5/28/2013. Objectives. CASCA 2013 ASC Efficiencies An Advanced Perspective. I. Evaluating the Operations and Efficiencies of an ASC.

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The Surgeon and Physician Services Experts

CASCA 2013

ASC Efficiencies – An Advanced Perspective

Dawn Q. McLane-Onofrio RN, MSA, CASC, CNOR Health Inventures – VP Consulting, Development and Integration

Objectives

I.

Evaluate operations and efficiencies of an

ASC

II. Determine when the business has reached a

critical mass  is it time to expand the

business & conversely the when to shrink

the business

2

The Surgery and Physician Services Experts

the business

III. Advanced look at management efficiencies

HR tools – Position Control

 labor management  benchmarking  process management

I. Evaluating the Operations and

Efficiencies of an ASC

The Magic of Rounding: Quint Studer

Brings a Leadership Technique from

Medicine into the World of Business



R

di

t k

lk f

h

3



Rounding – take a walk for an hour a

day



Make personal connections with staff and

physicians

Rounding

gather information in a structured way

reinforce positive and profitable

behaviors

identify problems – ongoing

4

identify problems ongoing

assessment

evidence based leadership study:

demonstrated that rounding works to

accomplish the 5 things employees

need from their leaders

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Bonding with our Employees

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5 Things Employees Need from Leaders

1. A manager who cares about and values them

 rounding builds relationships  retention

2. Systems that work and tools and equipment to do their jobs

 ask if they have everything they need

 a time for evaluation

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 a time for evaluation

 a time to identify opportunities

3. Opportunities for professional development

 observe, intervene

 identify and provide training and/or mentoring

 praise high performers

5 Things Employees Need from Leaders

4. Recognized and rewarded for doing a good job

 observe, ask and share

 builds greater productivity

5. Work with high not low performers

 requires you to manage the process

7

 requires you to manage the process

 low performers drive high performers out the door

Management Foundation

 Tell employees what you expect of

them

 Evaluate and tell them frequently

8

q

y

how they are doing in regard to your

expectations

 Reward them accordingly

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Rounding Skills

Part of the culture of the organization

Requires training and self discipline

Communication – getting started

 tell employees what you will be doing

 “ ti t” li t f k bl

9  “scouting report” – list of known problems

 make a personal connection – genuine individual information

 show that you are addressing specific issues that have been identified

Rounding Skills

Ask 5 questions:

1)

what is working well?

2)

is there anyone I should recognize?

3)

do you have the tools you need?

10

)

y

4)

is there anything we could do better?

5)

what else would you like me to know?

Rounding Skills

Sincere effort to address problems as they are raised

 provide assurance to employees during the process

 demonstrate improvement where possible Record issues in a “rounding book”

11 Recognize and reward those identified by peers

as high performers Program: “Warm Fuzzies” Repeat daily when possible

 make it part of your routine – part of the culture or the leadership team

The Business of ASCs

Approx 70% of surgery is outpatient

70% of outpatient surgery is ASA I and II

ASA III is increasing due to technology

Where surgeries are performed:

12

Where surgeries are performed:

 Hospital 38%...50% could be ASC cases

ASC 60%

Physician office 2%

McGuire Woods: >1/3 of ASCs break even

or lose $

(4)

The World of ASCs

5876 freestanding ASCs at end of 2008

 22% owned or managed by a corporate chain / partner Medicare Certified ASCs:

 2000 – 2008 6.9% average growth per year ============================================= 13  2000 – 2005 8% growth  2005 – 2007 5.2% growth  2007 – 2008 3.7% growth =============================================

2000 – 2008 Avg of 319 new ASC – 58 closed

Critical Decisions

What separates a successful center from the

1/3 who are breaking even or losing $?

Architectural Design and Facilities Management Leadership and Governance (culture)

Anesthesia Services Patient Scheduling & EMR

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Staffing

Equipment & Technology

Supply Standardization & Inventory Control Volume and Case Costing

Performance Measurement (clinical and financial) Payor Contracting  Reimbursement

Communication through the Organization

Architectural Design &

Facilities Management

If you build it, they will come!!!



Cardinal sin – overbuilding



Realistic expectation by partners re: number of cases

OR (

i d

d t 1000/ OR /

)

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per OR ( case mix dependent: 1000/ OR / yr avg)



Plan patient & visitor comfort, materials & support svcs

productivity, clinical functionality = attractive, warm,

comfortable and functional without “extras”

ASC Market Trends

~20 million surgeries are performed each year in the more than 5,000 surgery centers across the United States

Low to no growth in the total number of licensed ASCs in the U.S.

