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Securing Payer Contracts for Your De Novo ASC – It’s About Time!

Securing Payer Contracts for Your De Novo ASC – It’s About Time!

By ASC Development, Payor Contracting No Comments

Does anything matter more to your de novo ASC’s long term operational success than reimbursement rates and volume? Yes! While both reimbursement and volume are important, buying yourself the time required to secure credentialing, carefully negotiate reimbursement rates, and execute contracts with your key commercial payers is integral to your new facility’s success. They say, “Time is money.” In this scenario, that translates into securing adequate capital to cover operating costs while you accomplish crucial contracting tasks on behalf of your ASC.

Assessing Your Needs

Consider the following when assessing the cash reserves, line of credit, and time your de novo ASC will need during the payer contracting ramp-up stage of your development project.

Payer Credentialing

Credentialing for the newly developed ASC will take time. Credentialing requirements vary by payer. Some payers may require your new facility to receive approval from Medicare of its enrollment application prior to accepting your ASC’s credentialing application. To complete Medicare’s enrollment application, your ASC must perform several “test” cases. The current requirement is 10 cases. These cases will involve coverage from insurers other than Medicare. It not only takes time to perform these cases, it also takes time to select them from your surgeons’ patient pool of cash pay, workers’ compensation, auto, or charity cases that are readily available for surgical care shortly after your ASC opens. Completing this portion of the process can take several days to several weeks.

Some payers may require your ASC to be certified by Medicare and/or accredited by one of the CMS-approved accreditation organizations prior to completing credentialing. Once your new ASC’s Medicare enrollment application is approved, your facility will be placed on Medicare’s unannounced survey calendar. This means a surveyor may show-up anytime in a 90-day window for the on-site certification survey. Then, once the certification survey is finished, it may take several more weeks for the parties to exchange and/or process documentation before Medicare issues your certification letter. The certification letter provides your ASC with its Medicare number and Provider Transaction Access Number (PTAN). This portion of the process can take several months and must be accounted for in your project timeline.

Finally, once your ASC meets all the credentialing documentation requirements mandated by payers, it may take several more weeks for their credentialing committees to review and approve your credentialing application. Even if all goes well with credentialing, contracts cannot be executed before reimbursement is negotiated and each payer loads each agreement into its claims processing system.

Reimbursement Negotiations

Negotiating reimbursement rates take time. It will take time to obtain optimal reimbursement – or rates that are close to what you need – because payers often attempt to pay new ASCs lower than existing ASCs. This may be because payers view new ASCs as low hanging fruit on the cost-savings tree. Payers see an opportunity to save money by proposing lower reimbursement which, unfortunately, is quickly accepted by some new cash hungry ASCs.

From a short-term perspective, it may appear to make sense for a new ASC to accept the proposed low rates to secure payer contracts which then allows them to quickly start seeing commercial patients. However, in the grand scheme of things, the ASC is not solving a problem – it’s just delaying a problem. Such a situation gives rise to artificially setting market rates which takes additional time and effort to resolve during subsequent renegotiations.

It takes time and effort to secure reasonable reimbursement. It may take your new ASC a few to several months to negotiate agreeable reimbursement and contract terms with all its major payers. While some negotiation efforts can begin before the facility opens, most payers will not take new ASCs seriously until they open their doors. Maybe that’s because, until your doors are open, an opportunity cost to the payer and its members does not exist.

Executing Contracts

Waiting for payers to load the contracts you negotiate takes time. It generally takes 30-45 days, depending on the payer and the time of year, but occasionally it can take well over two-months. Oftentimes, the only thing your ASC can do during this stage is hurry up and wait. Therefore, the time spent in this portion of the process must be accounted for as well.

Gathering Resources

Having access to adequate capital to meet your ASC’s operating costs for 6-12 months after you open may be necessary to buy the time you need to secure your payer contracts. This is an important consideration when selecting a lender and applying for a line of credit for your de novo ASC.

No one can say exactly how long it will take. However, you should be financially prepared to spend a significant amount of time in the payer contracting ramp-up period. There is no way to get around this often-lengthy time investment, but laying the proper reimbursement foundation is a key component of your de novo ASC’s long-term success.

Dan Connolly, VP of Payer Relations & Contracting

Preparing for an ASC Accreditation Survey

Preparing for an ASC Accreditation Survey

By ASC Development, ASC Management No Comments

They walk in the door without an appointment. Staff immediately know they are not patients or family members. Within minutes, word has spread throughout your facility – your center is about to undergo an ASC accreditation survey.

Surveys are a fact of life in the ASC industry. Whether they are performed by surveyors from the Centers for Medicare and Medicaid Services (CMS), your state’s department of health, or an accreditation organization, doing well on surveys is critical to your ASC’s success. Poor survey performance can jeopardize your licensure, Medicare certification, and/or accreditation. Lose any of these and you are looking at a loss of insurance contracts and patients.

More importantly, poor survey results may indicate shortcomings that have the potential to jeopardize patient and staff safety. ASC accreditation survey requirements, while they may feel cumbersome, are designed to help support the delivery of safe, high-quality care. By meeting them, you demonstrate a commitment to the wellbeing of everyone served by your ASC.

While your ASC should always strive to meet requirements (more on this later), survey preparation is a worthwhile exercise. Preparation can help shore up deficiencies and ultimately improve survey performance – a win-win combination.

ASC Accreditation Survey Areas of Focus

Here are some areas to focus on prior to an ASC accreditation survey to help improve your likelihood of success.

Policies and procedures. Carefully review your ASC’s policies and procedures. Make sure staff are adhering to them as written. If any policies are outdated, update them. If you have added new policies and/or procedures but lack written documentation, create it.

