeries to overlap

5 A surgical first assistant capable of closing surgical wounds accurately and rapidly to allow the surgeon to make optimal use of the bounce room or other tasks that will facilitate the surgical workflow

6 Patients being insured by payers with high facility fees

7 Payer contracts maximizing reimbursement for implants

8 Billing a facility fee for preoperative upper extremity blocks done by an anesthesiologist and billing for the use of an ultrasound machine for those blocks

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HAND & UPPER EXTREMETIES

COMMON OUTPATIENT SURGERIES

Here are a few examples of common hand/upper extremity surgeries done in the outpatient setting, with a quick overview of their financials.

1 OPEN/ENDOSCOPIC CARPAL TUNNEL RELEASE Open carpal tunnel release surgery typically has a 10 minute or less tourniquet time and pays slightly more than endoscopic carpal tunnel release surgery, which typically has a 15 minute or less tourniquet time. Therefore, open carpal tunnel release surgery would be expected to be slightly more profitable overall from a surgeon reimbursement basis alone. However, the outpatient surgery center facility fee billed for endoscopic carpal tunnel release is generally twice that of an open carpal tunnel release, and this can make the procedure more profitable overall.

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2 TRIGGER RELEASE Generally, this is a simple surgery with a seven to eight minute tourniquet time.

Having an assistant close the wound is about the only way to save the surgeon’s time to be used in other, more profitable ways.

3 DIGITAL NERVE REPAIR

This surgery should be done as soon as possible after the injury, ideally less than seven days.

This will minimize scar tissue, enabling the surgery to be as fast as possible and also obtain the best postoperative clinical result.

An operating microscope with auxiliary viewing optics for an assistant and a micro surgically trained assistant will help the case progress efficiently. Also, an NHS 14 micro needle holder/scissors from Accurate Surgical and Scientific Instruments (Westbury, New York) will save time. A connector-assisted digital nerve repair, CPT 64910, requires minimal additional surgical time and reimburses better than a standard digital nerve repair, CPT 64831.

4 THUMB CARPOMETACARPAL JOINT (CMCJ) ARTHROPLASTY This is not a particularly well-paying case for the 60 to 90 minutes it typically requires. Spending five minutes injecting a patient’s painful, arthritic thumb CMCJ with cortisone under fluoroscopic guidance in the office is a common conservative management of this problem and reimburses much better from a time standpoint. From a surgical standpoint, a variety of implant systems have been developed, some of which can save time over the timehonored ligament reconstruction and tendon interposition (LRTI) surgery.

The greatest variable in terms of time required for this surgery is removal of the trapezium in my experience. The Arthrex (Naples, Florida) corkscrew trapeziectomy tool is a huge time and aggravation saver. It allows control and manipulation in order to remove the trapezium intact by incising the multiple capsular ligaments with a No. 15 scalpel and an angled Beaver blade for speed.

5 FLEXOR TENDON REPAIR

Avoiding having to re-thread lacerated flexor tendons underneath the A2 or A4 pulleys or transverse carpal ligament whenever possible can save time. Dissection proximal to the aforementioned anatomic structures and gentle advancement with smooth Adsons forceps can help. In the event the flexor tendons have retracted completely, proximal to the aforementioned structures, suturing the proximal cut tendon into the flared end of an 8 or 10 French red rubber catheter (with most of the flared end cut off) will speed things.

Slightly vertically venting the proximal edge of the A2 or A4 pulleys will help as well. Arthrex 4–0 Fiberloop suture times two knotted together to make a double-armed suture will allow a four-strand repair to be created rapidly across a cut tendon.

Bone anchors from a variety of manufacturers allow rapid and secure anchoring of a lacerated or avulsed flexor digitorum profundus tendon into the distal phalangeal base.

6 GANGLION CYST EXCISION

This generally requires seven to 30 minutes of tourniquet time, depending upon the location of the cyst.

Use of the scrub tech and surgical assistant together for helping with exposure and Senn or Ragnell retractors can save time.

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R E TA I L S PAC E

Top 5 Factors To Consider When Selecting An Existing Property To Renovate For An ASC

O

BY ROB FORNEY , DIRECTOR OF HEALTHCARE/GOVERNMENT, OCULUS INC.

_____ The trend in Ambulatory Surgery Centers shows sustained growth and increased higher acuity procedures. According to the VMG Health 2024 Healthcare M & A Report, there is “a sustained increase of a compound annual growth rate of 1.3% … with approximately 68% of freestanding ASCs being independently owned and operated.”

_____

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Oculus Inc. is often asked by doctors to evaluate an existing property to convert into an ASC, as private practices are looking to increase revenue and improve control over their day-to-day workflow by owning their own facility. While renovations of existing office space or vacant retail spaces are a cost-effective alternative to groundup new construction, there are concerns about this direction. Here are our top five factors we consider when asked to vet a potential property for conversion to an ASC.

Get clear on the program.

Our designers meet with the practice leadership early to understand the project’s goals and the building’s key features. The number of operating rooms and/or procedure rooms needs to be set since that drives the size of the support spaces and will help determine the minimum square footage. Other considerations include diagnostic equipment and the practice’s desire to grow in the future. Co-locating

office space for the practice often makes sense, as there are opportunities to offer related services such as a med spa, physical therapy or mental health treatment space. Our team can determine a footprint from this meeting and calculate the related parking requirements.

What are the city ordinance requirements?

We recommend a meeting with the planning and zoning department for the location to flush out any restrictions on potential development because of the change in use of the property. The staff is usually cooperative and can quickly inform the team of potential impacts to the site plan. Bringing an existing property up to current standards could be onerous, and it is best to know the implications early. Some neighbors may not embrace this use, or there could be a history of issues with the neighboring properties.

The generator location is one critical item that should be respectful to the surroundings and not too far from the building to keep the feeder length and related costs to a minimum.

Perform a building condition assessment.

Oculus Inc. has assessed millions of square feet of healthcare buildings for clients. With a conversion of property into a healthcare use, we focus our attention on both the current condition and the implications of the alterations. This includes: • What is the level of protection for the structural elements (walls, columns, beams, and roof)? The healthcare occupancy life safety requirements may call for increasing the fire protection of these elements.

• Does the building have a sprinkler system?

Sprinklers make code compliance for ASCs less costly.

• What is the floor-to-structure vertical clearance? The depth of the ceiling plenum is critical for OR equipment and mechanical requirements. The mechanical and electrical infrastructure for ASCs is not likely to be accommodated with typical commercial building systems. An engineer with healthcare experience should evaluate it.

• Does the footprint and column spacing

accommodate the flow of an ASC? Spaces with poor length-to-width proportions or small column grid spacing decrease efficiency and will require more gross square footage.

Can the state regulations be incorporated?

We strive to maintain a good relationship with state authorities and often interact with these contacts at the concept level of a project to review requirements that they see could impact the potential project.

One example of a state regulation we look for at an existing retail or office building involves exterior door widths. Some states require 42” wide exit doors at ASCs. Most commercial doors are 36” wide. To widen an existing door surrounded by masonry construction can be expensive.

Will the existing building aesthetic convey that modern healthcare services are provided?

