Ambulatory Surgery Centers

[RemyMcswain]

Is it common for an anesthesiologist to be part-owner of an ambulatory surgery center? Do anesthesia groups get involved in this practice?

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[imfrankie]

Is it common for an anesthesiologist to be part-owner of an ambulatory surgery center? Do anesthesia groups get involved in this practice?

I don't think it is common, but certainly there are surgery centers where anesthesia is a partial owner. The best surgery center I ever worked at EVERYONE, including the floor sweepers, were partial owners. The efficiency, attention to detail and patient satisfaction was incredible.

That's the kind of place to work.

More commonly, the anesthesia group bills independently for it's services, or what is a growing trend is that the surgeons, GI docs, etc, own the facility to capture the facility fee, and want to make money off the anesthesiologists also, so they have some management arrangement where they can hire them on salary and capture part of their billings.

Then of course these surgeons who own the center take all their poor reimbursing patients to the local hospital. It's sickening really.

 

[baller71457]

Then of course these surgeons who own the center take all their poor reimbursing patients to the local hospital. It's sickening really.

Yup

 

[GasEmDee]

I don't think it is common, but certainly there are surgery centers where anesthesia is a partial owner. The best surgery center I ever worked at EVERYONE, including the floor sweepers, were partial owners. The efficiency, attention to detail and patient satisfaction was incredible.

That's the kind of place to work.

More commonly, the anesthesia group bills independently for it's services, or what is a growing trend is that the surgeons, GI docs, etc, own the facility to capture the facility fee, and want to make money off the anesthesiologists also, so they have some management arrangement where they can hire them on salary and capture part of their billings.

Then of course these surgeons who own the center take all their poor reimbursing patients to the local hospital. It's sickening really.

We have this problem at our institution.

 

[jetproppilot]

Yup

I see that more a failure of the large corporate hospitals who somewhere in the shuffle lost the simple concept that DOCTORS are a really, really important part of health care and instead became distracted, concentrating more on shuffling their profits out of the individual institutions and into the pockets of shareholders and top tier administrators.

Why hospitals as a whole haven't empowered the physicians who are responsible for bringing the patients to the hospital and performing very lucrative procedures is beyond me.

Large institutions are mired in inefficiency, largely run by middle management nurse STUPIDvisors who cannot see past the paperwork, unwilling to make changes that would increase efficiency, more concerned with redundant paperwork and meetings rather than focusing more attention on getting a patient from the entrance door to the operating room as quickly as possible, or getting them out of the OR as quickly as possible, or out of the pacu to the floor quicker, or fixing a simple problem a physician has....

Why a hospital's administration has largely muted the physician voice still puzzles me to this day.

The failure of efficient process has also largely contributed to the abundance of physician owned and operated facilities. Money is important, yes, but so is the process. Large hospitals have failed as a whole in paying attention to the process and how obstructionism adversely affects a physician's psyche.

We don't wanna have a meeting a month from now to address a simple problem...we don't wanna listen to middle nurse managers explain their protocols that one could argue are in place largely to justify said nurse manager's existence....

JUST FIX THE PROBLEM!

In large hospitals it just doesn't work that way.

In physician owned hospitals there is a palpable absence of beuracracy, and a tangible feeling of efficiency and accomplishment.

And that's the way it should've been all along.

 

[imfrankie]

But it's okay for the surgeons to bring the folks with no money to the inefficient place.

 

[Coastie]

But it's okay for the surgeons to bring the folks with no money to the inefficient place.

Yep. Why should those with no money deserve to be in an efficient, well-run environment? Things don't become efficient and well-run for free.

Jet, nicely put. I like the word STUPIDvisors.

 

[aneftp]

My friend's old anesthesiology group has a 50/50 split revenue sharing with the surgeons on the surgery center.

Can be very profitable depending on the payer mix.

The surgery center's net profits were close to 4 million each year. So the 7 anesthesia partners split the 2 million profit. Close to $200K per anesthesiologist for just the surgery. They cover two other hospitals. Each partner made between 500-550K each. So owning a surgery center can provide close to 50% of your total income for the year.