Physician credentialing. Ensure your physicians are credentialed and their files include all required – and current – documentation. Each physician has numerous documents with expiration dates that differ from physician to physician and document to document. Without careful monitoring, it’s likely one or more of these documents will expire. Expect a surveyor will catch any such lapse.

Personnel records. Keep employee files current and complete. Documents in these files should include job description, competency assessments, training records, performance evaluations and I-9s (used to verify identity and employment authorization).

Decontamination area. Surveyors are paying greater attention to compliance with rules governing sterile processing areas. Under scrutiny is cleaning, disinfection and sterilization of scopes, and separation of clean and sterile processes. Make sure staff follow your policies and procedures and can explain how they adhere to guidelines and manufacturers’ instructions.

Infection prevention. While infection prevention has always been an area of focus for surveyors, it’s receiving even more attention these days. Work with your infection preventionist to ensure staff understand and are following proper processes. For example, if your procedure manual indicates “bonnets over the ears,” then make sure everyone has bonnets over their ears.

Emergency preparedness. Another area likely to face increased surveyor scrutiny during your ASC accreditation survey is emergency preparedness. This issue is in the spotlight thanks, in part, to the CMS Emergency Preparedness requirements that took effect in November 2016. Ensure your ASC has performed its required fire and other emergency/disaster drills and completed the appropriate accompanying documentation.

The basics. Regularly walk around your ASC and look for anything that seems out of place or could jeopardize compliance. Perhaps there’s a cart in the hallway when it should be in a closet. Maybe someone borrowed a policy and procedure binder and did not put it back. Identifying who made the mistake and using the experience as a teaching opportunity helps prevent recurrence of errors.

Perform a visual inspection of your restricted areas, checking for cleanliness. Conduct a “white glove test” on doors, screens, and operating room lights.

Staff preparation. Surveyors will inevitably ask your staff questions during their visit. Prepare your staff for this experience. Ask them questions you think a surveyor might ask. These questions can cover topics such as job responsibilities, policies and procedures, location of equipment, and emergency response.

While staff should be able to answer many such questions, they may not know all the answers. And that’s okay. Rather than make up a response that may be incorrect, instruct staff that it’s acceptable to say they do not know an answer but know where they can find it.

Maintain an ASC Accreditation Survey Mentality

Surveys tend to be infrequent events. This is no excuse for allowing compliance to falter in between surveys. Your staff should approach every day as if an ASC survey may take place.

Here are some quick tips to achieve this mentality:

  • Quiz staff. Keep staff on their toes by asking them surveyor-type questions. If someone doesn’t know an answer, you may have identified an area for additional education and/or training.
  • Conduct mock surveys. Periodically conduct mock ASC accreditation surveys. A member of your leadership team can fill the role of a surveyor, walking around the ASC and assessing performance. You can also bring in an outside, trained consultant to simulate the survey experience and identify compliance gaps.
  • Engage staff. Encourage staff to speak up when they identify potential compliance concerns. Treat these moments as learning opportunities rather than punitive incidents.
  • Don’t wait to educate. If you change a process, educate staff on the revision as soon as possible. Remember to update affected policies and procedures as well.

Working to keep compliance on the front of staff’s minds can help your ASC better meet requirements and ensure a consistently high level of care.

Kirk Lagonegro, Director of Operations

Choosing the Right Lender for Your De Novo ASC

Choosing the Right Lender for Your De Novo ASC

By ASC Development No Comments

Banking relationships are crucial to any successful business venture. Choosing the right lending partner for your de novo ASC development project is integral to the longevity of your financial asset. There will be times when you need an ally to watch your back financially. A lender who knows your business and is willing to be your partner throughout the process is essential. So, how do you select the right lender?

Submitting an RFP

During the feasibility phase of development after you have run your financial pro forma, send out a request for proposal (RFP) to at least three banking entities. Ensure you include one financial institution from the local market where the de novo ASC will be established. Banks in the local market are often more attuned to market conditions and may be willing to extend better rates or lower fees to win your business. Decide early on what type of services and resources you will need. Send your RFP to banking entities you’ve identified as strong providers of these services and resources. Make sure you give yourself enough lead time – at least 90 days – before needing any funds for the project.

A typical finance package will include:

  • Tenant improvements (TI) – if a separate real estate entity and core/shell will not be a part of your anticipated debt,
  • Equipment loan, and
  • Working capital via a line of credit (LOC)

Based on the credit history of the ASC partners, you should be able to obtain 70-80 percent loan to value on the TI. Investor contributions will be required to make up the remaining TI balance of 20-30 percent. Higher loan to value percentages (90-100 percent) are often available for equipment. The LOC will initially be revolving but, once your center is more established, the credit line is often rolled up into a fully amortized note.

Comparing Lender Options

After you receive the proposals, carefully evaluate the terms. There can be many variations in these proposals. Try to create a solid apples-to-apples comparison. Some variables to compare include rates, fees, maturity dates, early pay-off terms, corporate guarantees, and personal guarantees. Most of the language in loan agreements is derived from a standard template. You may want to have your attorney review these agreements, however, to ensure there are no hidden issues or concerns.

Although selecting the lender with the best terms may seem logical, make sure you factor into your decision your view of them as a long-term partner. Consider the banker’s accessibility, promptness, and flexibility. You may want to consider the location of the bank and how often you will need to physically visit it, if at all. Is the lender equipped to meet all your service needs, including digital services?

Ask questions such as:

  • How many ASCs do you currently work with/have worked with?
  • Who will be our direct contact should we have any questions or concerns?
  • What happens if additional funds are needed in the future or a re-amortization needs to occur?

A good lender will be straightforward and honest in his/her responses. Their focus should be on building a lasting relationship. If the bank doesn’t feel like a good fit for your business or service needs, it makes sense to look elsewhere. It’s important to find a lender who fits your business needs and feels like a good fit for you and/or your partners.

