7 Trends and Opportunities for Ophthalmology in Surgery Centers

1. Increasing volumes as the population ages. ASCs can expect an increase in demand for ophthalmic surgical procedures as Baby Boomers begin to age, says Richard Lee, MD, an ophthalmologist at Eastbay Eye Specialists in Oakland, Calif., who performs cases at EyeMD Laser and Surgery Center, also in Oakland, and is a member of the American Academy of Ophthalmology.

“The number of Medicare patients is expected to double in number over the next two decades as Baby Boomers begin to age, which will keep ophthalmology very busy,” says Dr. Lee. “Surgical volumes [for ophthalmology] are expected to increase 30-50 percent over those years.”

2. Continued focus on efficiency. ASCs that continue to focus on efficiency should experience continued success, say several ophthalmologists.

“Improving efficiencies and an increased focus on cost containment will allow ASCs to keep up with pressures of continued reduced reimbursements,” says Cary Silverman, MD, an ophthalmologist at River Drive Surgery Center in Elmwood Park, N.J.

ASCs’ costs are traditionally lower than hospitals for ophthalmology cases, and the savings ASCs offer should continue to bring eye cases to ASCs.

“The average facility fee at an ASC is $1000-$1,100, with hospital fees running up to three times as much in some cases, says Dr. Lee.

3. Growing case loads slowly. Even adding only one additional case per day can have a big impact on profitability.

Dr. Lee says his ASC worked to add an additional case per day for subsequent years, allowing volumes to grow slowly.

“There is this pressure to attract only the best and the fastest physicians for an ASC, and that’s fine until you run out of doctors,” says Dr. Lee. “You don’t need to do that. As you become more efficient, adding one more case a day can build your volumes over time.”|

Because of the principle of marginal costs, Dr. Lee’s ASC was able to generate a 60 percent increase in profitability from just a 16 percent increase in surgical volume in 2009, he says.

4. Multi-focal implants with cataract procedures. Physicians can offer improved patient outcomes and increase ASC revenue by offering patients a high-end muti-focal implant while undergoing cataract surgery, says Peter Colquhoun, MD, an ophthalmologist at Southwest Michigan Eye Center in Battle Creek, Mich., and a physician-owner of Brookside Surgery Center, also in Battle Creek.

Although the price of lens implants are bundled into payments for cataract surgery, if a physician and patient select a higher-end multi-focal implant, such Alcon’s ReStor IOL or Abbott’s ReZoom IOL, ASCs, at least in Michigan, can balance bill a patient for the additional cost of the lens, says Dr. Colquhoun. Balancing billing allows for cataract patients, who are often covered by Medicare, to receive the highest-level technology — a technology that Medicare would otherwise deny, he says.

5. Retinal procedures. While cataract surgery remains the most poplar ophthalmic procedure within the ASC setting, expanding to retinal procedures, such as pars plana vitrectomy, can be profitable if centers are willing to invest in the equipment needed to perform these cases. Shorter procedure times and less-invasive techniques have made retinal procedures now appropriate for the ASC setting.

“There is a long history of the ASC being mainly relegated to cataract surgery, with retina surgery traditionally being done in hospitals,” says Pravin Dugel, MD, an ophthalmologist at Retinal Consultants of Arizona in Phoenix who performs cases at Spectra Eye Institute in Sun City, Ariz., and member of the AAO. “Changes in instrumentation and reimbursement have made retinal procedures applicable for the ASC-setting, and that’s where growth [for ASCs] lies.”

Equipping an ASC for retinal procedures may cost as much as $200,000-$400,000, but can be “fantastic investment” if the physicians are committed and dedicated to the program, says Dr. Dugel.

6. Glaucoma procedures. Glaucoma procedures may also be a way for ophthalmology service lines to expand their offering and attract more cases.

Dr. David Kwiat, MD, FACS, an ophthalmologist at Kwiat Eye and Laser surgery who practices at Fulton County Ambulatory Surgery Center in Johnstown, N.Y., says his ASC is focusing on adding glaucoma procedures such as cyclophotocoagulation.

“For an ASC like ours that focus mainly on anterior segment surgery, adding glaucoma procedures should prove beneficial,” says Dr. Kwiat. “The patient benefits as well with a less invasive glaucoma treatment option and less postoperative difficulties.”

Dr. Colquhoun says his practice is considering recruiting a glaucoma specialist in the coming year, who could then perform some procedures such as implantations of mini shunts to treat glaucoma, at the ASC.

7. Oculoplastics. Although the volume of plastic surgery has dropped dramatically with the economy, Dr. Colquhoun expects some of that business to rebound in 2010. “With the economy improving in the next year, we are hoping lid corrections and other elective ophthalmic procedures, such as LASIK, will increase,” he says.