But for the most part, it's the surgeons/urologists/GI/ENT docs that are in partnership with one another and anesthesia groups are "independent contracts".....if payer mix is very good...you guys know the drill...so many of of them want the "company model" where anesthesia has to kick back almost 30-49% of of the revenue back to the surgeons.

I know the ASA has written the Office of the inspector general on this matter 3 times know. I have lawyer friends back in Washington. Everyone knows the company model happens. But the government considers the company model, "a victimless crime". That's why DC hasn't moved to issue a ruling on the company model. Because it's the docs who are fighting over money themselves.

 

[imfrankie]

Yep. Why should those with no money deserve to be in an efficient, well-run environment? Things don't become efficient and well-run for free.

Jet, nicely put. I like the word STUPIDvisors.

You'll be able to answer the question of why, when your loved one is on Medicare or worse.

 

[Stank811]

I know of a couple outpatient surgery centers which were owned by large hospitals but were hemorrhaging money so a while back the anesthesiologists/surgeons/other physicians were given the opportunity to buy them...which they did and since have turned them around and are making a nice profit while providing excellent care.

So the question becomes why? Is it because the physicians are bringing in the well insured to the outpatient surgery center or is it because know they have a stake and are in control. When you give the physicians who are responsible for bringing the patients to the hospital and are responsible for making the hospital run efficiently guess what you get the same outcomes if not better and the whole hospital runs better. Physicians are always going to want to provide the best possible care (at least the majority I hope) and then if they are able to make decisions and make more money by making the system more efficient...guess what it becomes more efficient.

So instead of having certain politicians guided by the big hospital lobbyist attempting to pass legislation that states that a hospital can not be owned by more than 40% physicians they should look into all the fat a waste they can remove from their current system and maybe but more power into the hands of physicians and give them more positive incentives.

 

[PinchandBurn]

You'll be able to answer the question of why, when your loved one is on Medicare or worse.

I think most groups nowadays consider Medicare as part of "commercial" insurance when using it to determine RVUs for physicians. Therefore, Medicare and regular commercial insurnce (BCBS,etc) are 'blended' together and physicians get a blended amount per RVU.

However, mediCAID is different. These guys always have the option of stopping their cigarette smoking, buying of expensive 'toys' like watches, iPads, and phones and actually BUYING commercial insurance to pay for their medical services....like the rest of us.

 

[rsgillmd]

You'll be able to answer the question of why, when your loved one is on Medicare or worse.

Being in an inefficient system is a far cry from inadequate care.

Maybe I'm reading too much into it, but it seems like you are just trying to pick fights.

 

[rsgillmd]

I think most groups nowadays consider Medicare as part of "commercial" insurance when using it to determine RVUs for physicians. Therefore, Medicare and regular commercial insurnce (BCBS,etc) are 'blended' together and physicians get a blended amount per RVU.

However, mediCAID is different. These guys always have the option of stopping their cigarette smoking, buying of expensive 'toys' like watches, iPads, and phones and actually BUYING commercial insurance to pay for their medical services....like the rest of us.

Agree on the Medicare thing. Don't know about the RVU part.

Keep in mind that versions of Medicaid are also for poor pregnant Women and Children, not just regular poor. In TN it's called TennCare.

 

[kmurp]

I think most groups nowadays consider Medicare as part of "commercial" insurance when using it to determine RVUs for physicians. Therefore, Medicare and regular commercial insurnce (BCBS,etc) are 'blended' together and physicians get a blended amount per RVU.

However, mediCAID is different. These guys always have the option of stopping their cigarette smoking, buying of expensive 'toys' like watches, iPads, and phones and actually BUYING commercial insurance to pay for their medical services....like the rest of us.