The Right Banking Partner

Selecting the right banking partner is an important early step in ensuring the success of your de novo ASC development project. Look for someone who is knowledgeable about your industry, your business needs, and the financial factors for success. The right lender will help transitions occur smoothly throughout the process. Knowing you have a financial expert who can help in times of need is reassuring and will let you focus on other matters that will make your de novo ASC an overall success!

Richard DeHart, Principal Partner

Effective Health Care Marketing Goes Beyond Driving Business

Effective Health Care Marketing Goes Beyond Driving Business

By ASC Management No Comments

Health care regulations and policies are constantly changing, which makes health care marketing dynamic and challenging. Most marketing focuses heavily on targeting the right audience and delivering a tailored message to that audience. If the message is successfully transmitted, it drives demand for the health care service and consequently increases business and revenue. However, more nuanced effort is required to effectively market your surgery center and drive revenue growth.

Although patients may arrive at the specialist’s or ASC’s doorsteps through effective advertisements or physician referrals, there is no guarantee patients will stay to receive treatment for the same reasons.

For effective long-term business growth and retention, patients need to view your ASC as a reliable, trustworthy, and competent place to receive care. This is not fulfilled through marketing alone; it requires commitment from your entire organization.

Building Trust with Patients

Health care fits into the service industry category, where trust is translated into currency. Patients seeking care are already experiencing some vulnerability and stress related to their health. From the moment your patients walk through the door, and even before this point, they are assessing how your ASC responds to their needs and the quality of service they can expect to receive. In other words, can they expect your ASC to live up to the expectations set forth by your marketing campaign?

Long gone are the days when companies were able to unilaterally control their marketing message. Nowadays, patients are doing the marketing for providers, whether the providers agree or not. Technology has provided a platform for consumers to express their feelings and experiences online about the businesses with which they interact.

One study by the Local Consumer Review has indicated positive online reviews make 73% of consumers trust a local business more.[1] It is crucial to understand how patient experience and brand reputation go hand-in-hand in an increasingly digital world.

Focusing on Patient Experience

Strong marketing strategies focus on optimizing patient engagement to enhance positive brand reputation. That engagement starts with the initial marketing, but it solidifies through the patient’s experience at the ASC.

Here are some ways to improve patient experience:

  1. Set expectations through patient education.

Offer patient education through different platforms to establish patients’ expectations for their care. Patients get frustrated when there is a lack of information about their procedure, which sets the stage for unintended miscommunication. By being proactive in creating simple, relevant guides, you will contribute to your patients’ overall perception and experience.

  1. Invest in customer service education for your staff.

Your staff is the “face” of your organization. Patients tend to care more about how they are treated than the facility’s appearance. Educate your staff on how to engage with patients in positive ways, and how to ask patients to provide feedback about their experience. You may also consider giving staff a simple flyer or cut sheet to hand to patients which outlines how to leave an online review for your ASC. Evidence shows that 70% of consumers will leave a review for your business when asked.[1]

  1. Invest time in communicating with your customers.

Technology has changed consumers’ expectations about how businesses communicate with them. Be aware of what patients are saying about your organization and be proactive in responding to what they are relaying. Let your patients know you are open to feedback, whether it’s good or bad.

Also, it is important to understand where to communicate with your patients. Although a recent study shows Yelp & Facebook are local consumers’ most trusted review sites,[1] other platforms are being used for consumer reviews. One of the services Pinnacle III provides to its facilities is managing each ASC’s online reputation. We foresee demand for patient interaction expanding, not decreasing.

  1. Have a service recovery plan.

This applies to both patients and referring physicians. As a physician, you value your relationship with your patient. As a surgeon, you value the trust other physicians place in you when they refer their patients to you. What if a mishap occurs that could potentially tarnish those sacred relationships?

It is wise to prepare your staff members to handle an unhappy patient or referring physician partner. By focusing on customer loyalty versus attempting to gain new ones, you may realize more positive benefits in the long run. Frederick Reichheld, author of the Loyalty Effect, stated that a five-percentage point increase in customer retention increases profits by more than 25 percent.[2]

Better Business at Your ASC

Targeting potential consumers with tailored marketing messages can help lead patients to your health care door, but their arrival is only half the battle. Comprehensive and results-driven health care marketing also incorporates the patient experience when they seek treatment at your physician office and/or ASC. Stay in-touch with the ever-changing health care market to make sure you are providing the best possible service for your patients’ needs. Seek to build trust with patients and you will be rewarded for your efforts. Recognizing and prioritizing each patient’s overall experience ensures health care marketing results in long-lasting, loyal relationships.

Alice Beech, Physician Liaison


[2] Reichheld, Frederick F., and Thomas Teal. The loyalty effect: the hidden force behind growth, profits, and lasting value. Harvard Business School Press, 2008.


Revenue Cycle Management Processes: Establishing a Status Quo and Incorporating Input from New Employees

Revenue Cycle Management Processes: Establishing a Status Quo and Incorporating Input from New Employees

By ASC Management, Revenue Cycle Management No Comments

It’s Monday morning and one of your billing office employees walks in with a bizarre patient statement. To make matters even worse, your employee’s work on the statement does not reflect your office’s revenue cycle management processes. Where did this statement come from? How long have your employees employed this process? Where did the communication go wrong?

Perhaps your organization is in growth mode and new staff began implementing experiences and practices from their previous employers. Their understanding of the best way to proceed may not align with your company’s established revenue cycle management processes. Additional education or retraining is necessary.

Perhaps it’s time to re-evaluate your processes to assess if they still meet your business needs. If you’re not auditing your current protocols, how do you really know they are effective?