The first impression a patient has of your practice happens as they access the building. This is a great opportunity to reinforce, through the exterior design, the fact that patients will receive first-class, modern healthcare services there. Our designers strive to make key alterations to address creating a proper image for the renovation. On the interior, this type of conversion typically requires a holistic replacement of finishes, although the existing windows need to be considered as the interior functional spaces are located. Our goal with an ASC interior design is to create a calming, healing environment that can hold up to the intense clinical use of the space.

The shift of care from inpatient to outpatient settings has been happening for years and is expected to continue.

A 2024 study by Jone Lang Lasalle projects an 8% growth rate in ASCs over five years and a 16% growth rate over 10 years.

The changing needs of retail and office space markets will offer opportunities for private practices to find a great location that delivers quality care, more flexibility and increased profitability. T

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E N D O S C O P I C S P I N E S U RG E RY

Endoscopic Spine Surgery: Least Invasive, Highest Cost

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BY RUSSELL FEIT, M.D.

Endoscopic spine surgery is an innovative technique to treat spinal pathologies ranging from herniated discs to spinal stenosis and facet-mediated pain. Although the technology has been around for many years and has been used overseas as a firstline treatment for patients undergoing surgical management of painful lumbar spine pathologies, it is just now taking off in the United States.

In 2017, the Centers for Medicare and Medicaid Services approved CPT code 62380, which is an allinclusive code for “endoscopic decompression of spinal cord, nerve root(s), including laminotomy, partial facetectomy, foraminotomy, discectomy and/or excision of herniated intervertebral disc, one interspace, lumbar.” As an interventional pain physician, this procedure has been a major shift in

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my practice and care for patients. It has allowed me to keep more patients in my practice while offering more minimally invasive treatment options and helping patients avoid major, more invasive back surgeries, which have a higher morbidity and cost to the healthcare system.

When I started my journey into endoscopic spine surgery, I came across many roadblocks.

The equipment is expensive and requires a steep learning curve, and the reimbursement is poor.

Depending on the technique and instruments used, costs can vary greatly. Most of the ambulatory surgery centers where I operate own their own endoscopic tower, but none own any of the endoscopic spine equipment, which must be rented or purchased from various endoscopic spine

“

Depending on the technique and instruments used, costs can vary greatly.”

companies. If a center is performing more than five to seven cases per month, it makes financial sense to purchase the equipment. Costs of trays range from $20,000 to $50,000, depending on the equipment requested. There is an additional cost of disposable equipment, which can range from $400 to $600 per case. In my experience, centers do not want to buy the equipment, regardless of how many cases they are performing, so renting is currently the preferred arrangement.

The most basic of endoscopic spine surgeries is an endoscopic rhizotomy. Tray rental costs the center between $400 and $1,000, not including disposables. The CPT code for this procedure is also different from the code noted above, 64772, which can be billed as two units to Medicare.

(Some private payors will pay for three units.)

CPT code 64772 reimbursement to the ambulatory surgical center is $1,451 per unit. As you can see, the margins are thin, but the results of this procedure are significant. Compared with the standard needle radiofrequency, the results typically are the same if not better, and the duration of efficacy ranges between three to five years, versus six months to one and a half years with the needle approach.

Patients suffering from lumbar herniated discs with radiculopathy frequently undergo discectomy after failing conservative measures. Endoscopic lumbar discectomy is a fantastic treatment modality that can be performed on patients both awake and under general anesthesia. The benefits of this procedure are numerous, including its

muscle-sparing capability, minimal disruption to the bony structures of the spine, and lower risk of postoperative infection. Medicare reimburses the ambulatory surgery center $3,392 for CPT code 62380. The cost of the tray rental is $600 to $2,000 depending on disposables, local contracts, and whether you need a high-speed drill. The highspeed drill is frequently used in lumbar stenosis cases when performing a unilateral laminotomy for bilateral decompression (ULBD). The beauty of this procedure is that it avoids destabilizing the spine, which can occur with open cases and may then require arthrodesis, increasing healthcare costs and patient morbidity.

In conclusion, endoscopic spine surgery is a rapidly expanding treatment modality in the United States that is currently hindered by poor reimbursement and high equipment costs. While it is still profitable for the center, most centers would likely shut their doors if these procedures were the only cases performed. As more physicians start to utilize this technology, I hope CMS will consider increasing reimbursement to make it more profitable for the centers and make it available to more patients looking for the least invasive options to help their pain. T _____ Dr. Russell Feit is board-certified pain and emergency medicine physician in South Florida. He specializes in minimally invasive spine interventions, complex opioid management, instructs in endoscopic spine surgery, and consults for pharmaceutical and device companies.

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REVENUE

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Diversification Beyond Surgical Procedures REVENUE STREAMS IN AMBULATORY SURGERY CENTERS

BY RANDI SHERMAN, R.N.

According to industry statistics, there are over 6,000 Medicare-approved Ambulatory Surgery Centers (ASCs) in the United States. While outpatient surgeries make up most of an ASC’s daily work and income, it’s key for the centers to expand beyond the surgery itself. Relying only on insurance reimbursements for procedures is insufficient in the current landscape of dwindling insurance reimbursements and rising costs.

KEY SOURCES OF REVENUE IN ASCs

Outpatient surgeries serve as the primary activity and income generator for ASCs. According to research, ASCs are estimated to earn up to $93 billion in yearly revenue by the end of 2024. Top ambulatory surgeries conducted annually, in order of volume, include: • Cataract Surgery: Over 4 million procedures • Colonoscopy: 3.1 million procedures • Arthroscopy: 1 million knee & shoulder scoping procedures

• Upper GI Endoscopy: 1 million procedures • Lesion removal: 20,000 minor skin cancer/lesion procedures However, ASCs generally receive much lower payments from public and private payers than hospital outpatient departments.

Average insurance reimbursements are also declining. These factors necessitate revenue diversification beyond just ambulatory surgery.

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REVENUE

ANCILLARY MEDICAL SERVICES

LABORATORY TESTING

With the specialized ancillary services needed for surgeries on-site, ASCs can attract more patients, which helps to increase revenue and improve patient care.

ASCs can choose to outsource lab services or invest in bringing labs in-house to support surgical needs and preoperative workups. According to VMG Health’s surveys, more than 65% of ASCs have implemented on-site labs. Conducting diagnostic tests internally allows better case coordination and profits compared to sending specimens to external labs or hospitals.

Common lab tests based on specific specialties include blood count, blood chemistry, urine analysis, respiratory pathogen panels, body fluid cultures, biopsies, cytology and pathology.

DIAGNOSTIC IMAGING

ASCs can install imaging modalities like ultrasound machines, X-ray units and CT scanners within their facilities. This gives patients access to essential preoperative and postoperative diagnostics at the same center. Having imaging capabilities also lowers an ASC’s dependence on external diagnostic facilities.

Many ASCs offer advanced imaging services.

Common options include DEXA bone density scans, mammography, ultrasound, echocardiography, stress testing, CT and MRI.

Rather than solely depending on surgeries, diversifying into ancillary services, strategic partnerships, cutting-edge IT, and robust financial management enable ASCs to deliver better patient care while stabilizing income streams.