You sound bitter. Though a large percentage of Medicaid recipients are adult poor, they consume only a small amount of the Medicaid budget. The disabled and elderly nursing home patients are 65% of spending with poor children another 15%. For all of these groups, coming up with $15,000 or so for a commercial family plan seems an impossibility. (even with iPhone savings). I'm not exactly sure what your argument was regarding the blended RVU: I'm dense sometimes.

 

[imfrankie]

Being in an inefficient system is a far cry from inadequate care.

Maybe I'm reading too much into it, but it seems like you are just trying to pick fights.

No, I'm not trying to pick fights. I apologize for coming across that way. But I reject the vulgar generalizations that the poor don't deserve efficient care, and that "they" are less human because the don't contribute as much to someone's bottom line.

And I've been in this business quite long enough to smell the worst of my own and others' greed. This is a lying, stealing business just like all others. Only difference is, it's not the business of widgets it's people.

 

[RemyMcswain]

My friend's old anesthesiology group has a 50/50 split revenue sharing with the surgeons on the surgery center.

Can be very profitable depending on the payer mix.

The surgery center's net profits were close to 4 million each year. So the 7 anesthesia partners split the 2 million profit. Close to $200K per anesthesiologist for just the surgery. They cover two other hospitals. Each partner made between 500-550K each. So owning a surgery center can provide close to 50% of your total income for the year.

But for the most part, it's the surgeons/urologists/GI/ENT docs that are in partnership with one another and anesthesia groups are "independent contracts".....if payer mix is very good...you guys know the drill...so many of of them want the "company model" where anesthesia has to kick back almost 30-49% of of the revenue back to the surgeons.

I know the ASA has written the Office of the inspector general on this matter 3 times know. I have lawyer friends back in Washington. Everyone knows the company model happens. But the government considers the company model, "a victimless crime". That's why DC hasn't moved to issue a ruling on the company model. Because it's the docs who are fighting over money themselves.

Are you saying that the total earnings were split equally with the surgeons? Do you receive a different "technical" fee for being the owner of the surgery center? Is there a "facility" fee that is different from the professional fee. I know if you own an xray machine you get the professional fee and the technical fee. Is the owing of a surgery center analogous to that?

(Starting residency in july, so please excuse my ignorance)

 

[Whitesnooze]

I don't think there has been as much government intervention (rules, regs etc) into free standing surgical centers. I hope it stays that way, but doubt it.

I agree that in my observations the physician owned model is much more efficient than the hospital owned. The physicians who bring the patients in share in the dividends of the facility fees. Therefore the anesthesiologists who don't have a pain practice are rarely asked to join the owners. The physicians owners tend to iron out the kinks faster because it affects a portion of their income. When the hospital owns it who knows where the money goes?

I was aware of a free standing facility several decades ago founded by among others an anesthesiologist who would have been one of the owners. But it wasn't run successfully and failed.

 

[pgg]

But I reject the vulgar generalizations that the poor don't deserve efficient care, and that "they" are less human because the don't contribute as much to someone's bottom line.

Reasonable and non-greedy, non-vulgar people can assert that unlimited, unconditional, on-demand, absolutely free healthcare is not a right.

 

[imfrankie]

Reasonable and non-greedy, non-vulgar people can assert that unlimited, unconditional, on-demand, absolutely free healthcare is not a right.

Even nasty people can assert that--and justifiably in my opinion. But of course that is not what I am suggesting.

 

[gaspasser2004]

I know of a couple outpatient surgery centers which were owned by large hospitals but were hemorrhaging money so a while back the anesthesiologists/surgeons/other physicians were given the opportunity to buy them...which they did and since have turned them around and are making a nice profit while providing excellent care.

So the question becomes why? Is it because the physicians are bringing in the well insured to the outpatient surgery center or is it because know they have a stake and are in control. When you give the physicians who are responsible for bringing the patients to the hospital and are responsible for making the hospital run efficiently guess what you get the same outcomes if not better and the whole hospital runs better. Physicians are always going to want to provide the best possible care (at least the majority I hope) and then if they are able to make decisions and make more money by making the system more efficient...guess what it becomes more efficient.