Consider the following practices to ensure successful communication is being delivered to your billing office employees. These suggestions will also ensure your processes remain relevant and effective.

  • Create, implement, and adhere to a robust onboarding process. This helps managers and trainers provide each new employee with the same foundation. A key onboarding element is spending time in other departments to gain an understanding of how each department contributes to the process. If you don’t have a well-defined new employee onboarding process, you need one. The orientation period is the most important opportunity to position new employees for success.
  • Hold educational boot camps when issues arise. It may be much easier to hold short 15-minute topic-specific meetings to address identified issues, than a 30 minute or an hour-long meeting designed to cover multiple topics. This tactic will allow you to be very detailed in reviewing and educating your team about the specific processes or issues in question. Addressing one topic per meeting leads to a greater chance your team will adopt your revenue cycle management processes. Addressing multiple topics in the same meeting may cause the team to become overwhelmed and lose direction, not knowing what to tackle first.
  • Review your policy and procedure manual. Engage your team members in revamping or creating revenue cycle management processes. Allow them to review existing policies to determine if they are still relevant. Retraining and education naturally occur through this type of employee engagement — a win-win for your team.
  • Allow employees to cross-train or shadow in different departments. Confusion often occurs when multiple departments are part of a process. Allowing employees to cross-train or shadow in departments other than their own will help them understand the process in its entirety. Once they have a clear understanding of the entire process, they are better equipped to problem-solve in areas they can control to help their colleagues. Time spent cross-training or shadowing also allows employees to establish relationships and team build with one another.
  • Audit, and then audit some more. Audits don’t have to be cumbersome. A high-level review can reveal where you need to focus your attention. The issues you discover may apply to only one employee and may not be departmental problems.

Bottom line: don’t bury your head in the sand and hope for the best. When adding new team members, training, education, and communication are your best shots for success to ensure their understanding and continuous use of current, relevant revenue cycle management processes. Allowing new team members to suggest alternate ways of proceeding is a bonus for the organization. Their fresh perspective may lead to improvement of established or outdated processes.

Carol Ciluffo, VP of Revenue Cycle Management

ASC Business Office Checkpoints: Improving Your Surgery Center’s Bottom Line

ASC Business Office Checkpoints: Improving Your Surgery Center’s Bottom Line

By ASC Management, Revenue Cycle Management No Comments

If your ASC business office is not meeting their performance metric benchmarks, it may be time to re-evaluate your revenue cycle management policies and procedures. Business office personnel who serve on the front-end (scheduling and insurance verification, for example) and those who serve on the back-end (billing office personnel) must work as a team to achieve your ASC’s key performance indicators.

There are natural checkpoints built in to revenue cycle management. When striving to meet performance benchmarks, you and your staff can take advantage of these natural checkpoints if you know how to use them. For example, both your patient accounting system and clearinghouse have resources available to help identify opportunities for improvement. Additionally, internal tracking processes, including logs and dashboards, allow you to sort through preventable errors and identify staff members who need additional education and training.

Regular evaluation of revenue cycle policies and procedures on the front and back end of your process can assist supervisors, managers, and administrators address weaknesses, improve performance, and enhance your ASC’s bottom line.

Where do you start?

Begin your evaluation at the initial receipt of patient information. Schedulers and insurance verification personnel are at the front end of your financial flow. Accurate data entry is crucial to proper registration, eligibility, and authorization. Data entry errors, including incorrect policy numbers or failure to obtain subscriber date of birth, may create billing delays. To minimize unnecessary rejections and denials, consider developing and using a scheduling checklist.

A scheduling checklist includes guidelines on information your surgery schedulers must collect to ensure there are no omissions or errors when the ASC billing office submits a claim. This tool can reduce time delays in claim filing and eliminate the need to re-work rejected claims. Regular review of clearinghouse rejections can help you create and add to your scheduling checklist by identifying areas in which staff may be prone to making errors.

Monitoring patient benefits

Schedulers and insurance verification personnel also need a solid understanding of patient benefits. Knowing how to determine a patient’s outstanding deductible, predict coinsurance, pre-collect co-payments, and coordinate patient benefits are essential to success. To automate this process, integrate your clearinghouse whenever possible. Insurance websites also provide free tools that assist in determining patient benefits, eligibility, and financial responsibility. Evaluate the accuracy, efficiency, and effectiveness of your scheduling and verification team by running reports from your patient accounting system. Review the total dollars pre-collected each month and challenge your team to break their record the following month. Celebrate their successes! And ensure you educate staff about when and why to use an Advance Beneficiary Notice (ABN).[1]

Establishing self-pay policies for procedures performed at the facility which are not covered by insurance is also important. Ensure your team is familiar with in-network insurance carriers as well as the procedures and implants those carriers reimburse. Insurance carriers regularly publish and update pre-authorization lists. Track and evaluate denials attributable to no authorization, non-coverage due to place of service, and out-of-network write-offs. Set targets for the ASC business office team to increase collections and decrease denials. When target goals are met, reward your team for their efforts. Motivation and direction make a difference when seeking improvements.

What happens after submitting a claim?

Once a case is billed, use denial tracking to identify areas of education for coders and surgeons. Encourage coding staff to take a second look at medical necessity denials. A simple query to the physician can mean the difference between payment and non-payment. Review this information to identify areas for improvement. Denials related to bundling[2] might mean a coder requires additional education on proper modifier use. Medical necessity denials can indicate operative note templates need to be updated or coding staff need additional access to pertinent patient records.

Educate everyone about the cases that can and cannot be performed in your ASC. National Correct Coding Initiative (NCCI) edits and a list of approved ASC procedures can be found on the Centers for Medicare & Medicaid Services (CMS) website or the website for the facility’s Medicare Administrative Contractor (MAC).[3] Centralize front and back end staff access to your approved procedures lists and assign someone to review and update them on a regular basis.