Nearly every ASC has significant excess capacity – the industry is overbuilt

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The Surgical and Physician Services Experts

industry is overbuilt

More than 70% of eligible physicians are already invested in an ASC (up from 30% in 1990) More employment of physicians and expected 15%

surgeon attrition in the next five years exacerbates the biggest problem facing ASCs– lack of “recruitable” physicians

(5)

ASC Market Trends

Increasingly challenged reimbursement environment

Medicare reimbursements for ASCs have declined from 87% of HOPD rates in 2003 to 56% in 2013 Commercial payer rates being driven towards

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Medicare levels

Costs aren’t likely to trend down with reimbursement, squeezing margins and profitability

Only the best managed centers will survive Increasing trend to partner with hospitals/health

systems for reimbursement and physician recruiting leverage

Freestanding ASC Growth

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5/28/2013

Decreasing ASC Eligible Surgeons

Drivers:

 economy

 market saturation – geographic areas  physician supply

 reimbursement cuts

19  mature businesses  succession planning

ASC Eligible Surgeons per ASC in the US

1990 1995 2000 2005 2010E

The Surgeon and Physician Services Experts 60.4

43.1 _32.5 23.2

20.3

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The Surgical and Physician Services Experts

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Leadership and Governance

Culture

“Culture eats Strategy for lunch!”



transparency – shared

financial information



accountability

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accountability



responsibility



meet regulatory requirements: QAPI &

Infection Control



involved (knowledgeable) in the

management of the ASC

Anesthesia Services

Anesthesia providers can make or break the

success of an ASC

 must be willing to be a fully productive member of the team

 willing to start IV, push a stretcher, help turn over a room

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Anesthesiologists and/or CRNAs

 Board approved panel

 independent providers, group(s), national provider Dedicated to ambulatory anesthesia practice

 patients awake in the OR or upon admission to PACU

 regional blocks

Participate in medical staff governance- MEC / COC

Patient Scheduling

Creative scheduling

 Open scheduling

 Block Scheduling

 Modified Block Scheduling

Eliminate where possible, the scheduling gaps Utilization goal – 75-85%

M th bl k t l M di l Di t

23 Manage the blocks quarterly – Medical Director actively involved in leading the block

management

Block release: 1 week, 3 days, 1 day

Cases start on time (in room within “5” minutes of scheduled time)

Turnover times – avg 9-12 minutes

Medical Staff

Rules & Regs

 Scheduling policies define patients appropriate to the ASC

 Medical screening by RN staff  anesthesia staff

 Low incidence of same day cancellations

 Surgeons available in the ASC 15 minutes prior to scheduled surgery time

 Surgeon assumes leadership role in marking the site an

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time out processes

 participation in quality improvement and credentialing committees

 willing to work toward efficiencies: standardization of instrumentation and supplies, implants

 supports and participates in compliance and regulatory requirements : infection control practices and surveillance

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Staffing

The right person in the right seat on the bus!! Management team members must be on the same page….

Create an organizational culture………..Goals Effective leadership is measured by efficiencies and outcomes; management with integrity

25 and outcomes; management with integrity

Work ethic is imperative in these times Employee expenses represent 37% of total expenses (VMG)

Staffing Philosophy

 Position Control (see next slides)

 FT….. PT….. prn….. Agency…. Travelers

 maximize continuity with the most flexibility for your setting

 stagger shifts to avoid OT

================================================

 FT & PT – most continuity, competency, team spirit, participate in meeting center’s goals with less time spent

Staffing

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participate in meeting center s goals with less time spent managing the HR processes

mature center with reliable case volume so you can flex staff

 PT & prn – more flexibility and offers potential to reduce benefits costs

 agency and travelers – increase costs on a per FTE basis but offers maximum flexibility

new ASC just building volumes

difficult recruitment area

Non-productive time vs Low Census

Meet regulatory requirements

 Licensure requirements

 Medicare certification requirements • Infection Control

• QAPI

27 Accreditation requirements

Cleaning, stocking, checking outdates,

re-sterilization

Special Projects

Staffing Efficiencies

Position Control – identify positions needed for each area including budget

Job Descriptions

Identify cross-training opportunities

Expectations clear from date of hire and reinforced at appraisal time

28 pp

Share financials with staff and reward excellence Flow Charts to identify “best practices” and efficiencies in process flow

Preference cards up to date

Instrument inventory list that minimize the number of instruments in a tray  easier to turnover

