What Are The Biggest Challenges To ASC Growth?

3 Becker’s ASC Review articles on the biggest challenges to ASC Growth.

‘We’re doing the ASCs for the sons whose fathers have now retired’: Behind a CEO’s business model

Patty Newitt – Thursday, June 8th, 2023

Mesa, Ariz.-based Surgery Center Services of America has developed more than 300 surgery centers since its inception in 1990. Philip Blair, CEO of Surgery Center Services of America, spoke with Becker’s about his ASC company’s history and obstacles to growth.

Editor’s note: This response was edited lightly for length and clarity.

Question: What’s the biggest obstacle to ASC growth?

Philip Blair: There are still many states that have pretty restrictive certificate-of-need laws. It would just be a huge gold rush and avenue for lowering healthcare costs if governments could give these physicians an opportunity. There’s really only 20 percent of these physicians who are entrepreneurial, who understand the business aspect of running these facilities and take the risk. We have an aging physician population, but we also have new physicians. We’ve been doing this so long that we’re doing the ASCs for the sons whose fathers have now retired or are on the verge of retiring.

The ASC is a proven model. So you have a whole batch of new physicians coming in, and we know the model. There are proven models. If you want to do surgery center with your surgical volume, your specialty, your specific situation, there’s an example out there somewhere in the country that that we can replicate in some fashion or craft for you to meet your needs.

Read this article at Becker’s ASC Review.

Prioritizing surgeon interests key to long-term growth, ASC chair says

Patty Newitt – Friday, June 25th, 2021

ASCs will “lose their edge” if they forget that surgeons are their true customers, according to Ron Blair, chair of Mesa, Ariz.-based Surgery Center Services of America.

Mr. Blair has been developing ASCs since 1990. Surgery Center Services of America has plans to open 14 more ASCs this year and has developed more than 300 centers nationwide.

He spoke to Becker’s ASC Review about what he considers to be the biggest challenge for growing ASCs.

Editor’s Note: This response was edited lightly for clarity.

Question: What’s the biggest challenge for growing ASCs?

Ron Blair: I think the biggest challenge long-term is maintaining accessibility to the payer panels. I can foresee payers using the proliferation of ASCs as leverage to reduce or at least maintain reimbursement levels without providing any increase to cover costs. That probably is the biggest risk to surgery centers.

Also, when you’re running these surgery centers, you can never forget who your customers are. In an ASC, your customers are the surgeons. The surgeons bring the patients, because they’re his or her patients. You’ve got to treat these doctors right, and you have to take care of the patients.

If you deviate from that mission, you’re going to suffer, you’re not going to be competitive and you’re going to lose your edge. There’s going to be another surgery center down the road that’s going to be able to take your patients away.

Read article on Becker’s ASC Review.

‘ASCs could fail with inflation taking hold’: How ASCs can remain profitable

Patty Newitt – Wednesday, June 23rd, 2021

As Medicare reimbursements shift in the next two to four years, some ASC executives are concerned about how ASCs can remain profitable amid inflation.

Ron Blair, chairman of Mesa, Ariz.-based Surgery Center Services of America, spoke to Becker’s ASC Review on how reimbursement policy changes will affect ASCs and how supply chain is hurting profitability.

Mr. Blair has been developing ASCs since 1990. Surgery Center Services of America has plans to open 14 more ASCs this year and has developed more than 300 centers nationwide.

Editor’s note: This response has been edited lightly for clarity and brevity.

Question: What’s a challenge for ASCs in the upcoming years?

Ron Blair: I think a challenge we’ve got down the road, particularly with the current administration, is what’s going to happen with Medicare reimbursements over the next two to four years.

ASCs could fail with inflation taking hold. At the federal level, is there going to be some recognition of this increased cost, and will rates with Medicare reflect that? Are we going to be stuck without any relief? And then how do we manage our increased costs to maintain a good bottom line for the surgery centers? I see that as an evolving challenge for the ASC industry.

I think it’s going to force anybody who’s operating or managing an ASC to analyze their costs. I think you’re going to see collective bargaining on the part of multiple surgery centers with vendors to get better pricing on supplies.

Historically, medical supplies for surgery centers say that ASCs have not done a very good job of holding our suppliers’ feet to the fire. If we see a 10 percent increase in our costs, we’re not going after the supplier for a 10 percent decrease in their product. As an industry, we’ve done a very poor job of that. We’ve kind of just let them have their way or, more importantly, they have decided to not be responsive or even care. I think those days are over.

I think it’ll be a combination of focusing on supply costs and labor costs. But then, I think separately, there’s got to be some relief on the part of the federal government on the Medicare side. While we may not get as much as we’d like, I’m hopeful that we’ll get something.