Another checkpoint technique is separating the duties of your charge entry, payment posting, and follow-up teams. This introduces another layer of accountability. As your accounts receivable (follow-up) personnel work their aging reports, they can identify charge entry and payment posting habits that require education or training to improve accuracy and timeliness of account resolution. Payment posters will provide a second set of eyes on write-offs and can supply additional insight into tackling appeals and securing reimbursement. Accounts receivable personnel can also prevent timely filing issues by following up on accounts as soon as 30-45 days after the date of service. Regular reconciliation of unbilled claims in comparison to cases performed prevents missed cases.

Improving the flow in the ASC business office

There are numerous opportunities to tighten the flow of patient information from scheduling to final payment. Cross-checking information at critical points in the ASC revenue cycle reduces billing delays and preventable denials. Separation of duties among ASC billing office staff allows you to build natural checkpoints into your system, preventing costly errors including unnecessary write-offs. Once areas for improvement have been identified, set achievable goals and timelines for your staff, then celebrate their successes.

Bethany Bueno, Director, Billing Operations, Specialty Billing Solutions

[1] An Advance Beneficiary Notice (ABN) is given to patients to forewarn that Medicare may deny payment for their treatment.

[2] A bundling denial occurs when a procedure requires a qualifying procedure be received and covered and the qualifying other procedure has not been performed or adjudicated. A denial related to unbundling occurs when several CPT codes are billed for a service when one inclusive code is available.

[3] A Medicare Administrative Contractor (MAC) is a private health care insurer that has been awarded a geographic area or “jurisdiction” to regionally manage the policies and medical claims for Medicare Part A and Part B Fee-For-Service (FFS) beneficiaries.

Does Securing a Team Partner Make Sense for Your ASC?

Does Securing a Team Partner Make Sense for Your ASC?

By ASC Development, ASC Management, Leadership No Comments

I recently read a theory about teams in the workplace from a variety of sources including General Stanley McChrystal’s book, “Team of Teams,” which entails a process of employing many small specialized teams to tackle large complicated issues. Hiring teams of individuals in unison to accomplish a goal is not new to many businesses. When college football teams change head coaches, for example, an entire staff of ancillary/associate coaches may accompany the new coach. Thus, a new team is hired.

In other cases, a team of individuals is assembled one at a time. For example, I have a friend in the advertising business who has worked as part of a team which was assembled over the years and hired by different agencies to provide writing and graphic design services. The individuals that make up this advertising team were hired one at a time as the agency grew. In music, there are many famous teams of song writers. In the corporate world, companies purchase other businesses and acquire teams to add a service or function they do not currently possess or offer. Think of Google’s acquisition of Android, Nest, Waze, and YouTube

Hiring teams can also occur via outsourcing. Or as I prefer to call it, by securing a “team partner.” Groups seek out organizations to partner with that specialize in ready-built teams in their respective industry, rather than build a team from scratch.

Outsourcing has at times received a negative reputation. Many business leaders question outsourcing anything. However, health care is morphing and changing daily. If a leader does not take the time to assess opportunities or approaches outside their organization’s usual way of thinking, maintaining the status quo could become detrimental and costly. It is perfectly normal, and oftentimes most beneficial, to ask for help in finding and hiring teams from an industry expert.

Why should an ASC consider hiring a team partner?

  1. Locate and tap into existing expertise. Hiring an industry team partner allows an ASC to quickly access qualified candidates with a history of success. While past success is not a sure sign of future success, it is a much better indicator than no past experience or a history of no success. While there are no guarantees a new internal team will succeed, the proven track record of a team partner is generally worth the price – both in dollars and time.
  2. Time is of the essence. You will rarely hear an organization say, “There are no time constraints to launch this project or fix this issue.” While building expertise from within, or tapping into internal resources may seem safe, it typically isn’t expeditious in our fast-paced health care environment. Learning takes time. Becoming an expert takes even more time. Often, learning on the job is not a luxury we possess. A team partner allows for immediate impact.
  3. No team bonding needed. High performing teams have a proven track record of working extremely well together. New teams, on the other hand, need time to create chemistry and build trust. Selecting experienced individuals with the proper skill-set and culture, then creating a team to elicit results and meet expectations is time consuming. Consider hiring an ASC team partner to access established teams. Bringing on an established team provides more timely dividends.
  4. Internal change is difficult. If change was easy, there would not be a multi-billion dollar industry built around helping individuals or organizations with their change management efforts. Many organizations will hire a single individual or even multiple individuals to create a new service offering. Within a few months or a year, those individuals may begin to think and act like everyone else leaving their original goals unaccomplished. Team partnering allows an organization to tap into an alternative corporate culture to advance a new initiative or gain buy-in to a critical mindset change.
  5. Acquire the crossover effect. Organizations experience a period of plasticity in their identity when there is a large influx of new employees. This period of change is known as the crossover effect. The crossover effect can be viewed as positive disruption. The spread of new ideas and new ways of working bring new life to the host organization. Often a newly hired team can affect other, more established teams within the organization via positive disruption.

Business owners and leaders are all striving for gains and improvement in the performance of their people and organizations. In many cases, changing our perceptions, practices, and personnel will be required to achieve those gains. Thoughtfully consider if hiring team partners might help your ASC acquire the individuals needed to facilitate some of those changes in the most expeditious, beneficial manner possible.