Installing imaging units requires considerable initial CAPEX spending but enhances revenues in the long term. Care should be taken to dissociate the operational hours of these imaging facilities from the actual ASC business hours in order to stay compliant with state and federal laws.

PHYSICAL THERAPY AND REHABILITATION

Offering rehabilitation is an impactful ancillary service for ASC joint and spine surgical patients.

Instead of referring patients elsewhere postdischarge, built-in physical therapy allows providing integrated surgical and rehab services.

Physical therapy also attracts additional nonsurgical orthopedic patients to ASCs. According to industry data, many ASCs have added physical therapy units. Typical services include therapeutic exercise training, ultrasound, electrical stimulation, manual therapy, yoga classes and more. Many centers even hire specialized physiatrists to lead rehab programs.

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PAIN MANAGEMENT TREATMENTS

Surgical and nonsurgical pain management spans a vast array of potential services ASCs can provide to enhance revenue streams beyond just conducting major ambulatory surgeries. Treatments include: • Steroid joint injections • Radiofrequency nerve ablation • Stellate ganglion blocks • Epidural steroid injections • Spinal cord stimulation implants • Intravenous pain infusion therapy Offering these can allow ASCs to serve chronic back pain, arthritis and other pain patients while generating additional income.

HOSPITAL AFFILIATIONS

Developing affiliations with major hospitals through transfer agreements and co-management contracts can mutually benefit both parties.

Hospitals gain expanded outpatient services while ASCs obtain more patient volumes through referrals.

California-based, internationally renowned City of Hope cancer hospital’s collaboration with Surgical Care Affiliates to develop a multispecialty ASC that serves radiation oncology, urology, and surgical patients is one example of the model’s success.

JOINT VENTURES WITH SPECIALTY PHYSICIANS

Entering mutually aligned profit-sharing agreements with specialty physicians enables ASCs to secure crucial referrals while physicians obtain part ownership. This offers physicians

major motivation to refer additional surgeries.

Orthopedic surgery, GI, ophthalmology, and pain management are common specialties for such agreements.

Texas-based Nueterra Healthcare’s joint venture relationships with over 100 physician partners illustrate the range of mutually beneficial collaborations possible between ASC management groups and doctors.

management systems, enables streamlining backoffice tasks, coordination between doctors, and supply chain processes. This leads to improved productivity and patient outcomes.

Business intelligence analytics provides datadriven insights into case volume trends, optimal payer contracting terms, and areas needing performance improvement, which all help with management decisions.

RELATIONSHIPS WITH SPECIALTY CLINICS

REVENUE CYCLE MANAGEMENT

Forging partnerships with specialty clinics allows ASCs to expand services offered by utilizing shared expertise, resources and equipment. Such collaborations also provide additional referral channels.

Opportunities exist across a diverse range of specialties, such as orthopedics, cardiology, OBGYN, podiatry, pain clinics, weight-loss clinics, dental surgery centers and more. Multiple specialty collaborations further drive diversified revenue.

By partnering with specialized medical billing firms, ASCs can ensure expert revenue cycle management using the latest tools and analytics.

Focus areas to enhance collections and accelerate revenue include: • Front-end patient eligibility and authorization automation • Customized charge capture workflows • Denials prevention and fast resolution • Improved claim submission processes • Patient payment estimation and collection

TELEHEALTH SERVICES

Incorporating virtual care capabilities like televisits for preoperative assessments and postoperative follow-ups offers tremendous convenience for patients while unlocking new income streams and lowering costs for ASCs. According to McKinsey, telehealth usage has surged 38 times since the pandemic’s onset.

Offering telehealth consultations allows ASCs to attract more patients by eliminating geographical barriers. Virtual post-op visits are also more efficient than in-clinic follow-ups.

COST CONTROL MEASURES

Tight control over costs and resource usage is equally vital for maintaining profit margins.

Measures like staff scheduling optimization using demand analysis help reduce expenses. Lean management techniques also eliminate non-valueadding waste in ASC processes. T

HEALTH INFORMATION TECHNOLOGY

Using robust IT infrastructure and software, such as electronic health records (EHRs) and surgical

Though diversification has some challenges, the investments made today in terms of money, technology and effort can yield multifold returns over time as ASCs continue adapting to the evolving healthcare needs of local communities.

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SUPPLIES

I

ASC Supply Chain Best Practices

BY SCOTT JACKSON

In an era where device-intensive procedures are becoming more common and inflation continues to challenge healthcare costs, controlling supply expenses is critical for the success of Ambulatory Surgery Centers (ASCs). The success and failure of an ASC depends on its ledgers. Supplies, including medical devices, pharmaceuticals and equipment, can account for nearly 28% of an ASC’s revenue, making them a significant budgetary concern.

With device-intensive procedures on the rise and inflationary headwinds, it is increasingly important for ASCs to rein in their expenses, especially their supply expenses, which make up much of their budget. Having stated this, let’s start with a few data points.

It is estimated that the ASC industry spends over $12.6 billion annually on supplies, including medical/surgical products, devices, implants, biologics, pharmaceuticals and equipment.

On average, an ASC spends 28% of its revenues on supplies.

An average-sized ASC’s revenues are $11.1 million, Simple math shows that an average size ASC could spend $3 million per year on supplies.

ASC leaders clearly understand the importance of managing their supply expenses. What’s not as clear, however, is how to manage these expenses effectively.

To help this cause, the following are some best practices to consider as you manage your ASC’s bottom line.

Managing your supply chain begins with people. Most ASCs have a dedicated

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materials manager. This individual must embrace this responsibility and be metrics-driven. They should also receive ongoing materials management training.

Various sources offer this training, such as state ASC Associations, ASCAssociation.org and ASCM.org, and by ASC Software vendors, such as HST Pathways and SIS Source Medical.

Your clinical staff is trained to be clinicians, and your administrator receives training on how to be an effective administrator. This should be no different with your materials manager. You need to invest in this person.

Profit-sharing with your ASC employees is also an effective method of reducing supply expenses. If your employees understand the impact that supplies have on your bottom line, they will be more in a savings mindset.

Turning to technology, most ASCs are using an operating system from companies such as SIS/Source Medical, HST Pathways and other ASC software platforms. These operating systems have built-in materials management modules.

Make sure that you are using those modules to their fullest potential. Many ASCs do not realize the full functionality of these materials management modules.

Some great add-on material management platforms, such as Trivalence.com and Envi.com, bring a much higher level of “procure to pay” sophistication to your center. These types of systems are worth looking into, especially for larger volume ASCs, where there is a quicker return on investment.

ON AVERAGE, AN ASC SPENDS

28%

OF ITS REVENUES

ON SUPPLIES.

Another important area is managing your vendor agreements. Device and implant vendors offer volume commitment rebates & discounts. In many instances, ASCs are not effectively managing these agreements because of staff turnover and lack of tracking systems, thus leaving money on the table.

Companies like TYDEi Health (Tydei.io) can help ASCs manage vendor contracts more effectively by utilizing TYDEi’s technology. This is particularly relevant if you have a large device and implant spend in areas such as orthopedics, cardiovascular and ophthalmology.

Are you conducting quarterly business reviews with your key suppliers? You should be!