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Staffing

Position Control for ANY ASC

2011 ‐ Apr

Position RankName FTE Budget Min SalaryMid SalaryMax Salary Salary Expense

ADMINISTRTION Administrator OPEN 1.0 130,000 0 Director of Nursing OPEN 1.0 100,000 90,000 99,500 109,000 0 Business Office Mgr OPEN 1.0 65,000 54,080 60,173 79,997 0 Medical Director 0.0 24,000 0 3.0 319,000 #DIV/0! $ ‐

OR Min Hourly Mid Hourly Max Hourly

RN OPEN 1.0 82,000 29.07 37.13 46.01 0 RN Phase II Hire 0.0 0 0 RN Phase II Hire 0.0 0 0 RN Phase II Hire 0.0 0 0 RN OPEN 0.5 41,000 29.07 37.13 46.01 0 RN OPEN 0.5 41,000 29.07 37.13 46.01 0 RN Phase II Hire 0.0 0 0 RN Phase II Hire 0.0 0 0 RN OPEN prn 16,400 29.07 37.13 46.01 0 2.0 180,400 #DIV/0! 0 29

The Surgeon and Physician Services Experts CST / ORT ORT OPEN 1.0 50,000 17.96 24.26 27.58 0 ORT Phase II Hire 0.0 0 0 ORT Phase II Hire 0.0 0 ORT Phase II Hire 0.0 0 ORT Phase II Hire 0.0 0 0 ORT OPEN prn 10,000 17.96 24.26 27.58 0 1.0 60,000 #DIV/0! 0 Peri‐op Staff Peri‐op Coordinator OPEN 1.0 85,000 31.07 39.13 48.01 0 RN ‐ Pre‐op OPEN 0.5 82,000 29.07 37.13 46.01 0 RN ‐ Pre‐op Phase II Hire 0.0 0 0 RN ‐ Pre‐op Phase II Hire 0.0 0 0 RN ‐ PACU OPEN 0.5 41,000 29.07 37.13 46.01 0 RN ‐ PACU Phase II Hire 0.0 0 0 RN ‐ Phase II Recovery OPEN 0.5 41,000 29.07 37.13 46.01 0 RN ‐ Phase II Recovery Phase II Hire 0.0 0 0 RN ‐ Peri‐op Float Phase II Hire 0.0 0 0 RN ‐ Peri‐op Float Phase II Hire 0.0 0 0 RN ‐ Peri‐op prn OPEN prn 16,400 29.07 37.13 46.01 0 RN ‐ Peri‐op prn OPEN prn 16,400 29.07 37.13 46.01 0 2.5 281,800 #DIV/0! 0

Staffing

Position Rank Name FTE Budget Min Salary Mid Salary Max Salary Salary Expense

Clinical Support Materials Coordinator OPEN 1.0 60,000 25.00 26.20 38.46 0 Instrument Tech OPEN 1.0 45,000 16.50 18.76 22.24 0 Instrument Tech Phase II Hire 0.0 0 0 2.0 105,000 #DIV/0! 0 Business Office 30

Scheduler OPEN 1.0 42,000 16.27 18.37 25.17 0 Patient Accounts Rep ‐ Biller OPEN 1.0 38,000 15.72 17.00 25.73 0 Patient Accounts Rep ‐ Collections Phase II Hire 0.0 0 0 Patient Accounts Rep ‐ MR Phase II Hire 0.0 0 0 Registration Receptionist Phase II Hire 0.0 0 0 2.0 80,000 #DIV/0! 0 TOTALS 12.5 1,026,200 0.0

Process Flowchart - Scheduling

ANY SURGERY CENTER

SCHEDULING PROCESS FLOWSHEET

Receive Call from Surgeon Office Scheduler

Receive Fax from Surgeon Office Scheduler

Verify Information on Fax and Schedule into Block or Open Time/ Conflict Checking

Scheduler

Notify Materials Manager if Resource Needed (equipment or implant) Scheduler/Materials Manager

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Complete Patient Demographics in Scheduling Program

Scheduler

Insurance Verification/ Patient Call if Necessary regarding Co-Pay

AR Specialist

Pre-op Phone Call for Patient History and Demographic Record Completed

Pre-op RN /Admitting Clerk Pre-op Worksheet to Registration and AR

Scheduler

Patient Chart Completed Pre-op RN

Process Flowchart - Registration

ANY SURGERY CENTER -- REGISTRATION/ADMITTING PROCESS

Update Patient Demographics Data Entry Admitting Clerk

Patient Pre-authorization Validated A/R Representative/Admitting Clerk

Patient Presents Day of Surgery Patient Registered

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Admitting Clerk

Registration/Financial Responsibility Signed Admitting Clerk

Co-pay/Deductible Collected/Receipt Given Admitting Clerk

Cash Drawer Contents Balanced and Given to A/P Clerk or Admin. Assistant for Deposit