Robert Carrera, President/CEO

How ASC Data Analytics Can Benefit Your Facility: Part 2 of 3

How ASC Data Analytics Can Benefit Your Facility: Part 2 of 3

By ASC Management No Comments

(Part 1 introduces the topic as it applies to ASCs, Part 2 provides examples of how analytics can be beneficial in the ASC arena, and Part 3 will walk through the evaluation process to determine when analytics is a good fit for an organization)

In this second installment of our ASC data analytics blog, we will examine specific ways an analytics program can benefit an ASC. While not every type of report mentioned here may be applicable or beneficial to every facility, the following examples will provide a broad base for understanding the potential benefits an ASC analytics program can provide.

ASC Data Analytics Report #1: Case Cost Analysis

The first category of essential ASC data analytics is case cost analysis. Simply put, case cost analysis determines the cost to complete an individual case. With this number determined, the cost of a case can be subtracted from the revenue generated by that case to obtain the associated profit (or loss). Though determining the profit/loss margin of a single case rarely tells a complete story, logically grouping cases into different “pools” can begin to reveal performance of different segments within an ASC. Grouping cases by procedure type, specialty, surgeon, or payor can reveal performance trends.

Although most ASCs likely know their cost per case at a high level already – total operating expenses divided by number of cases – the true value of adding a formal analytics component comes from the ability to drill down into the data. Going beneath the surface allows ASC leadership to identify specific, meaningful areas of concern that can be improved upon to enhance the overall performance of the facility.

Components of a Case Cost Analysis: Supply Cost

An analytics-led case costing report is driven by details. Our initial definition of case cost analysis mentioned “determining the cost to complete an individual case.” Merely examining the expenses identified on an income statement or general ledger will reveal facility-wide trends. However, that will not stratify the data to provide the level of detail needed to make a valid comparison between case types (the “pools” we noted previously). For example, a basic pain procedure shouldn’t be assigned the same case cost as a complex orthopaedic procedure. For true case costing insight, expenses need to be directly tied to individual cases.

To obtain specificity in a case cost analysis, one would typically rely on the ASC’s inventory management system to determine the per-case supply cost. Reviewing surgeon preference cards by procedure type may also be used if the inventory management process at a facility lacks per-case specificity. This should provide an accurate accounting of the various supplies used for each procedure, as well as, the total supply cost per case. Supply cost differences between surgeons or procedure types are immensely important in providing analysis points when reviewing differences in total profitability later in the process.

Components of a Case Cost Analysis: Staff Cost

In addition to supplies, staff time is an important consideration in detailed case cost analysis. Most facilities use a case log to track time individual staff members spend on a specific case. By totaling individual employee costs associated with the episode of care, direct staff cost per case can be identified.

Components of a Case Cost Analysis: Overhead Allocation

While supplies and staffing make up most of the direct costs for a case, facilities should also assess the impact overhead expenses have on their overall profitability. Overhead allocation can also be completed at the case level. This can be done by determining the total amount of fixed costs for a given period and assigning a portion of these costs to each case. Some facilities may choose to assign an equal overhead value for each case. Other facilities may choose to allocate overhead based on a formula representing the relative utilization of a fixed expense (e.g. allocation of overhead based on OR time, total case time, etc.). Using this methodology, a complex orthopaedic case is assigned a higher overhead expense per case than a quick pain procedure. This makes sense when one considers that an orthopaedic case uses relatively more of the rent, utilities, etc., than a pain case. When an ASC desires to understand the true total costs of each of their cases, providing a logical overhead value assignment is a necessary component.

For most facilities, it isn’t possible to track every staff minute and supply back to every patient with 100% accuracy. Typically, the total direct costs (supplies, staff) that can be tied back to an individual case are lower than the direct costs shown on an income statement. The difference in the two amounts is the unallocated variable expense. Unallocated variable expenses often arise from the aggregation of small expenses (pens, tissues, hand soap, etc.) that are difficult to track and attribute to individual cases. These expenses can be distributed on the case level using the same methodology as the overhead distribution.

Interpreting the Case Cost Data

At this point, all the expenses for the facility – clinical supplies, staff, overhead, and unallocated variable expenses – are now linked back to individual cases. Instead of one generic cost per case, each case has its own unique, true cost. When the costs per case are subtracted from the revenue generated by each case, the actual profitability of that case is revealed.

All this data can be sorted, grouped, and filtered in a myriad of ways. With each new view of the data, analytical insights begin to jump off the page.

Cases previously thought to be highly profitably may prove the opposite due to high supply, staff, or overhead costs. Physicians who have been historically viewed as producers of low revenue per case may actually be contributing significantly to the facility’s profit due to lower-than-expected expenses. Entire specialties and payors may be viewed in a new light. The data may reveal that improvement in just a few key procedure types could have a dramatic impact on the overall profitability of a center. The list of potential findings is limitless.

ASC Data Analytics Report #2: Facility Financial Analysis

An ASC data analytics program should be able to provide a routine, comprehensive analysis of a facility’s financial performance. This should include not only reporting current financial metrics, but also comparisons to the same period during the previous year(s), the most recent periods (often called “trailing reports”), and to ASC-specific regional and national benchmarks.

Often, the facility financial analysis can be tied to case cost data. Case cost data can be reported in a combined suite of reports (a dashboard) that provides quick insight into the ASC’s performance. For example, a decrease in overall facility profit may be identified as the result of an increase in lower-profit types of procedures over the same period. Likewise, a decrease in revenue per case but an increase in total ASC profitability – which could be perplexing – may be identified as an increase in procedures with low revenue per case (which dilute the overall facility revenue per case) but a strong profit margin. Adding a data analytics component to standard ASC financial analysis should increase awareness and understanding of the factors influencing an ASC’s financial performance.