New York’s Vassar Brothers Medical Center Plans Expansion

Vassar Brothers Medical Center in Poughkeepsie, N.Y., has proposed a $66 million expansion project that includes the construction of an ambulatory surgery center, according to the Poughkeepsie Journal.

Officials from the hospital announced the plans last year as part of an effort to reduce crowding and improve parking at the hospital, according to the report.

VBMC has proposed a 78,000 square-foot medical complex that would include an ASC as part of the project, according to the report. Other additions include an 850-space parking garage and a cafeteria.

If approved by the board, construction could begin this summer and completed by the end of 2011.

Read the Journal’s report about Vassar Brothers Medical Center.

Growing Your ASC: Q&A With Robert Zasa of ASD Management

Q: Solid business fundamentals are essential to the success of ASCs. What can centers do to ensure their processes are running as effectively and efficiently as possible?

Robert Zasa: Case costing remains as important as ever. At our centers, we are currently running some spring housekeeping to see where we can reduce items we buy. For example, we may see a reduction in reimbursement from HMOs when it comes to surgical implants. In this case, we go back to the payor and try to renegotiate rates. We will be honest with the payors and explain that we can’t afford to do the cases at the current rates, which will, in turn, force them to go back to the hospitals and pay a higher rate. Often, we will be able to negotiate a new rate.

Aside from reviewing case costs and reimbursement rates, we look at all areas of the practice, including staffing costs, suppliers, etc., to see what we can do to get better pricing. Recently, we’ve been able to work with our GPO to contract for more items on more of discount. We’ve also shopped distributors to see if we can get better pricing. Overall, though, staffing and supplies account for the biggest variable costs in an ASC, and we make sure we are reviewing these areas.

Q: ASCs continue to have concerns over falling reimbursements, as they have in the past. How can ASCs make sure that they are receiving adequate reimbursement on their cases and what should be done to improve these rates?

RZ: As with case costing, ASCs should review their reimbursements per case. At our centers, we review one specialty every month so that it becomes a routine practice. We also perform a retroactive contract analysis of the top 20 or so procedures at our ASCs by CPT code. The top 20 codes will typically represent 80 percent of your business at your ASC.

Using these codes, we perform a payor breakdown, including case volume per payor, so we can track any disparities among the rates. You want to make sure you have a good sense of what you are doing per payor.

For example, you might discover you are doing 200 cases for Cigna at $100 and 300 for Blue Cross at $50. This way you can see what insurers are more profitable for your center and which ones it may be necessary to renegotiate with.

ASCs should also receive annual notification of changes in reimbursement from payors, so that they can prepare for significant changes.

Q: What opportunities for growth exist for ASCs currently? Are there any new developments or procedures beneficial to service lines in ASCs?

RZ: One opportunity we’ve taken is to go back to our existing physicians to make sure that they are maximizing the use of the center. We have also examined CMS’s list of newly approved procedures for ASCs and ask our physicians what they are willing to or want to learn. For example, we had a general surgeon say he was interested in learning new endoscopic procedures. We already had the equipment for other specialties, so it was worthwhile to have the surgeon train on the new techniques and add them to the ASC. Keeping constant communication open with your investors will help you to gauge the interest of your surgeons.

Spine and retina also remain popular new areas for growth, and, again, we add these specialties according to physician interest. Retina is now paid by Medicare, so it can be a profitable addition for ASCs. We’ve had outside surgeons from other ASCs come in and demo these areas for our surgeons, and if there is interest we look into adding the procedure.

Q: Reports have shown that more new physicians are choosing the hospital setting over private practice. How can this effect the ability of ASCs to recruit new physicians?

RZ: Hospital employment can be good for ASCs that are in joint ventures with hospitals as it means new physicians will continuously be added on to the center. ASCs can also benefit in entering into joint ventures with hospitals, as the recruiting office will see the surgery center as key to attracting new surgeons. For instance, a hospital may be attracted to a new orthopedic surgeon, and the ASC can help bring the surgeon in because it can offer a place where he or she can work and have ownership.

Mr. Zasa is a managing and founding partner of ASD Management, which specializes in development and management of new and existing ASCs. Learn more about ASD Management.

Survey of Nurses’ Upcoming Plans Suggests Nursing Shortage Will Return

A recent nationwide survey of nurses shows that many of them plan to leave their jobs, suggesting that the nursing shortage will return, according to a release from AMN Healthcare.

The ongoing nursing shortage appeared to dry up last year, as RNs who had been in part-time work or had left nursing altogether came back to fulltime work to supplement dwindling household income.

But the January survey by AMN, a healthcare staffing agency, suggests this surge in the nursing supply will be temporary.