Regular vendor reviews allow you to dig deeper into your spending with these companies and allow you to set cost reduction goals together. Are you meeting with your GPO partner regularly? Your GPO partner should be sharing data with you, such as contract versus noncontract spend. Your GPO is incentivized by greater contract compliance, so it is in both of your interests to take advantage of those GPO vendor agreements. ASC non-contract purchases typically range around 60% of total purchases. Noncontract purchases can and will cost you money. Your GPO partner can identify where those non-contract purchases are coming from.

While on the vendor topic, let’s talk about secondary vendors. Remember

getting supplies during COVID? We all learned many supply chain lessons. We need official backup suppliers and not just for the obvious reason of being able to secure product in emergency situations.

The other main reason you want an official secondary supplier agreement in place is that it will save you money when you purchase supplies from an official secondary supplier. When you don’t have an official markup/discount agreement with a secondary supplier, you could be paying too much. You need official secondary agreements with agreed-upon markup/pricing structures.

If your ASC is heavy into orthopedics, ENT, GYN, laparoscopic and/or cardiovascular procedures, your center should be engaged in a device reprocessing program or considered a part of one. An effective device reprocessing program with an FDA-approved reprocessing partner can easily save you $20,000 per year, per operating room. And there are closed-loop reprocessing platforms, such as Provision (Provisiondrs.com) where you receive your own center’s devices back, at 50% off the price of a new device. You are helping to save the environment as your center saves money. For those of you who are skeptical of reprocessing, studies and data support the industry’s validity.

We need our nation’s ASCs to thrive.

You all play an important role in delivering exceptional patient care in an environment that saves our Medicare system billions of dollars every year! But in order to thrive, you will need to remain vigilant in managing your center’s supply expenses. T

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C A R D I O LO G Y

The Heart of the Matter STARTING A CARDIAC ASC

BY ALEX ALCON, R.N. > HIGH-ACUITY CASES AREN’T EXCLUSIVE TO THE “BIG HOUSE” ANYMORE. Today, ambulatory surgery centers are performing more complex procedures than ever, and minimally invasive heart procedures are just the latest additions to Medicare’s covered procedure list (CPL). Cardiology ASCs are appearing all over the United States, increasing to 118 centers in 2023, up from only 13 in 2016. New cardiac surgery centers that serve rural communities are the perfect bridge for a long-standing care gap. These services could benefit over 60 million patients with limited access to care. However, starting a cardiac ASC is no small feat, and success depends on several factors, including state regulations, projected case volumes, and partnership needs.

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C A R D I O LO G Y

Navigating Regulations

Before you start a cardiac service, it’s crucial to understand your state’s laws for surgery center cases. Cardiology is relatively new to the ASC environment, and some reimbursable procedures may still need state approval. Check if your area has a certificate of need (CON) requirement; just because Medicare covers a procedure does not mean your state law does.

Currently, 23 states have CON regulations for ambulatory surgery, and 13 prohibit ASCs from performing cardiac cases altogether. These regulations can change over time, but ensure all procedures at your ASC comply with existing state laws.

Conducting Market Analysis

Once regulatory hurdles are cleared, perform a thorough market analysis, including projected case volumes. To justify the cost of a cardiac lab, centers

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must perform a certain number of procedures per year. To help offset costs, consider adding peripheral vascular (PV) cases to your surgery center. Sharing hybrid labs and staff between cardiac and PV cases can improve room utilization and optimize block time. Expanding your patient population with PV procedures can also boost volume. Accurate projections can be challenging because of ongoing research about appropriate candidates for percutaneous coronary intervention (PCI).

Trends in PCI Procedures

The number of PCI procedures has significantly increased in recent years.

The reasons for this are not entirely clear. One growth factor could be the 2012 approval of TAVRs (transcatheter aortic valve replacement), which shows a positive temporal correlation with PCI cases. Regardless of the reasons, the increase in new cases may slow down

Future Outlook > Some benefits, such as soon. Although generally considered appropriate for the ASC, Medicare’s expanding CPL for outpatient cardiology interventions has prompted additional concerns about patient safety.

The American College of Cardiology (ACC) and the American Heart Association (AHA) developed AUCs, or appropriate use criteria, to address these concerns. AUCs are a classification system separating potential candidates for PCI as appropriate, maybe appropriate, and rarely appropriate. With more than 600,000 cases performed annually in the United States, these AUC guidelines show that only 3.3% of PCI procedures are rarely appropriate.

Impact of ISCHEMIA Trial

The ISCHEMIA (International Study of Comparative Health Effectiveness with Medical and Invasive Approaches) trial was a randomized clinical study that followed 5,179 patients after adding PCI to optimal medical therapy (OMT). Study participants had stable ischemic heart disease (SHID), both with and without angina.

The study found that adding PCI to OMT reduced symptoms of angina and improved quality of life, but asymptomatic SIHD patients showed no improvement.

Both groups had similar outcomes for cardiac events and related deaths at oneyear and four-years post-intervention. In other words, this study indicates that not all patients with heart disease need PCI, and risks often outweigh the benefits in the absence of angina.

The ISCHEMIA trial concluded in 2018 and has prompted ongoing data collection to refine appropriate use criteria for PCI. Researchers applied modified AUCs to reflect ISCHEMIA data and found that 22.3% of procedures are rarely appropriate, starkly contrasting to the current 3.3%. The AHA acknowledges that updating AUC guidelines will likely reduce costs and unnecessary risks.

Implications for Cardiac ASCs

What does this mean for the cardiac ASC? Stricter AUCs will reduce cardiology case numbers. In this case, more is not always better. In 2023, The National Cardiovascular Data Registry added CV-ASC tracking to its database, which monitors the quality of ASC cardiac care to improve outcomes.

Data indicates that selecting from a smaller but optimized selection of PCI candidates will result in better outcomes and could raise reimbursement rates. Not only that, but high-quality patient selection also reduces potential complications and legal risks.

Establishing Partnerships

Establish the necessary partnerships if projected volumes make a business case for launching a cardiac service.

Cardiologists depend heavily on hospital referrals, unlike independently owned practices that allow patients to refer themselves. Cardiologists also must have access to the hospital for high-risk or emergent cases.

Currently, over 70% of cardiology clinics partner with hospitals, and there may be restrictions on the settings where contract-bound physicians can work.

Fortunately, your ASC has an edge in negotiating hospital contracts. T

shorter wait times and increased patient access, are readily apparent. But, the future benefits of an ASC partnership are your strongest selling point.

The current US fee-forservice model lost its luster long ago. The country is moving toward a valuebased healthcare model; CMS plans to include all Medicare beneficiaries in an accountable care plan by 2030.

This system shift is your penultimate leverage.

Ambulatory surgery centers embody healthcare’s triple aim: optimal health management, cost savings and improved patient outcomes. Your ASC offers the hospital a strong position for the future. That’s an opportunity they can’t afford to miss. When patient volume isn’t a primary profit metric, a collaboration between the hospital and the ASC is like the goose that lays the golden egg.

In short, although case volumes will likely slow with criteria adjustments, routine cardiology procedures have already started moving from the hospital to the ASC. There’s no going back now; the delivery of cardiac care has changed forever.

Surgery centers are the heart of a value-based future, and that future is fast approaching. So, if you want to position your ASC as a leader in cardiac care, now is the time.

