While Hospital Outpatient Department (HOPD) Ambulatory Surgery Centers command higher rates than freestanding Ambulatory Surgery Centers (ASCs), hospital systems are increasingly interested in the transition. Why? Though reimbursements for HOPDs remain relatively high for hospitals, the rest of the landscape is changing quickly. From payor policy changes that direct cases out of the hospital setting, strengthening partnerships with non-employed surgeons through equity offerings in an ASC, to elevating the patient experience, ASCs offer significant long-term strategic advantages to hospitals.
Here, we’ll explore those advantages and why it’s time to convert your HOPD to an ASC.
Patients and Payors Prefer ASCs to HOPDs
Patients and payors alike increasingly prefer ASCs to traditional hospital-based settings. The cost of procedures in ASCs are significantly lower. For example, the average cash price for hip arthroscopy in an HOPD stands around $9,844. At an ASC, the same operation costs just $5,871 on average.
Additionally, prices tend to be more transparent at ASCs. While transparency is increasing at hospitals per CMS, a survey of 2,000 hospitals revealed that only a quarter of these comply with those regulations.
Overall, moving both complex and less complex outpatient appropriate procedures from main ORs and HOPD to freestanding ASCs can reduce costs to payors and patients by nearly 60% per procedure according to UnitedHealth.
Establishing an ASC doesn’t guarantee that payors and patients will automatically come to you. An ASC consultant can help your organization strengthen its referral network and develop a marketing strategy to ensure that your operation is sustainable.
ASCs are Talent Magnets
According to the AMA, the healthcare industry could have a shortage of as many as 30,000 surgeons in the next decade. ASCs stand out as a talent magnet. Healthcare systems that can adapt to the new healthcare hiring landscape and convert their HOPDS stand to gain the most.
ASCs may give surgeons the potential to own equity in their workplace, with greater control over their schedule, and with improved efficiency versus practicing at a hospital. This allows surgeons to increase their earnings and attain a better work-life balance, naturally increasing an ASC’s ability to attract top talent in a strained market.
“Creating ASCs from HOPDs allows for hospitals to deepen relationships with community surgeons which can help drive the system’s larger strategy,” explains Robert Eisenberg, RN, MBA, CASC. Vice President, Ambulatory Surgery Lead for Sullivan Healthcare Consulting.
While ASCs are magnets for surgeons and anesthesiologists, they must also have dependable nursing and administrative staff. Understanding the full staffing picture of ASCs is critical for running a smooth operation. An ASC consultant can help determine how many staff members in each specialty will be necessary for building and maintaining a culture of success.
ASCs Stand to Gain From the Migration to Outpatient Procedures
As medical technology, anesthesia protocols, and new medications become increasingly safe and minimally invasive, they require fewer of the support and recovery services that previously made it necessary to operate in an HOPD. This enables more procedures to take place in the ASC setting.
This is currently taking shape as the inpatient-only reimbursement list slowly shrinks. Most notably, orthopedic operations are increasingly common in the ASC setting. According to Research and Markets, an estimated 68% of orthopedic procedures will be performed in ASCs within the next two years. Health systems that don’t transition from HOPD to ASCs will see procedures drop. However, systems that make the conversion stand to gain.
“Our clients are benefiting greatly from case migration from the HOPD to the ASC setting. Planning and navigating a successful case migration strategy takes experience and the right tools,” adds Eisenberg.
Moving Procedures From Inpatient to Outpatient Boosts Profit Margins
In addition to capturing a greater number of procedures, health systems that operate a health plan can directly increase their profit margins by lowering the cost of care. Each time a health system is able to move a procedure to the ASC setting, it can expect to improve profit margins further. Still, it’s essential to engage consultants with a track record of negotiating favorable contracts with providers and payors.
Sullivan Healthcare Consultants are Your Guides to Sustainability
While converting your HOPD to an ASC brings myriad benefits to all stakeholders, the actual conversion process is fraught with nuance. Small missteps can derail your project, compromise surgeon trust, or risk noncompliance. If your organization wants to make the transition from an HOPD to an ASC, it’s a major risk to navigate the conversion alone. To make the transition with confidence, turn to Sullivan Healthcare Consulting.
Our consultants guide you through each step of the HOPD-to-ASC conversion, from financial management and billing to staffing and regulatory compliance. Ultimately, we’re dedicated to giving your ASC the foundation it needs to thrive, not just survive.
Take the first steps toward surgery center sustainability — contact Sullivan Healthcare Consulting today.