The survey found that:
* 6 percent of nurses permanently employed in hospitals plan to retire in the next one to three years, reducing hospitals’ nursing workforce by more than 70,000.
* 28 percent plan to leave the nursing field entirely or cut back on hours because the job is affecting their health.
* 30 percent said they would not be in their current job a year from now.
* 48 percent said they plan to alter their career path in 1-3 years.
* 55 percent believe that the quality of care that nurses provide has declined compared to five years ago.
* 59 percent said they would select nursing as a career if they did it all over again.
* 64 percent said they would recommend nursing as a career to young people.

Read AMN Healthcare’s release on nursing sup

Illinois Supreme Court Rejects Medical Malpractice Caps

In a setback for physicians and hospitals, the Illinois Supreme Court nullified the state’s medical malpractice law, ruling that a cap on non-economic damages enacted in 2005 by the state legislature is invalid.

“Today’s court decision threatens to undo all that Illinois patients and physicians have gained under the cap, including greater access to health care, lower medical liability rates and increased competition among medical liability insurers,” said J. James Rohack, MD, president of the AMA, in a written statement following the ruling.

The Supreme Court upheld part of a lower court’s 2007 ruling that the state’s medical malpractice law violated the separation of powers clause in the Illinois Constitution by allowing lawmakers to interfere with a judge’s ability to reduce verdicts, according to a report in the Chicago Tribune.

The case, LeBron, a Minor v. Gottlieb Memorial Hospital, involved a malpractice lawsuit filed in 2006 against the hospital by the family of a girl who suffered severe brain damage and other injuries during her delivery there.

The state’s hospital association also spoke out strongly against the ruling, which has been followed closely by the healthcare industry and could play into the national healthcare reform debate this year, according to the Tribune report.

“The hospital community is deeply concerned that this decision will renew the malpractice lawsuit crisis and make it more difficult for Illinoisans to access or afford health care as liability costs for physicians and hospitals are driven to unsustainable levels,” said Illinois Hospital Association President Maryjane A. Wurth, in a written statement.

Read the Illinois Supreme Court’s medical malpractice cap ruling (pdf).

Read the Chicago Tribune’s report on Illinois medical malpractice caps.

Chuck Lauer: 10 Points on Leadership

1. Leading is not the same as managing. There is a huge difference between managing and leading. “Leaders do the right thing and managers do things right,” it has been said. While managers focus on working toward the organization’s goals, orchestrating resources in an effective and efficient manner, leaders need to engage in strategic thinking. They need to pay less attention to details and focus on the big picture.

2. Don’t live in a bubble. Great leaders listen to their people, obtaining a variety of perspectives from a variety of sources. This helps them distill their own decision-making. They ask employees what they think and probe them on the pros and cons of a proposal. This not only shows employees that they are valued but also gets the leader closer to the best solution.

3. Cherish and respect employees. Leaders function as enablers, helping employees perform their jobs to the nth degree. A leader can only get work done through other people. Employees who get respect will produce at their highest capacity and make the leader look good. Make sure people have the tools to do their jobs — and the freedom to make mistakes!

4. Choose a clear mission. Leaders make sure the mission of their organization is plainly articulated and followed day in and day out. A mission statement can sound nice and look really good, but it has to be more than a bunch of words. It should be the very heart and soul of what the organization is about. It should inspire and direct.

5. Demonstrate integrity. Successful leaders recognize that the way they behave reflects the principles and ethics of the organization. Integrity and ethics are essential for any leader. A leader cannot just be “one of the boys.” Leaders need to stand above the rest and show the way.

6. Be transparent. Great leaders don’t believe in secrecy or closed-door meetings. They must conduct themselves with transparency and openness so that rumors don’t start and employees don’t feel shut out. Leaders who are frank rather than evasive — even about difficult issues — will be able to win employees’ trust.

7. Embrace responsibility. Outstanding leaders come in all shapes and sizes, from a variety of backgrounds, but what really sets them apart is their enjoyment in taking on responsibility and willingness to make tough decisions when necessary. Leaders don’t waffle or equivocate. They make sure their decisions are fair-minded and balanced.

8. Share credit. Leaders know the value of giving credit to others, even as they step forward immediately to take the blame for losses, so that their people are protected and valued. “A leader is best when people barely know he exists,” the Chinese philosopher Lao Tzu said. “When his work is done, his aim fulfilled, they will say, ‘We did it ourselves.’ ”

9. Leadership isn’t for everyone. Not all that many people want to take the hard hits that leaders have to absorb, regardless of whether they run a hospital, a clinic or a restaurant. A study of graduate students several years ago showed that well over 60 percent did not want the responsibility of being a leader. While there are many talented people, only a select few will embrace a leadership role.

10. Have courage. Leadership requires courage. Leaders have to go beyond just taking care of their own careers. They need to engage in calculated risks that will secure the future of the whole organization. This is especially important in these trying times, when healthcare is faces so many enormous challenges.