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U RO LO G Y

Q&A

Urology ASCs and Winning Strategy

BY JESSICA ROBERTS-BECERA R.N., M.S.N., NE-BC Urology has been a steady performer for years in the ASC space.

There are headwinds and tailwinds with the ever-changing climate of healthcare. Dr. Abhishek Srivastava is a board-certified urologist and urologic oncologist who practices in Myrtle Beach, South Carolina, with Atlantic Urology and operates at Parkway Surgery Center. He is esteemed for high-quality, patient-centered care specializing in all urinary conditions and urologic oncology. Dr. Srivastava discusses the benefits, advancements, and catalysts in the urology ASC.

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WHAT DO YOU PERCEIVE AS THE BIGGEST

Q ADVANCEMENTS NOW OR UP-AND-COMING IN THE ASC SPACE?

The ASC space is currently going through a paradigm shift in independent, large group practices. Major hospitals and academic centers are investing in surgery centers to improve patient care and experience. We will see the introduction of MIS and robotic surgery in ASC space as the reimbursements and cost of robots improve. One of the latest robots from Intuitive Surgical— single port (SP) robot— allows same day discharge with ease and could make its mark in the ASC space.

There is also better pain management, anesthesia and enhanced recovery protocols, which will make it easier to discharge patients comfortably after complicated surgical procedures.

• Mini-PCNL stone treatment for large stone burden.

• Transperineal prostate biopsies—a novel way to perform prostate biopsies with reduced infection rates.

WHAT ARE THE BIGGEST PITFALLS AHEAD

Q THAT UROLOGY ASC MAY NEED TO MITIGATE?

s

The upfront cost of equipment such as laser and other instruments, with declining reimbursement from CMS and insurance carriers, could prevent urology ASCs, especially independent or physicianowned, from growing. The other challenge urology ASCs face are staff and anesthesia provider shortages, as the independent ASCs must compete with larger hospital systems.

IS THERE A FUTURE FOR ROBOTICS IN

Q UROLOGY IN THE ASC SPACE?

Absolutely. Robotic surgery has already transformed most of the urologic surgeries, and urologists have been at the forefront of innovation with robotic surgeries in the most confined spaces possible. With newer and competitively priced robots hitting the market in the next five years, the future of robotics is very bright in urology ASCs. Initially, the high cost of robotic systems was a major barrier for ASCs. However, falling costs of robotic platforms, along with leasing options and shared-use models, are making robotics more financially viable for smaller centers.

ARE THERE CURRENT INPATIENT

Q PROCEDURES THAT COULD BE MIGRATED TO ASCs?

There are opportunities for several urologic procedures such as robotic prostatectomy, partial nephrectomy, pyeloplasty (especially single port procedures), PCNL, and urologic reconstruction procedures to be migrated to ASC. However cost and reimbursement issues are currently prohibitive.

Careful patient selection is critical to ensure safety in an ASC setting.

WHAT ARE THE BIGGEST OBSTACLES YOU

Q

WHAT ARE THE NEWEST PROCEDURES THE ATLANTIC UROLOGY TEAM IS BRINGING INTO YOUR ASC SPACE?

• Jelmyto to treat upper tract cancers—can easily be performed and we can save kidneys in lowgrade tumors.

• Optilume for BPH and urethral stricture disease—another great alternative to all treatment options we have.

• BioProtect rectal-sparing procedure prior to radiation treatment for prostate cancer.

• Barrigel—a similar procedure for rectal sparing.

• IPP penile prosthesis for ED. • Sacral neuromodulation implant for urge incontinence.

Q FACE IN RUNNING AN INDEPENDENT

UROLOGY ASC, AND HOW IS YOUR GROUP WORKING TO OVERCOME THOSE OBSTACLES?

Competition from larger healthcare systems can be challenging but our focus is on delivering quality care through specialists who provide superior clinical outcomes.

Declining reimbursement rates from Medicare, Medicaid, and private insurers are a significant concern for urology ASCs. By negotiating better rates with payers and adopting cost-efficient practices, we can mitigate some of these obstacles. Participating in value-based care models can also help ensure stable revenue streams.

As previously mentioned, shortages in staff and anesthesia providers are the biggest challenges

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U RO LO G Y

for any independent ASC. By offering competitive salaries, flexible schedules, and fostering a positive workplace culture, we can improve staff retention.

Cross-training staff can reduce the need for a large workforce while maintaining high standards of care.

Surgery Center, allows us to perform high-demand outpatient procedures more efficiently, with the added flexibility of adopting advanced technology and innovations.

IS THERE ANY ADDITIONAL ADVICE YOU

Q

WHAT ADVICE WOULD YOU GIVE TO OTHER UROLOGISTS, RESIDENTS AND FELLOWS LOOKING TO GET INVOLVED IN AN ASC?

Understanding the business model of ASC and choosing the right ASC—single specialty versus multiple specialty—is especially important. Also understanding buy-in, revenue distribution and cost-saving strategies can help them make the right decision. Young urologists should focus on building strong referral networks and stay updated on regulatory, compliance, reimbursement and technological trends. ASCs provide a unique opportunity to enhance patient care, improve worklife balance, and gain financial rewards, but success in this setting requires strategic planning, continuous learning, and collaboration.

WHAT ARE WAYS YOU BENEFIT MOST FROM

Q HAVING AN ASC WITHIN YOUR GROUP?

Improved patient care, outcomes, and satisfaction with greater control of surgical schedules are some of the most important things for us. We also benefit from faster turnaround times, and we can perform over 30 cases easily in one day with two anesthesia rooms. Our surgery center, Parkway

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Q WOULD LIKE TO ADD?

As most urology procedures shift to an outpatient setting, urology ASCs will hopefully continue to prosper. Independent physicians, practices, and hospitals will continue to invest in this model to improve patient experience and outcomes. T _____ Thank you, Dr. Srivastava, for your insights, experience, and advice in the urology ASC environment. Urology ASCs can function well independently and require a team that is committed to quality and understands how to navigate and pivot in the healthcare climate.

Atlantic Urology and Parkway Surgery Center have been a pivotal community partner that continues to grow and make a difference. As certificates of need begin to repeal or dissolve, urology is a specialty that can be integrated seamlessly with other specialties. This would be an excellent service line to consider bringing into an orthopedic ASC, as an example, due to the multifaceted approach both specialties possess. As urologic procedures are removed from Medicare’s inpatient list, the need will only increase for this specialty in the ASC space.

Navigating the headwinds and tailwinds in an ASC can be challenging but yield great rewards and impact communities providing greater access to care.

NUTRITION

Preoperative Nutritional Optimization in Ambulatory Surgery Centers

S

A “WIN-WIN” OF OUTCOMES AND ANCILLARY REVENUE

BY PATRICK DENARD, M.D.

Surgeons and ambulatory surgery centers (ASCs) are under continued pressure. Major forces at play include heightened scrutiny over patient outcomes, increased patient activity demands, and declining reimbursements. Typical responses to these pressures have focused on improving patient satisfaction, boosting efficiency, and reducing costs. However, an often-overlooked opportunity lies in optimizing preoperative nutrition.

