Owning a medical practice generates significant income for many physicians. Along those lines, a growing number of physicians are opting for sole ownership of an ambulatory surgery center (ASC), which provides surgery, diagnostic services, and preventative interventions.
According to the Advancing Surgical Care Association (ASCA), ASCs provide surgical interventions for a number of specialties, from gallbladder to small-joint to cataract. ASCs offer an alternative to hospitals for services like outpatient surgeries, while providing top-tier care. Based on the ASCA’s data, the five best-performing Medicare-certified ASCs focus on orthopedics, pain, ophthalmology, endoscopy, and plastic surgery.
With their ability to provide a smaller list of specialized surgeries, ASCs can provide a more efficient alternative to hospitals. For example, specialization requires only purchasing necessary equipment, which results in lower costs. ASCs also require less space due to specialization. Furthermore, the narrower focus of ASCs yields higher quality control.
Ambulatory Surgery Centers Benefit Healthcare Industry Cost Control
As an alternative to hospitals, ASCs provide numerous advantages, including greater productivity and efficiency. According to a review in the Journal of Spine Surgery, ASCs aid in healthcare industry cost control, as they are less expensive than hospital outpatient centers. As a result, ASCs lower costs while not compromising care quality. For example, while cataract surgery may cost $490 at a hospital, it could cost around $193 at an ASC. Physicians who own ASCs get to keep a greater percentage of the profits, leading to an increase in revenue. Authors of the review note that the overall cost of performing surgery at an ASC is between 53% and 55% lower than it is in a hospital. This is especially beneficial given the ongoing decline of professional fee reimbursement over recent decades.
Review authors tout other ASC benefits, like their significantly smaller size when compared to hospitals, which results in reduced red tape due to a less robust hierarchy. Smaller size allows them to concentrate on achieving steady management goals and efficiently merging provider incentives with manager/owner desires. Though physicians, hospitals, and management companies are usually the main stakeholders, a number of ownership models are possible. That said, 90% of ASCs in the United States have a certain level of physician ownership, and sole-physician ownership comprises 65%.
However, regulatory and administrative issues mean that owning an ASC is not without its complexities. For instance, ownership mandates that physicians comply with Stark Laws. Sole-ownership also requires that physicians handle day-today operations, while performing at least one-third of the ASC’s procedures. Contracting with insurers may also present a challenge. Dr. Naveed Saleh, MD, MS suggests that sole physician owners hire a management service while maintaining equity. Though the cost may be between 3% and 7% of the ASCs net revenues, it will ultimately create a more profitable ASC.