So instead of having certain politicians guided by the big hospital lobbyist attempting to pass legislation that states that a hospital can not be owned by more than 40% physicians they should look into all the fat a waste they can remove from their current system and maybe but more power into the hands of physicians and give them more positive incentives.

Numerous books have been written on the business model of McDonalds. They all go back to the single most important part: the owner/operator. An owner/operator, whether they own one store or a hundred stores, is ultimately accountable for the success of their store(s). From time to time, the McDonalds corporation will take over a struggling store temporarily or run a store for training purposes - these stores never do as well as the store that is run by an owner/operator.

In medicine, physicians who own the "store" will make it more efficient and better for the patient because they are ultimately accountable. I do believe that funny business takes place (the cookie jar is just too tempting for some) and those individuals should be punished. However, lets not throw the baby out with the bathwater.

 

[pgg]

Even nasty people can assert that--and justifiably in my opinion. But of course that is not what I am suggesting.

OK, then if healthcare is not an inalienable right, and some level of payment is expected and some degree of capitalism is permitted, why should a surgeon choose to do his charity cases in the surgicenter that he owns vs in a hospital that has agreed to do them?

It seems to me that he's being generous enough already to donate his time at the hospital. Why must he donate his time AND his surgicenter profits (and the profits of his partners) when there's a hospital across the street willing to eat part of the cost?


Surgicenter cases are heavily slanted toward the elective side. I don't think any of us would refuse to do a charity appendectomy for a non-english-speaking "unemployed" illegal-immigrant in house, but scheduling the same patient at the surgicenter for a bunionectomy because his feet hurt is something else.


This is what I think I'm hearing:

You: "Dr Surgeon, you're a bad person for donating your time, accepting the liability, and operating on your uninsured/'self-pay' cases at the public hospital instead of that ritzy surgicenter you invested your time, money, and financial risk in."

Correct me if I'm wrong. Again, I just don't see how it's reasonable to criticize the manner in which a person chooses to serve the poor.

 

[jetproppilot]

.

 

[Narcotized]

Numerous books have been written on the business model of McDonalds. They all go back to the single most important part: the owner/operator. An owner/operator, whether they own one store or a hundred stores, is ultimately accountable for the success of their store(s). From time to time, the McDonalds corporation will take over a struggling store temporarily or run a store for training purposes - these stores never do as well as the store that is run by an owner/operator.

In medicine, physicians who own the "store" will make it more efficient and better for the patient because they are ultimately accountable. I do believe that funny business takes place (the cookie jar is just too tempting for some) and those individuals should be punished. However, lets not throw the baby out with the bathwater.

Excellent post. Agree with the owner/operator model 100% percent. Also explains exactly why government central planning job creation is the worst possible use of a country's limited resources. People hired with no incentive to perform well doing jobs that had no market driven reason to exist in the first place.

 

[imfrankie]

I don't think it is common, but certainly there are surgery centers where anesthesia is a partial owner. The best surgery center I ever worked at EVERYONE, including the floor sweepers, were partial owners. The efficiency, attention to detail and patient satisfaction was incredible.

That's the kind of place to work.

I'm pretty certain I said the above.

But you get stuck at the poor man's hospital doing all the cases that don't pay because your buddy across the street at the surgery center has the contract for all the paying folks (of course because he's kicking back some action to the surgeons) and see if you aren't a little more circumspect.

 

[pgg]

I'm pretty certain I said the above.

But you get stuck at the poor man's hospital doing all the cases that don't pay because your buddy across the street at the surgery center has the contract for all the paying folks (of course because he's kicking back some action to the surgeons) and see if you aren't a little more circumspect.

Now the problem is that another anesthesiologist has better connections and a better job than you?

I'm not trying to be difficult or obtuse (really!) but I don't see the problem.

I'm also not speaking from a position where I'm profiting from any of this stuff and have a reason to defend shady practices. I work for the least efficient, worst paying pseudo-HMO in the United States.