In the surgical arena, there is often a disconnect between surgery and nutrition for patients. Medical training provides little guidance on this subject, leaving patients to navigate the complexities of nutritional supplements on their own. Increasingly, studies support that proper nutrition positively affects recovery, and patients are becoming more aware of its role in their healing journey. This intersection provides an opportunity for ASCs and surgeons to improve patient outcomes while generating ancillary revenue.

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THE EVIDENCE

It is estimated that nearly half of all surgical patients are malnourished or at risk of malnutrition. Nutritional status directly correlates with the risk of complications and extended hospital stays. Even in healthy young men, muscle volume decreases after just two days of bedrest.

The core of perioperative nutrition is protein supplementation (typically for four weeks) and a preoperative carbohydrate drink.

Protein requirements double after surgery as the body responds to increased stress, yet surgical patients often meet only 30% of their protein requirements.

Several studies show that amino acid supplementation, particularly leucine, can improve the speed of recovery. Randomized controlled trials of protein

or amino acid supplementation in the perioperative period demonstrate notable improvements, including increased spinal fusion rates (83% versus 60%), greater knee extension 12 weeks after total knee replacement, fewer complications after fracture fixation, and reduced pain after total knee replacement.

Preoperative carbohydrate loading is another critical element, preventing the insulin resistance commonly triggered by prolonged fasting.

A carbohydrate drink consumed the night before surgery (100 grams) and optionally two hours prior (50 grams) is a key component of Enhanced Recovery After Surgery (ERAS) protocols.

A Cochrane review across multiple surgical specialties concluded that a single preoperative drink can reduce the length of hospital stay without adverse effects. Additional studies report a reduction in postoperative pain.

ANCILLARY OPPORTUNITY

Over-the-counter protein powder rarely contains the levels of leucine that are scientifically shown to be effective. Several companies now offer evidencebased perioperative nutritional optimization directly to patients. Complete Surgical Nutrition, for example, provides a surgical nutrition kit that includes a four-week supply of protein high in leucine and a preoperative carbohydrate drink.

Patients receive a one-page flyer from their surgeon or ASC, allowing them to order the kit, which is delivered to their doorstep. This approach minimizes the administrative burden on the surgeon or ASC. Other companies in this space include Mend, Enroute, and Xcelerated Recovery.

Since nutritional supplements are nonprescription, they present a cash-pay opportunity. This allows renumeration to the surgeon or ASC for nutritional items and without violating federal guidelines. The American Medical Association guidelines on such renumeration programs include the following: • Offer only products whose claims are based on peer-reviewed literature or other sources of scientific review of efficacy that are unbiased.

• Address conflict of interest and possible exploitation by disclosing the financial relationship and limiting sales to products that serve immediate needs of patients.

• Provide information about risks and benefits.

• Avoid exclusive distributorship arrangements that make the product only available through physician offices.

• Renumeration programs can vary from $30 to $100 per unit purchased by the patient. For an ASC performing 3,000 surgeries annually, a 25% patient adoption rate could generate up to $75,000 in additional revenue. This does not include the potential for savings in length of stay in an environment in which minutes lead to increased cost.

Just as athletes prepare nutritionally to enhance their performance, patients should be nutritionally prepared to handle the stress of surgery. A growing body of evidence supports the role of nutrition in improving outcomes and lowering lengths of stay with little to no downside. For surgeons and ASCs, the intersection of this scientific evidence with the potential for ancillary revenue creates a promising opportunity to enhance both patient care and financial performance. T _____ Dr. Patrick Denard is a shoulder specialist at the Oregon Shoulder Institute, director of the Oregon Shoulder Fellowship, and author of more than 300 peer-reviewed articles.

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BUSINESS BREAKDOWN

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The Business of Ambulatory Surgery

BY BRITTANE L. STRAHAN, MSN RN CCRP

T

CONVENIENT. COST-EFFECTIVE. SAFE.

These words can be associated with a well-functioning ambulatory surgical center (ASC). Patients have their surgeries and are sent home on the same day, while still receiving highly specialized care.

As medicine continues to improve and expand, some previously in-house-only procedures have moved to the ambulatory setting. Many specialties and teams now practice at an ASC and offer a valuable service to their community. Patients experience shorter stays and faster recovery times; staff are highly trained and the cost is lower.

Several common surgeries, including lumpectomy, carpal tunnel release, vasectomy, and tubal ligation, have moved into the outpatient realm. We will dissect (pun intended) some of these common outpatient surgeries from a financial perspective.

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BUSINESS BREAKDOWN

Common Procedures

LUMPECTOMY

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PROCEDURE

INSTRUMENTS

A lumpectomy is also known as a “partial mastectomy.” During this procedure, the surgeon removes cancerous breast tissue while leaving healthy tissue intact. It is viewed as a potentially curative treatment.

There are four types of lumpectomies, and the extent of the cancer dictates the surgical plan. The goal is to obtain tumorfree margins and eliminate the need for re-excision.

Taking an average of one to two hours without a reconstruction, a marker or clip is inserted under CT or MRI guidance. Anesthesia is administered, and the breast tissue is excised along with sentinel lymph nodes. A new clip is then placed for radiation planning.

Numerous instruments are used for a lumpectomy, including:

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• • • • • • • • • • • •

Curved hemostat Tonsil clamp Forceps Kocher Allis Adson Debakey Toothed Scissors Metzenbaum Mayo (curved and straight) Non-toothed pick-up

• • • • • • • • • • •

No. 3 knife handle Smooth Adson Needle holders Ryder Mayo-Hegar Crile Retractors Army-Navy Weitlaner Senn Freer skin hooks

BILLING Billing is done as a “single episode,” denoting cost-effective, highquality care. Coding should include both the ICD-10 diagnosis code (C50 or D05) and procedural codes.

19301

Partial removal, breast

19302

Partial removal, breast and underarm lymph nodes

38525

Excision procedures, lymph nodes/ lymphatic channels

38900

Other procedures, hemic or lymphatic system

76998

Other diagnostic ultrasounds

CARPAL TUNNEL RELEASE PROCEDURE

VASECTOMY PROCEDURE Vasectomy is a permanent form of male birth control, and there are two approaches (incision or no-scalpel). During the procedure, the physician ties, clips or cauterizes the vas deferens.

INSTRUMENTS The choice of instruments will vary based on the method.

INCISION: • No. 3 scalpel handle • Scissors • Metz • Iris (straight and curved) • Forceps • Adson (tissue and serrated dress) • Allis • Halsted mosquito (straight and curved) • Mayo-Hegar needle holder

NO-SCALPEL: • Large rubber band • Straight hemostat • Iris scissors • Forceps • Allison with teeth • Vas fixation ring • Hemoclip alligator and medium clips

A carpal tunnel release relieves the pressure on the medial nerve of the wrist. Three techniques, including an open, endoscopic or ultrasound-guided approach, can be used. In all cases, the carpal ligament is cut to widen the tunnel.

INSTRUMENTS Instrumentation depends on the surgical modality.

Pre-made disposable kits may reduce costs related to reusable equipment cleaning and preparation.