ASC Data Analytics Report #3: Clinical Analysis

Adding an ASC data analytics program can also provide benefits to clinical efficiency and patient safety efforts. Case time log data can help paint a picture of efficiency within the OR, as well as provide a workflow analysis of the activities in registration, pre-op, and PACU. An example is a block-utilization report, which details how well a specific surgeon or specialty fills their allotted OR block time. Identifying trends and tweaking block time allocation as necessary can lead to a more efficient, profitable center.

Patient safety data can be gleaned to identify trends that can prevent a bad outcome before it happens. Staffing data is a wonderful resource an analytics program can use to ensure optimal levels of staffing are being utilized. Medication log data is another database that can be tapped into to add to the clinical safety reporting tapestry. For example, analysis of the medication log data may reveal cases where drugs are being prescribed at different stages in the delivery of care that may create unsafe conditions, such as hazardous drug interactions or over-prescription of narcotics. A dedicated analytics program should be able to drive facility profitability, efficiency, and patient safety through enhanced analysis and amalgamation of clinical data.

Investing in an ASC Data Analytics Program

Attaining highly detailed case cost, financial, and clinical efficiency/patient safety insights is a lot of work. Parsing out valuable insights from scattered databases, case logs, and financial reports requires a specialized skillset and experience tailored to the ASC setting for maximum return on investment. The available data often needs to be “scrubbed” (a time-consuming process) to avoid the dreaded “garbage in-garbage out” phenomenon.

As discussed in Part 1 of this series, dedicated analytics programs and personnel are not currently common in many ASCs. Committing the resources necessary to obtain a quality ASC data analytics program must be carefully weighed against the potential benefits. The next part of this series will discuss strategies to help make this determination. As the ASC industry becomes more competitive and pressures from payors continue to rise, the decision to invest in an analytics program is increasingly becoming the correct choice for many ASCs.

Cody Carlin, Director of Data Analytics

Implementing a Patient Texting Program at Your ASC

Implementing a Patient Texting Program at Your ASC

By ASC Development, ASC Management No Comments

Over the last two decades, texting has grown into one of the world’s most effective and accessible communication methods. However, there are still some professional service sectors where more traditional communication (e.g. phone, mail) is more common. It may be surprising to know that some health care entities are beginning to offer patient texting programs, sending important reminders to patients. For those in the ASC industry, this is an exciting opportunity to demonstrate to patients you care about modernizing and updating their delivery of care as well as your interactions with them. Is your ASC poised to take advantage of this chance to show you provide the best and most convenient options?

Here are a few interesting statistics about smartphone and text messaging use:

  • Ninety-five percent of Americans own a cellphone of some kind.[1]
  • Texting is the most widely used smartphone feature, with 97% of Americans using it at least once a day.[2]
  • Ninety percent of all text messages are read within three minutes of their delivery.[3]
  • It takes the average person 90 seconds to respond to a text message.[4]
  • Texting is for everyone. Ninety-four percent of smartphone users 70 and older use text messaging on a weekly basis.[5]

Statistics like these helped inspire our ASC to implement a patient texting program in November 2017. Before launching the program, many of our patients were receptive to the idea of receiving text messages from our ASC. As part of our program, patients are asked if they want to receive text messages from us when providing their medical history through our online portal. An average of about 80 percent of our patients opt in.

We hoped that by leveraging the power of texting, we could improve the experience of our patients and staff.

Developing the Texting Program

Our texting program is managed through an online patient portal vendor. Working with this company, we customized a series of automatic text messages which are sent to patients preoperatively and on the day of surgery. We carefully crafted our messaging and determined the most appropriate time for message transmissions. This “automated clinical pathway” provides instructions and prompts patients to complete important steps in their procedure preparation. Personal health information is never transmitted to maintain HIPAA compliance.

Here is a summary of our text messages:

Two days before surgery, morning. Our first message asks patients to confirm the date and time of their procedure.

If patients are unable to make their appointment, the message advises patients how to reschedule.

If patients confirm their appointment, they receive another automated message reminding them to review their physician’s preoperative instructions.

Two days before surgery, evening. This message provides instructions about what patients need to bring with them on their day of surgery. We also remind them to bring a method of payment and ensure they arrange for transportation.

Day after surgery, morning. Our final automated message thanks patients for allowing our ASC to provide care during their surgery. It also expresses our hope that they are recovering well. If there is a problem with their recovery, the text message instructs patients to call the ASC and ask to speak to a nurse.

Note: Patients can opt out of receiving texts from the ASC at any time. For patients who choose to do so, and those who do not opt in to receiving texts when providing their medical history, we communicate via phone and/or email.

Texting Program Benefits

Due to the widespread use of text messaging, patient texting programs are primed for success. During the first three months of this program at our ASC (November 2017-January 2018), all patients who opted to receive text messages responded to the automated messages. Most confirmed their appointment through the text message; the remaining called the ASC.

Here are some of the tangible improvements your ASC may experience after implementing an ASC patient texting program:

  • Decrease in number and duration of nurse calls to patients (savings of about 10 minutes per call)
  • Decrease in staff hours per case
  • Increase in staff efficiency and satisfaction
  • Increase in patient compliance with physician and ASC instructions
  • Decrease in patient no-shows and cancellations
  • Increase in patients paying for care prior to day of surgery (an unexpected benefit)

Growing the Patient Texting Program

After experiencing the success of a patient texting program, ASCs may consider exploring ways to expand the use of texting. One idea is to incorporate front office staff into the patient texting program. For example, after verifying benefits, front office staff may choose to send an automated text message to patients. The message could indicate patient financial responsibility after verified insurance deductions, and prompt the patient to arrange for payment.

Another solution is sending a one-time text message to patients. This would come in handy if, for example, there was a significant snow storm or catastrophic event and the ASC needed to close. The ASC could send a text to all affected patients on the surgical schedule.

One other area to grow a patient texting program is sending text updates to family members in the waiting area. These would provide an update on the status of loved ones in surgery.

