Dan O'Connor
EDITOR'S PAGE
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O U T P AT I E N T S U R G E R Y M A G A Z I N E O N L I N E | J U LY 2 0 1 4
The Dangers of Competing on Cost
ASCs should be happy to remain the low-cost alternative to hospitals.
W
hat makes you different? Whatever it is, that's the thing that
sets you apart and makes you stand out from the crowd.
Sometimes, however, your point of differentiation is not
what you'd like it to be.
"What makes [surgery centers] different in part is that we perform
these procedures at a lower rate," says Nap Gary, chief operating offi-
cer at Regent Surgical Health and president of the board of directors
of the Ambulatory Surgery Center Association.
Mr. Gary was part of an eye-opening panel discussion at May's ASCA
meeting in Nashville, Tenn. He was joined by leaders of 2 other ASC
corporate partners and the head of ASCA. Their message: Rather than
curse the payment differential, ASCs should celebrate that they're the
low-cost alternative to hospital outpatient departments. Remove low-
cost from that sentence, and what do you have? ASCs lose their reason
for being, their place in the healthcare system and their political pull.
"It's frustrating that [the payment differential] exists, but it's nice
that it's there," says Michael Rucker, executive vice president and
chief operating officer at Surgical Care Affiliates, which operates 185
surgical facilities, including surgery centers, surgical hospitals and
hospital surgery departments, in 34 states.
Nobody wants to be known as the cheaper choice, but cost is the
one clear-cut advantage that ASCs have over hospitals. ASCs might
win out on quality of care, infection rates, comfort and convenience,
too, but those are more subjective measures.
Yet the very thing that makes ASCs attractive to payors, patients and
government regulators is the very thing they've been trying to change
about themselves. ASCs have long lobbied for more equalized rates,
but this desire to be reimbursed closer to the much higher hospital
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