On today’s episode you’ll hear our interview with Mike Scribner and John Crew. We covered a variety of topics, such the No Suprises Act and other regulatory and legislative trends, and the role of Medicare Advantage in Ambulatory Care. We also talked about the impact of traditional Medicare to independent ASC's and the managed care strategies independent ASC's can take and utilize in 2023.
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Production & Editing: Nyla Wiebe
Show Notes & Transcription: Aaron C Higgins
Social Media Management: Jeremy Miller
Interview host: Jason Crosby
Executive Producers: Mike Scribner & John Crew
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:19):
Thank you.
Explored key issues in theambulatory surgery center market
with experts Mike Scribner andJohn Crew.
In this episode, Mike and Johndive into a range of timely
topics, including theimplications of the no Surprises
Act, regulatory and legislativetrends and the growing
influence of Medicare Advantagein ambulatory care.
They also discuss thechallenges and opportunities
(00:40):
presented by traditionalMedicare for independent ASCs,
managing shared care strategiesthat help ASCs navigate the
evolving landscape in 2023 andbeyond.
So, whether you're part of anASC, a healthcare professional
or simply interested in thelatest developments in the
industry, this replay stilloffers valuable insights into
(01:01):
strategies, even in today'smarket.
Tune in to gain a deeperunderstanding of the forces
shaping ambulatory care and stayahead as we revisit this vital
conversation.
Speaker 2 (01:17):
Hey everyone, I'm Jason Crosby with Strategic
Healthcare Partners and yourhost for today's episode where
we are kicking off season two.
I am joined by SHP principalsMike Scribner and John Crew,
where today we will discussmarketplace trends with
ambulatory surgery centers, orASCs.
So with that, let's just jumpright into the conversation.
John, you start us off.
Take a brief look back atrecent trends in the ASC market.
(01:40):
What has impacted such thingssuch as value-based care, no
Surprises Act or otherregulatory changes as of late
for ASCs?
Speaker 3 (01:48):
Well, jason, thanks for asking, and again, this is
John Crew.
We do want to take a moment totake a look back at all the
things that have happened or arehappening as it relates to ASCs
, particularly in thevalue-based care world, the no
Surprises Act, price andtransparency.
There's a lot of regulations, Iwould say, and Mike can
certainly comment to this.
(02:09):
I would say that when a lot offolks were building their ASCs,
there was an opportunity aboutwhether or not they wanted to be
in networks, stay out ofnetwork, what worked best, a lot
of people trying to determinethe financial situations for
their ASC.
And I think we're seeing asignificant change in the
marketplace now that's affectingall of that, particularly as it
(02:30):
relates to Medicare Advantage.
And I say that because and Mikecan certainly comment here I
would say that we're seeing fromour client base, the fastest
growing clinical population outthere now is Medicare Advantage.
Historically speaking, we for along time really, we stayed in
the red, white and blue model,Medicare sort of creeped along
(02:53):
and kept growing.
But now we see in a lot ofcases where their client bases
were now as far as a Medicarepopulation in and of itself,
that nearly two thirds of theirpopulation is Medicare Advantage
now, where just a few years agothat would have been the exact
opposite and there'd been morered, white and blue.
Any thoughts around that,michael?
(03:13):
Yeah?
Speaker 4 (03:15):
John, this is Mike.
I guess kind of to step backinto your opening comment, the
landscape from an ASCperspective, from our
perspective, a managed careperspective, has changed
drastically over the last sevenor eight years.
You go back seven, eight, tenyears and, just like you said in
your opening comment, that alot of ASCs, where they're fed
(03:40):
by their practice ownership andit kind of breaks down the
connectivity of managed care ofthe referral source.
When the referral source isbuilt in there's really no
reason to have to contract inorder to achieve the volume.
Therefore it became more of afinancial game of what made
sense to be in versus out ofnetwork.
But just like you're alludingto, there's been a whole host of
(04:04):
factors that kind of dampenedthat ability over the past
several years the emergence ofhigh deductible plans, the
rollout of the exchange plans,that kind of put that on
steroids and kind of moved uphigh deductible plans into kind
of more of the normalcy.
You kind of couple that with nosurprises act that we were
commenting on that between thefact that it imposes a
(04:30):
prohibition against balancedbilling, coupled with kind of
built-in federally ordainedmechanisms to put a value-based
price on it that lowers the gapbetween in versus out of network
potential reimbursement thatalso kind of shut down angles of
benefit for being out ofnetwork in the first place,
(04:50):
which has kind of led the ASCcommunity to have to go back and
, you know, on a payer by payer,product line by product line
basis, have to redeterminewhether or not to get a network.
And a lot of times at this pointthe answer is yes, that they do
need to go back and build acontracted portfolio in order to
maintain the ability to seethose patients.