Admitting Clerk Financial Contract Signed (if applicable)

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Process Flowchart - AP

ANY SURGERYCENTER-- ACCOUNTS PAYABLE PROCEDURES

Incoming Mail – Sort & Distribute Administrative Assistant

Match P.O. to Receiver Materials Assistant

Match Invoice to P.O. Verify Price Approve and Schedule for Payment

A/P Clerk 2nd Approval for Administrative Purchases Executive Director Medical Director Board Chairman 33

Data Entry to IS (Quick Books) A/P Clerk

Sign Checks Executive Director Medical Director Board Chairman

Mail Checks and File Paid Bills A/P Clerk Computer Checks Generated

A/P Clerk

Process Flowchart -

AR-ANY SURGERY CENTER -- ACCOUNTS/RECEIVABLE PROCEDURES Surgery Scheduled

Clinical/Billing Chart Created

Scheduler

Pre-certified Insurance or Cash Arrangement

A/R Representative

Pre-op Phone Call Clinical Chart Updated/Financial Arrangements

Pre-op Nursing/Anesthesia

Patient Arrives/Registers/Financial Forms Signed Collect Co-Pays

Registration Clerk

Surgery Completed Clinical Chart Completed

Clinical Personnel

Clinical Staff Data Entry

Clinical Personnel

Clinical Chart & Billing Charts Separated

Financial Arrangements A/R Representative OP Report Dictated Surgeon Transcription to Chart 34

g p

Registration Clerk

Billing Data Entry

Patient Accounts Representative

Billing Generated/Transmitted to Responsible Party (24o ) after Coding and Invoice Mailed (48o)

Patient Accounts Representative

Incoming Mail/Deposits Listed

Administrative Assistant

Payments Received, Photocopied and Deposited

Accounts Payable Clerk or Administrative Assistant

Deposit Receipt to AP/Checkbook

Accounts Payable Clerk

Payments Posted to Patient Accounts from Photocopy of Checks & RA/Adjustments Made

Accounts Receivable Representative

Weekly Past Due Report 45 days Collections Procedures Initiated with Approval of Manager

Paid or Adjusted Accounts Receivable Patient Account Closed

p and Coded

A/R Representative

Process Flowsheet - Materials

ANY SURGERY CENTER – MATERIALS MANAGEMENT PROCEDURES

Purchase Order Initiated

Materials Coordinator

Approval < $5,000

Clinical /Medical Director

Order Placed Materials Coordinator Order Received >$5,000 Approval Executive Director 35

Order Received

Materials Coordinator

Yes

Reconciles P. O. , Packing Slip and Invoices

Accounts Payable Clerk

Complete Shipment? No Copy of P.O. & Packing Slip to A/P

Materials Coordinator

Copy of P.O. & Packing Slip to A/P

Materials Coordinator Complete No Shipment?

To A/P Procedures

Equipment, Technology and Supplies

Standardization of instrumentation and supplies

Supply Expense accounts for 28% (VMG) total

expense JIT inventory

I l t i t

36

Implant consignments

Case cost analysis  best practices among surgeons and benchmarks

Open only what is needed … hold supplies until needed

keep preference cards up to date

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Volume and Case Costing

Accurate budgeting and projections

Case costing (knowing what it costs

to do cases)

 leverage when

negotiating payor contracts and

supplier contracts

37

supplier contracts

Value Analysis Committee – decides

when new supplies, implants,

equipment will be considered for

purchase

Performance Measurement

(clinical and financial)

External benchmarking

 ASCA

 AAAHC Quality Institute

 VMG  State DOH  State associations  management company 38 Internal benchmarking

 study within your organization – a physician or process over time to determine best practice within your organization Clinical and financial outcomes

 transfers, infections, adverse occurrences

 financial ratios (cost of staffing or supplies % of total expense or % of NR)

Dashboard

DASHBOARD for April 2010

GY N 20% Ophthalmology 2% Oral and Dental 4% Ortho 11% Pain Management 1% Podiatry 2% Urology 10% 40%

Total Pe rsonnel Cost as a % of Total Oper ating Cost

38% 29% 35% 34% 0%0% 0%0%0%0%0%0% 0% 10% 20% 30% 40% Ja n Fe b Ma r AprMa y Ju n Jul Aug SepOct No v De c Supply Cost as a % of Net Re venue 141 158 176 173 100 150 200 250 300 350 Ja n Fe b Ma r Ap r Ma y Ju n Jul Au g Se p Oc t No v De c