OPEN: • Blades (with handle) • Hans Lee • Beaver • #15 blade • Pediatric nasal speculum • Iris scissors • Adson forceps • Needle driver

ENDOSCOPIC: • Endoscope • Left-guide/ Right-guide • Synovial dilator/ elevator • Retrograde knife • Ligament probe • Ligament rasp • Hemostat • Adson forceps • Standard hand dissection kit

ULTRASOUNDGUIDED: • Ultrasound probe • Scalpel • Hook knife

BILLING

BILLING The ICD-10 code (V25.2) is applied with the procedural code; several are available to choose based on method.

55250

Vasectomy, unilateral or bilateral (includes post-op semen check)

55450

(Deleted) Percutaneous ligation of vas deferens, unilateral or bilateral

55559

Laparoscopic vasectomy

All codes are meant for unilateral use, however, bilateral procedures can be billed twice or appended with “-50.” In addition to the procedure codes, ICD-10 codes (G56.00-G56.03) must be applied. Finally, “64721” is used if an endoscopic procedure is converted to open.

29848

Endoscopy, wrist, surgical, release transverse carpal ligament

64721

Neuroplasty and/or transposition, median nerve at carpal tunnel

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BUSINESS BREAKDOWN

CostSaving Methods TUBAL LIGATION PROCEDURE Tubal ligation is a reliable method of female sterilization with two surgical approaches.

Ligation ties or occludes the tubes, whereas transection severs them by cutting, burning or removal. Laparoscopy is used in an ASC and requires general anesthesia. The tubes are cut, burned or occluded and the incisions are closed.

INSTRUMENTS • • • • • • •

Laparoscope Trocars Umbilical Additional Uterine manipulator Laparoscopic graspers Blunt probe

Depending on method: • Bipolar cautery • Falope ring applicator • Spring clip applicator • Filshie clip applicator • Endoloops • Endoscopic scissors

BILLING When coding for a tubal ligation, the ICD-10 codes (Z30.2) must be used with the procedural codes. The specific code will depend on the method.

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58600

Ligation or transection of unilateral or bilateral fallopian tube(s)

58615

Fallopian tube(s) occlusion (band, clip, ring)

58670

Laparoscopic; fulguration of fallopian tube(s) with or without transection

58671

Laparoscopic; occlusion (band, clip, ring)

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Several different methods can optimize cost efficiency. These include managing inventory, streamlining workflow and renegotiating payer contracts.

ASCs provide a convenient, cost-effective and high-quality option for surgery outside of the hospital. Methods and materials should be frequently evaluated to determine where expenses can be minimized and profits increased. Increased opportunities benefit not only the ASC but the community it serves.

INVENTORY AND SUPPLY MANAGEMENT

One of the richest opportunities for cost savings in an ASC lies in evaluating the use of both disposable and reusable equipment. Each product type should be evaluated for its need, usage, and cost efficiency.

DISPOSABLES

Typically, disposables such as towels, drapes, and irrelevant kit items are subject to a high percentage of waste. Audits can determine the count of disposable items for a particular surgery. All items must be counted before and after surgery by at least two staff members.

Packages of disposable items should be opened only as needed after an initial quantity has been prepared. Pre-packaged kits made for specific surgeries may be worth investigating.

Moveable carts and small, stocked supply cupboards present other waste reduction

opportunities. Both can increase efficiency during a procedure and when restocking a room between cases. One potential downside is that inventory may appear low in the central hub if the smaller locations and carts are well stocked.

A good inventory management program/manager is crucial to ensuring an accurate inventory and negotiating better vendor prices.

Finally, staff must regularly evaluate the contents if pre-made kits are used. There also needs to be consistency among staff utilization to minimize wasting kits to obtain one or two particular items.

STREAMLINED WORKFLOW

Staffing is the most significant expenditure of an ASC. Some potential ways to optimize profitability include: • Employing trained and certified coders to request the correct reimbursement.

• Keeping billing in-house to ensure consistency and accuracy.

• Scheduling those who are most knowledgeable and adept for particular procedures.

• Utilizing staff for non-surgical tasks (pre-op or post-op patient calls).

• Reducing wait times.

• Using consistent operating room designs to make it easier for staff who travel to different sites.

RENEGOTIATING CONTRACTS WITH PAYERS

ASCs have lower operating costs, which are passed on to the patient; however, they also receive lower payments from payers such as Medicare. Contracts should be closely evaluated and renegotiated regularly. This also opens the door for increased surgical offerings and revenue.

Finally, ambulatory payment classifications (groupings of payments per service) may cover items or services beyond the usual scope of what is reimbursed. T

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O

Outpatient Procedures: Billing and Supplies

BY BRITTANE L. STRAHAN, MSN RN CCRP

Outpatient surgical procedures, such as liposuction, mediport placement, spinal fusion and tonsillectomy, require meticulous coordination of billing, instrumentation and coding to ensure both clinical efficiency and accurate reimbursement. The art of medicine goes beyond the surgical aspects involved. It involves a collaboration between medicine, finances, and performance. All three elements have to come together to have a successful outcome. The diverse array of equipment required for each procedure highlights the critical role of accurate billing and supply management. Ensuring that both medical practitioners and administrative staff are well-versed in the correct procedural codes is key to streamlining operations and maintaining compliance with regulatory standards.

Here is a list of common surgeries performed in ASCs, together with the mechanics that go into their execution. In a series of articles in our ensuing editions, I will continue to discuss and elaborate on the spectrum of specialty surgeries performed across the board.

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INSTRUMENTS Numerous instruments are used and include: •

LIPOSUCTION PROCEDURE Liposuction is considered cosmetic surgery and can remove excess fat from the abdomen, arms, thighs, hips and buttocks, among other sites.

Four different methods can be used for this procedure including: • Suction-assisted • Ultrasound-assisted • Laser-assisted • Power-assisted The chosen technique will depend on the anatomical location, any previous liposuction history, and the cosmetic goals.

The average procedure length varies, but it could take up to several hours.

BILLING Coding should include both the ICD-10 diagnosis code (site and indication specific) as well as procedural codes. Some relevant ICD-10 codes may include: L98.7, M79.3 or Z41.1. Code N62 should be used for gynecomastia.

15877

Suction lipectomy, trunk

19300

Removal of breast tissue (for gynecomastia —do not bill 15877 separately)

•

• • • • • • • • • •

Cannulas • Smooth harvester with microports • Aggressive multiport harvester • Infiltration • Basket-shaped • V-shaped portless dissector • Tumescent infiltration • Stevens style, standard (one, two and three ports) • Reverse pyramid • Sharp extractor injector • Moderate multiport harvester—both end bevel • Micro hole injector—blunt tip • One central upper hole, two lower lateral holes • Two lateral upper holes, one central lower hole • Half cut tip • Six spiral ports • Three spiral ports • Kotzur—nine ports • Infiltration (face lift, bayonet, or angled) • Fork dissector • Flap dissector—single port • Double Mercedes • Mercedes • Double basket • Blunt tip (curved or straight) • Cobra (bevel or round tip) • Spoon tip (curved or straight) • Pyramid—three ports • Blunt extractor-injector • Aggressive multiport harvester—both ends sharp • V-shaped dissector—single port • Deep cut dissector • Candy cane Fat transfer adapter • Luer to Luer • Toomey to Luer • Toomey to Toomey Nano fat processing set Nano fat filter Mesh for nano fat filter Cannula handle Vacuum aspirator—automatic syringe Fat re-injecting gun Aluminum snap locks Twist lock (syringes) Syringe stand *Specifically for anaerobic transfers: • Emulsifier adopter • Decant stand

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SPINAL FUSION PROCEDURE A spinal fusion is performed to stabilize the spinal column and reduce pain in the case of spinal degeneration. Used to treat many conditions, including herniated discs, scoliosis, spondylosis, and spinal fractures, it is viewed as a potentially curative treatment.

