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5 Ways to Boost Profits at Cash-Strapped ASCs

5 Ways to Boost Profits at Cash-Strapped ASCs

Here are five recommendations from industry experts on ways to boost ambulatory surgery center profits, even amid tightening budgets and decreased reimbursements.

1. Create positive relationships with commercial payors

Through building long-term relationships with your payors, and you will find it easier to get reimbursements increases in difficult years, said Reed Martin chief operating officer for Surgical Management Professionals.

“It works best when we have personal relationships with the medical director and the negotiators at insurance companies, on a regional and national basis,” he says. “In the past, it has been important for me to be on a first-name basis with the negotiator and medical director for the major payors.”

This type of familiarity sets the tone when you’re negotiating and makes the interaction more friendly and honest and less combative. ASC leaders can develop strong relationships by making themselves available as resources in the industry. “Payors have issues where they need to understand what’s happening with [accountable care organizations], or the movement of neuro and spine into ASCs,” he said. “It should be a two-way street.”

2. Be aggressive with claim denials

Lisa Rock, president of National Medical Billing Services recommends ASCs review all electronic claim rejection reports daily so that they can determine where in the pathway the claim was rejected. Rejected claims could lead to great revenue losses.

Reviewing reports will allow billers to determine if the cause for the rejection was in-house or with a certain clearinghouse and trading partner. For example, reviewing the report would allow a biller to see that a claim was rejected due to an error by the provider’s billing team rather than along the pathway. If errors are made along the pathway, reviewing the report will highlight where the claim failed to move forward.

“Maybe a claim was rejected because of an ID error by your receptionist, but if you don’t read the rejection report, you don’t know that it was rejected out of the first stage. It didn’t even make it out of the gate,” Ms. Rock said.

If errors were indeed introduced by the provider’s staff, billing managers should work to improve processes and reduce in-house errors. If errors appear elsewhere along the pathway, billing managers should determine why the claims were rejected at that point and call the clearinghouse or trading partner to investigate further, if necessary.

3. Standardize hiring and cross-train employees

Spend more time hiring the right people because hiring and training new employees is costly overall, said Paul Skowron, senior vice president of operations for Regent Surgical Health. A center will spend less retaining an existing employee than bringing on a new one.

When searching for the right fit, revise all job descriptions so that they accurately describe the position you’re looking to fill. If a certain skill is required for the position, make sure to list it to cut down the number of unqualified candidates who apply. He recommends cross-training employees so they can work in multiple areas of the surgery center; for example, a surgical tech might perform materials management functions to cut down on staffing costs.

4. Break costs down to the pennies

The path to becoming and staying profitable starts with a mindset change, said Blayne Rush, MHP, MBA, president of Ambulatory Alliances. Many surgery center officials do not realize they should be counting the smallest costs since seemingly insignificant savings add up quickly. He recommends going through every cost and every dollar spent to figure out where profits can be extracted.

“It’s not just big-ticket items,” Mr. Rush said. “Pennies add up to dollars and add up to thousands of dollars over time. People don’t break it down to the ridiculous, all the way down to the pennies. You add that over time and you find 10 of those and you end up saving $20,000 a year.”

For example, many supply costs can be trimmed if the surgery center purchases less expensive versions of supplies. Even physicians who are accustomed to using a specific supply type or brand are usually happy to switch to a more cost-effective alternative if shown the exact cost savings of making the change.

5. Cater to surgeons’ desires

To be optimally profitable as an ASC, administrators must keep physicians satisfied so they will continue to bring cases to the facility. Sandy Berreth, RN, MS, CASC, is the administrator of Brainerd Lakes Surgery Center in Baxter, Minn., and a surveyor for AAAHC. She said she has three types of customers. Her most important customers are the physicians, then her surgery center staff members and then the patients.

“If I take care of the first customer, the surgeon, they will bring patients,” she said. “If I take care of the second customer, the staff, they will give great care. The third customer, the patient, already has the physician they want; and it is my job to keep the physicians and staff doing great things and then the patients will say great things about the surgery center.”

Ms. Berreth said her experience has also shown her that physicians will be happiest and most loyal to a surgery center if they are given three particular perks — extra time, a quality staff and great food.

Ref. Becker’s Healthcare

This post was first published February 12, 2013 and was updated July 29, 2020.