NUM BER OF CASES

YEAR to DATE CASES by SPECIALTY

108%104% 87%98% 0%0% 0% 0%0%0%0%0% 0% 20% 40% 60% 80% 100% 120% Ja n Fe b Ma r AprMay JunJul AugSep Oc t No v De c

Total Cos ts as a % of Net Re venue

25 4 33.5

36.0

43

ACCOUNTS RECEIVABLE DAYS

39

ENT 0%

Gen 50% Any Surgery Center

26% 28%29% 29% 20% 30% Ja n Fe b Ma r Apr Ma y Ju nJul Aug Sep Oct No v De c 18.3 14.5 14.1 13.9 6.50 8.50 10.50 12.50 14.50 16.50 18.50 20.50 Ja n Fe b Ma r Apr Ma y Ju n Jul Aug SepOct No v De c

TOTAL LABOR HOURS PER CASE

14.0 10.7 10.3 10.1 3.00 5.00 7.00 9.00 11.00 13.00 15.00 Ja n Fe b Ma r Apr Ma y Ju n JulAug Sep OctNov Dec

CLINICAL LABOR HOURS PER CASE

37% 30% 25% 29% 10% 20% 30% 40% 50% Ja n Fe b Ma r AprMay Jun JulgAu Sep OctNov Dec

Total Pe rs onel Cost as a % of Ne t Reve nue 25.3 25.4 3 13 23 33 Ja n Fe b Ma r Ap r Ma y Ju n Jul Au g Se pOct No v De c

Decisions

40

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Grow or Control: Challenges?

Reaching a critical point… can’t get

cases on the schedule in a timely

manner?



good problem to have



you’ve maximized productivity and

41

efficiencies discussed



to expand on site or build denovo

•infrastructure can handle it •LSC

•built with additional shelled OR(s) •designed for future growth

Shrinking: Challenges?

Case volumes have declined and

you are faced with new problems?



gaps developing in the schedule



Hrs / Case growing



profitability is declining  distributions not

42

p

y

g

possible or decreasing in frequency or $$

Tough decisions:



close a room



adjust schedule to fewer or shorter days



changes in staffing philosophy

ASC Ownership

43

Affordable Care Act

History: ASC payments frozen for past 7 of 9

years

HOPD vs ASC

 2003 87% HOPD – payment methodology

 2009 62.7% HOPD  2010 62 1% HOPD 44  2010 62.1% HOPD  2011 61.0% HOPD  2012 58% HOPD

 2013 56% HOPD (per ASCA Nov 1) •

HOPD = 2.1% vs ASC 0.6% increase

»1.4% inflation increase CPI – 0.8% productivity reduction

• Geographical adjustments may decrease further

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Quality Reporting

 Reimbursement

Quality Reporting began October 1, 2012 to determine payment in 2014 (2% reduction for non-compliance) Quality Measures adopted by CMS

Developed by the ASC industry – ASC Quality Collaboration Endorsed by National Quality Forum

http://www.ascassociation.org/ASCA/ResourceCenter/Publications /ASCFocusMagazine/Medicare2012Measures/

45

/ASCFocusMagazine/Medicare2012Measures/

Based on participation in reporting – G codes

Quality Measures Specifications Manual

-Manualhttps://higherlogicdownload.s3.amazonaws.com/ASCACONNE CT/ASCSpecsManual%20_UpdatedJuly2012.pdf?AWSAccessKeyId=A KIAJH5D4I4FWRALBOUA&Expires=1345221715&Signature=KKuQC% 2FM8r6i2JRqvCmgBUaXf1GY%3D

Quality Measure Implementation Plan

46

The Surgeon and Physician Services Experts ASCA website No new measures added Nov 1, 2012

Definitions

47

The Surgeon and Physician Services Experts ASCA website

Considerations …..

What is our long term strategy for the ASC? Is the ASC a financial investment or a low cost site of care where the physicians have significant input and control of their environment?.... Why are they invested?

What is our succession plan?

What is happening in our community that may impact

h ASC l d i b h

48 the ASC volumes and reimbursement over the next 5 years…. Or longer? (physician loyalty, payor contracts)

Who are our competitors?

What kinds of challenges or constraints might we face? (location or age of the physical plant)

Are we the best we can be: efficient, cost conscious, standardized, etc

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Thank You!

49 49DQMDQM