(05:11):
And then, adding on the pointthat you were just talking about
with the Medicare Advantageworld, again you go back seven
years ago and, just like yousaid, 10% of the Medicare
population, 15% of the Medicarepopulation, is in a Medicare
Advantage plan at that point.
Now, with it being over half,maybe as much as two-thirds,
like you were talking about, andas those plans have rolled from
(05:34):
all PPO orientation and fullout-of-network benefits and all
those kinds of deployments, thatagain made it where you didn't
really have to contract in orderto play.
Now we're at a point wherethere's more HMO in the market,
no out-of-network benefit HMOsin the market, such that again
it's tougher to get your patientfrom practice to ASC, no matter
(05:57):
what the payer source is now inthe current world, and so it's
changed the world dramatically.
Speaker 3 (06:04):
You know that's a great point.
Michael, you touched onsomething that I think it's too
easy to lose sight of and it'stoo easy for me to lose sight of
as well is the fact that whenyou think about a practice, that
open ASC and I'm not trying tobe redundant, but the fact that
you really fill that ASC up withyour own patients, and today
now you're going to have to lookexternal about how you get your
(06:25):
patients and I know we'll talkabout value-based care in a
minute but I think about all thegrowth of the vendors that are
coming into the marketplaces.
You think about our friends inFlorida where we've had
aggressive MA growth andaggressive MA value-based growth
, and now how they have to workwith others to get their
referral base, and so that's achange that we're going to see.
(06:47):
We'll talk more about, butthat's a change we're seeing and
I think that's a significantchange and just as important as
understanding.
That is, if you're going tohave to move in that flow of
understanding that I'm now goingto have to contract more, it's
got to be essential to an ASCnow to financially understand
what that means to them, becausethere's a reasonable likelihood
(07:08):
that you're simply going toreprice your patient population.
It may not be a new population,you're simply going to reprice
it, and understanding thefinancial impact of that to your
ASC I think is essential tothat.
Speaker 4 (07:23):
Which, as of today has and John, jump back in and
tell me your experience.
As of today, our generalreaction in the market has been
that because these market forcesare kind of pushing pricing
down and limiting the referralsources to the point where I
have to go back and contract toget in, which also kind of
(07:44):
serves to depress the pricing inthe first place, the basic
practice reaction is we'll haveto cram more volume through
there at the lower pricing inorder to retain what I had
before, which is a.
That's a tough place to bebecause that's a, you know, now
I have to.
There's only so much volume, asyou always talk about, and that
(08:04):
I have to.
You know I much volume, as youalways talk about, and that I
have to.
You know I'm already attemptingto do as much as I can in the
ASC setting and not in thehospital setting in order to
kind of feed the practices onmechanism.
But it's a tough place to beright now.
And what has always sort ofperplexed me is that From an ASC
(08:26):
perspective, the same care istypically being rendered much
less expensive than the hospital, and yet mostly the you know,
especially the urban hospitals,and yet the ability to get the
payers to recognize that and, toyou know, understand the
savings that's already in pocketand you know, provide some kind
(08:48):
of enhancements to rates.
To address that has been.
It's been tough, it's been verylacking in the market to kind
of get the payers to kind ofbite on that.
Speaker 3 (08:58):
Well, I think there's two things that impact that you
argue with me.
I think the first is is that,when you look at it from a
commercial standpoint, that youknow 75% of the commercial
population self-insured.
So a carrier really is writingchecks out of somebody else's
checking account.
It's not their own money atrisk.
And then the other thing is iswhether people agree with this
(09:20):
or not, that the reality of itis is you talk to care about how
do I sell product?
I've got to have the hospital.
I can't sell product withoutthe hospital.
And so the question is iswhether you have a, you know
whether the hospital isaccepting of ASEs being in their
marketplace or whether they seethem as more predatory and so
they push back against them.
So those are facets in amarketplace that just play out.
Speaker 4 (09:45):
But I will say that I don't know if this is kind of a
glimmer of hope at the end ofthat rainbow.
We now do have the bestinformation we've ever had to at
least make the market and orthe payers aware of that,
because with the hospitalpricing transparency and we
represent hospitals as well, andso this is definitely a
double-edged sword, and you knowsort of think about this from
(10:07):
market to market definitely adouble-edged sword.
And you know sort of think aboutthis from market to market, but
strictly from the perspectiveof an independent practice that
owns an ASC, that the pricingtransparency data, once it moved
from just billed charges topayer-based pricing transparency
data, became the best data setavailable to either, on one hand
, prove to a payer from alegitimate third party
(10:33):
non-antitrust problem kind ofway to prove to a payer how much
savings you're bringing to thetable or, on the other hand, to
be able to show the market howmuch you're able to save a
particular carrier or employeror what have you that between
those two, being able toleverage that information to
(10:53):
either drive volume to anemployer or to drive a
renegotiation and pointed thatat a payer is, I feel like we
are absolutely just scratchingthe surface of being able to use
that data appropriately tobenefit one of those two,
because I'm either going todrive volume by being Walmart or
Target although I hate theanalogy of that or I've got to
(11:14):
be able to drive pricing up bybeing able to show that I'm
providing the same qualityservice as a hospital for a
third of the price.