The approach, incision type, and materials used will depend on the specific indication and provider discretion. This surgery can be performed endoscopically or in an open manner.

A spinal fusion averages between one and five hours of procedure time depending on the chosen approach, extent of repair and materials used.

INSTRUMENTS Numerous instruments are used and include: RETRACTORS: • Markham Meyerding (left and right 18cm) • Beckman-Eaton sharp (32cm) • Coward lamina (16cm) • Lane (23cm) • Scoville nerve root (7mm/19cm) • Caspar lamina spreader (16cm, 90mm) RONGEURS: • Kerrison laminectomy (40°) (2mm, 3mm, and 5mm by 180mm) • Cushing (5mm by 150° upward and 7mm x 25cm) • Oldberg (7mm x 25cm) • Schlesinger (2mm by 10mm) SCISSORS: • Dressing scissor TC (straight18.5cm and 20cm) • Metzenbaum (15cm) • Dietrich (45°, 16cm) • Potts Smith TC (60°, 19cm)

• Stille Horsley bone cutter (27cm) • Caspar vertebral body distractor • Caspar screwdriver • Caspar drill guide • Caspar distraction screw (16mm, 7cm) • Caspar twist drill (1.7mm; drilling depth 8mm) • Cobb spinal fusion gouge (6mm, 28cm) • Williger bone curette (3mm by 4.2mm/ 13.5cm) • Caspar dura hook (24.5cm) • Willinger mallet (30mm head; 14oz; 24cm)

*The specific equipment may vary based on the surgical approach and exact method for fusion.

BILLING Many ICD-10 codes can be used to support the medical necessity of a spinal fusion. Billing codes should be selected on anatomic location and approach.

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22533/ 22534/ 22558/ 22585/ 22612/ 22614/ 22630/ 22632/ 22633/ 22634/ 22800/ 22802/ 22804/ 22808/ 22810/ 22812

Arthrodesis codes

22853/ 22854/ 22859

Biomechanical device insertion

63052/ 63053

Laminotomy or Laminectomy

MEDIPORT PLACEMENT PROCEDURE

INSTRUMENTS

A mediport is placed for the central administration of intravenous medications for cancer and other chronic conditions. It can also be used for venous access when blood work is needed.

Inserted into the superior vena cava, the port allows for quick access and less discomfort or difficulties with venous access than a traditional IV stick. A single lumen is the most common port type; however, in some cases a double lumen port may be more appropriate. Power ports may be used for intravenous contrast for CT and MRI. From start to finish, the procedure takes about an hour.

Numerous instruments are used and include: • • • • • • • •

Curved hemostat Tonsil clamp Forceps: Adson and Debakey Scissors: Metzenbaum and Mayo (straight) No. 3 knife handle Retractors: Army-Navy, Weitlaner, and Senn Needle holders: Ryder and Mayo-Hegar Freer skin hooks

BILLING Coding should include both the ICD-10 diagnosis code (Z45.2 and the appropriate cancer code) as well as procedural codes.

36561

Insertion of central venous access device

77001

Under fluoroscopic guidance

76937

Under ultrasonic guidance procedures

INSTRUMENTS Numerous instruments are used and include:

TONSILLECTOMY PROCEDURE Tonsillectomy is the removal of tonsils for hypertrophy, possibly to the point of sleep apnea, and frequent infections. While this is typically a childhood procedure, it can also be done on adults if indicated.

The traditional method removes all tonsillar tissue while the intracapsular method leaves a small piece of tonsil covering the underlying muscle. There are multiple techniques that can be used to remove the tonsil tissue.

On average, a tonsillectomy takes between 20 to 60 minutes. This time varies based on approach, anatomical challenges and other surgical complications.

• Meltzer adenoids nasal punch (5 inch); shaft small; triangular jaws • Yankauer suction • Scissors: Metzenbaum (curved) • Towel clamp • Knife handle No. 7 • McIvor mouth gags set • Forceps: Mikulicz, White one open ring (medium curve—9.5 inch), Schnidt (7.5 inch; slight curve and strong curve with one open finger ring) • Ballenger tonsil sponge straight with serrated jaws (7 inch)

• Needle holders: Crile wood (6 inch and 8 inch) • Barnhill adenoid curette (size 0, 1 and 2) • Uvula retractor (18mm) • Adenotome (10mm blade, size 0 and 16mm blade, size 2) • Large tongue depressor • Tonsil knife (8.5 inch) • Tonsil dissector and pillar retractor (8.75 inch) • Tonsil snare (straight and vedder tips and sage)

*The exact approach and technique will determine which instruments are used.

BILLING Coding should include both the ICD-10 diagnosis code (C50 or D05) as well as procedural codes.

42820

Tonsillectomy and adenoidectomy (<12 years old)

42821

Tonsillectomy and adenoidectomy (>=12 years old)

42825

Tonsillectomy, primary or secondary (<12 years old)

42826

Tonsillectomy, primary or secondary (>=12 years old)

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BORING BUT CRITICAL

BY A L E X A LC O N

CMS may add Social Determinants of Health, or SDoH, data into quality reporting guidelines for ambulatory surgery centers. If the proposal is implemented, the reporting will be mandatory by 2026. SDoH reporting is untested in surgery centers, and no data collection tools have been validated. Medical doctor and board member of the ASC Quality Collaboration David Shapiro is against the proposal, doubting the usefulness of SDoH data in ASCs. He says, “These measures would wind up as unfunded, inappropriate, and unactionable mandates shoved down our throats and wouldn’t improve patient care.”

CMS still requires COVID-19 vaccination reports—a week’s worth of data once per month. The 2025 CMS proposal recommends keeping the stringent reporting requirements in place, even though the vaccine is no longer mandated for employees. The ASC Association opposes it and on September 9, the ASC Quality Collaboration submitted a request to CMS to change the requirements. Instead of monthly submissions to the NHSN, surgery centers would send data annually via a hospital quality reporting system, effectively lowering administrative burdens.

The updated reimbursement rates for CY2025 are also causing a stir among healthcare providers.

Hospitals and surgery centers that meet reporting requirements are receiving the same 2.6% increase across the board. This static increase is receiving widespread criticism, since it does nothing to close the gap in payer rates between hospitals and ASCs.

Surgery center advocates and surgeons are frustrated with the new covered procedures in the CMS 2025 proposal. Although 18 new cardiac and spine codes were submitted for consideration, the proposal didn’t include them.

Twenty new surgical and dental codes were added, but the new cardiac and spine submissions weren’t addressed at all. Providers want the agency to trust their experience and expertise, emphasizing that they are only submitting procedures with evidence of success and safety.

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