Chuck Lauer ( chuckspeaking@aol.com ) was publisher of Modern Healthcare for more than 25 years. He is now an author, public speaker and career coach who is in demand for his motivational messages to top companies nationwide.

Massachusetts Report Finds Hospitals’ Negotiating Clout With Insurers Drives Up Costs

Massachusetts hospitals and physician groups with market clout negotiate rates that are twice as high as for other hospitals, and such clout is the main cause of healthcare inflation in the state, according to a release by State Attorney General Martha Coakley.

Ms. Coakley’s office based the findings on a year-long study of the Massachusetts market, finding that about 10 hospitals enjoy reimbursements 10-100 percent higher, for similar work, than reimbursements for the other 55 hospitals in the state.

The office’s report says the 10 favored hospitals had brand-name recognition or few competitors in their markets, but it did not name any provider or insurer, saying its aim was to identify systemic problems and not blame individual organizations.

Based on its findings, the report recommended against establishing global payments covering a patient’s entire medical care for an illness, an approach recommended by a state commission.

The study concluded that higher healthcare costs are basically caused by rising prices, not increased demand for new services. One major insurer reported provider price increases accounted for 80 percent of the growth of medical expenses from 2006-2009.

The report called on the state to:

• Discourage or prohibit contract provisions that perpetuate market disparities;
• Increase transparency and standardization in payment and quality;
• Reform payments to account for market distortions; and
• Encourage development of a “value-based” healthcare market.

Read the Massachusetts Attorney General’s release on health insurance reimbursements.

Former Hospital Executive Charged With Stealing From Donations

The former director of the cardiovascular center at South Shore Hospital in Weymouth, Mass., has been charged with embezzling donations to the hospital’s fundraising program and from other hospital sources, according to a report by the Enterprise News.

Federal prosecutors allege that William S. Burke diverted to a personal bank account charitable contributions from the hospital’s “Dare to Care” fundraising program and medical-supply rebates to the cardiovascular center from 2007-2009.

Hospital employees reported the alleged theft to federal law enforcement officials and Burke left South Shore in Oct. 2009, after more than four years of service.

Read the Enterprise News’ report on South Shore Hospital.

Intrapreneurship

I was in a meeting recently and a discussion was proposed as to whom should be the owner of an idea originated inside a hospital. The employee, the institution, both?

It is clear to me that when a physician is hired to do research, the output of this research should belong to the hospital, and the hospital should acknowledge his/her contribution by giving away part of the benefits obtained from it. In this case, the new idea would probably have been unthinkable outside the premises of the hospital, without its infrastructure and assets, so it makes sense.

But what happens if an employee has an idea, let’s say, related to his/her field of experience but not necessarily linked to research? Let’s take this example, if an OR Nurse perceives a need and thinks about a solution to this need while in the operating room, let’s say a new medical device, should the idea belong to the hospital? Well, yes, the idea came to them because they were working at the hospital, but can the hospital claim any ownership over it?

Who is the owner of the idea, then? It may seem a futile discussion, but to me it represents the most important barrier to innovation in our healthcare systems, so it is far from trivial. Sometimes employees don’t engage in innovation because they perceive the ownership issue as unfair. If we want to foster innovation in healthcare, this question needs to have a clear answer. At the end of the day, it all goes down to how the hospital sees healthcare professionals: Do employees work for the hospital, or do they work at the hospital?

Are hospitals really willing to encourage innovation and intrapreneurship inside their premises? Are hospitals willing to create a culture of reward for those entrepreneurs? There is a lot to be gained here: if the hospital succeeds in fostering innovation, it can create a great environment to attract talent, lead, and generate economic value and social impact.

People do respond to incentives. That’s something I learned very early when dealing with innovators and entrepreneurs. Innovation should not trigger a war between the healthcare facility and the employee. It should always be a win-win scenario where both parties can create a lot of value if they cooperate. So, in my opinion this is not about claiming ownership, but about both parties acknowledging how far can they go and how better they will be if they work together, and share the ownership. That’s the answer that makes sense to me.

 

North Carolina Rejects First Health’s Bid for Surgery Center

North Carolina’s Department of Health and Human Services has rejected a certificate of need application by FirstHealth of the Carolinas to build a $3.5 million surgery center in Hoke County, according to a report by theFayetteville Observer.

The Pinehurst, N.C.-based health system, and Cape Fear Valley Health System, based in Fayetteville, N.C. were previously both given approval to move forward with plans to build facilities in the county.

Cape Fear proposed a 41-bed hospital, which gained greater community support, than FirstHealth’s eight-bed hospital and surgery center proposal, according to the report.

A spokesperson for FirstHealth said in the report that if both health systems were to withdraw their appeals, both systems could move forward with construction.

Read the Fayetteville Observer’s report on FirstHealth’s certificate of need denial.

Next Page »