The Importance of a Patient Texting Program

An ASC patient texting program demonstrates to patients your ASC cares about consistently modernizing and updating your health care services with a focus on what works best for patients. This is a powerful message to send to your customers in the ASC industry. Studies show 64 percent of consumers prefer texting versus a phone call for customer service needs and 77 percent of consumers are likely to have a positive perception of companies that use text messaging.[6] In the ever-changing health care market, texting is expected to become an even more valuable communication tool going forward. You can bookmark this as a 2018 ASC industry trend.

Michaela Halcomb, Director of Operations







Simple, Effective Ways to Boost ASC Staff Satisfaction

Simple, Effective Ways to Boost ASC Staff Satisfaction

By ASC Management, Leadership No Comments

There is no denying the importance of staff satisfaction in an ASC. When staff are content with their jobs, the positivity permeates throughout the facility. Patients and their families notice. Physicians enjoy coming to the center more and overall care improves.

In a busy ASC, managers may find it challenging to plan activities intended to help boost staff satisfaction. Although it is often difficult to make the time, such activities are critical. And, once you commit to them, they should occur regularly. If you employ good staff, you can be sure other organizations would love to hire them away from you. The moment staff morale starts to dip, the door begins to open for your competition.

ASC administrators and managers who want to boost staff morale have many employee engagement options. Two staff-focused activities commonly implemented at ASCs and other health care facilities designed to improve staff satisfaction and retention are outlined below. They are fun, inexpensive, and easy to administer.

Staff Satisfaction Booster #1: Monthly Birthday Celebrations

Most people enjoy celebrating their birthday with others. That’s why birthday celebrations are an excellent opportunity to show appreciation for staff members. They present an opportunity for ASC staff to gather during work hours, have some fun, and receive a treat.

In a very small ASC, it might be possible to celebrate everyone’s birthday individually. As an ASC grows, that becomes more difficult. For a staff of 50, a birthday celebration could occur every week. This adds up to a lot of time . . . and a lot of cake! Additionally, the celebrations may quickly lose their luster if conducted too frequently. One solution is monthly birthday celebrations.

Once a month, around the same time each month, celebrate the birthday of everyone born that month. Buy a large enough birthday cake to provide all team members with a piece. During the lunch hour, available staff come together in the break room. Anyone with a birthday that month is recognized.

By taking this approach, no birthdays are missed. It doesn’t matter if someone’s birthday falls on a weekend or holiday. During monthly celebrations, everyone is acknowledged equally. With a month between celebrations, excitement builds over the get-together and, of course, free cake.

Staff Satisfaction Booster #2: High-Five Appreciation Program

High-fives between people are a way of acknowledging a job well done. That’s the objective of the high-five appreciation program. Rather than staff giving each other physical high-fives (which they can still do), these high-fives are written and recorded.

The materials needed to launch this program are a bulletin board, thumbtacks, paper, pencil, and scissors. Trace hand figures on paper and cut them out. I recommend streamlining the process by cutting multiple sheets at a time. Repeat this process until you have a large stack of paper hands.

When staff members see another team member doing something they feel is worthy of a high-five, they make a note of the outstanding action on a paper hand and then tack the hand to the bulletin board. Items written on the hand include:

  • recognized staff member’s name;
  • date of the observed activity; and
  • description of the staff member’s action.

Recognized actions should be specific – notable behaviors or achievements that go beyond a person’s job responsibilities or something someone does well consistently.

If staff are actively participating in the program, a good number of hands will be posted to your bulletin board after about a month. Each month, take the hands down, review them, and pick out a few that stand out as exceptional. Bring staff together to acknowledge the great work recognized during the previous month. When is a good time to do this? How about during the monthly birthday celebration?

After singing happy birthday and handing out cake, read the high-fives that you selected. If your budget permits, providing a small gift to these “winners” can be a nice bonus. Take time to hand out all the high-fives to the staff members acknowledged on them. The simple recognition of a job well done – with or without a gift – is sure to bring smiles to the faces of your team.

Note: There may be value in including high-fives in your staff evaluation process. Before distributing the high-fives, note the acknowledged action(s) in staff personnel files.

Keys to Success

While these activities are easy to implement and sustain, they have a profound effect on staff morale – particularly the high-five program.

To ensure your high-five program is successful, take these steps:

  • Educate staff. At an all-staff meeting, explain how the program works and why you are doing it. Build some excitement.
  • Task your managers with ensuring their departments fill out at least a few hands during the first several months. Regular encouragement by managers to team members during department meetings should help do the trick.
  • Actively promote the program. If your high-five celebration happens on a Thursday, send an email to staff on Monday or Tuesday. Remind staff that the celebration is in a few days and encourage them to submit their high-fives. This will help nudge anyone thinking about completing a high-five to get it done before the celebration.
  • Review the high-fives. If you find people are submitting high-fives that are not representative of the types of actions you want to acknowledge, remind staff about the “rules” and objectives.
  • Seek feedback. Not every staff member will want to be recognized in the same fashion. Take time to seek feedback from staff or your managers on how people feel about the program and being recognized. For example, some individuals would rather you send them a personal note than to be publicly recognized. Tailoring your recognitions will go a long way with your staff.

For the monthly birthday celebrations, the most important step is to ensure the events happen every month, without fail. Once you announce the monthly celebrations, most of your team will look forward to their celebration month. If you stop the celebrations before completing 12 months, you are likely to disappoint staff members who were never in the spotlight.

Consistency is critical for the high-five celebrations as well. By putting in the time and effort, and maintaining the excitement surrounding these activities, your ASC will establish valuable ways to boost staff satisfaction.

Jebby Mathew, Regional Director of Operations