That one of those two has to betrue if you leverage that data
appropriately.
Speaker 3 (11:27):
So let me ask you this, michael.
So think about this now.
One of the challenges that youhave as an ASC and I'll use the
analogy with the hospital, thereal challenge with an ASC today
that's positioned on is if yougo back into the payer with that
information and you say, allright, I can save you money, I
(11:48):
can do these procedures for lesscost.
The real challenge that theyget faced with is, even if a
payer wants to address it andwants to adopt that, what keeps
them from then?
But if I'm going to do that,I'm going to take a bite out of
your physician side, out of yourphysician reimbursement.
Historically speaking, like andI've always wondered about this
(12:08):
, particularly in the ruralmarkets I never understood why
ambulatory service centers don'tcoalesce and have like an IPA
that that can separate the, the,the contracting with a payer,
because otherwise you're alwaysput your physician portion
(12:31):
portion.
If you can separate itcompletely out, then you're only
addressing the ASC call side orthe contractual side of it, and
you're leaving your physicianside alone, so that the payer
sees them separately, would you?
agree with that.
Speaker 4 (12:41):
But I think the issue is more core than that.
Where I feel like our effortstend to break down first are
that when we're in front of thepayer with a high-quality ASC,
the comparison point from apricing perspective that the
payer wants to make is this ASCversus other ASCs.
(13:02):
The pricing comparison we wantthem to make is this ASC versus
the hospital that these doctorswould be taking those cases to
if they weren't doing the casesin the ASC.
And it is.
It's been heretofore fairlydifficult to get the payers to
cross over that line, even whenyou know they're driving massive
(13:24):
amounts of savings betweenthose two, two sets of numbers,
between those two sets ofnumbers, especially now that we
have the public data set to kindof prove that out.
Whatever that magic sauce is tomake the payer understand it
from the true savingsperspective that's out there.
Because the only rationale Ican come up with is that the
(13:47):
payer must believe that if theymove together the pricing of
hospital outpatient surgicalservices and ASC services closer
together, that the ASC settingis just going to drive all kind
of extra volume through thereand ramp up that volume so much
that the savings are worn awayby existing volume that's now
(14:09):
paid way way higher.
I don't understand that because,again, you know you well know,
john the ASCs that we serve aretraditionally L&R.
That that practice owns thatASC.
It's their volume getting fromA to B.
Therefore it's not a typicallya certificate of need ASC that
(14:32):
is taking cases from a wholebunch of outside surgeons in the
market.
It's usually that one practice.
And so the idea that somehow alittle bit better pricing is
going to drive massive amountsof additional volume through
there, it doesn't seem like itbears any sense of reality.
Volume through there, itdoesn't seem like it bears any
(14:53):
sense of reality.
And yet getting the payer tothink in terms of the savings of
the shifted cases versus justthe comparison point of other
ASCs has been a real challengefor us.
Speaker 3 (15:01):
I get it and I know we got to move on.
I still like the idea of ASCs,considering how to coalesce,
only because in today's worldwho contracts is not always the
same.
The same person that contractsfor the physician may not be the
same person that contracts forASCs and so forth and so I think
of having that message andbeing able to take it in a
(15:21):
bigger geography.
I think has some opportunitiesthere, but I know we have to
move on from that.
Speaker 4 (15:27):
Before we do.
I agree with that, and nothingI was saying previously really
kind of runs against that.
I think, just like it has madesense for physicians to come
together or hospitals to cometogether, whether or not it's
clinically integrated or not,even if you're just sort of
solving logistical issues on thepayer side in order to
(15:49):
facilitate, you know, some formof better contracting out there,
I think all that's absolutelylegitimate, I mean obviously
within the context of, you know,legal antitrust compliant kind
of mannerisms with all that.
Speaker 2 (16:05):
All right, great, let's kind of pivot a little bit
.
We've talked a lot ofbackgrounds in the ASC market.
Now let's take a couple oftopics and kind of look forward.
You guys hit on the points ofcomparing the hospital patient
departments, reimbursementmechanisms, differences between
those areas and ASCs.
Speak to what?
If an ASC administrator islistening, physician is
(16:27):
listening today, what sort ofstrategies would you tell them
to look forward to, given thosediscrepancies?
And if you will speak to howtheir ASC fits into the various
value-based care models that areout there and those that you
see coming down the pipe?
Speaker 3 (16:44):
This is John again.
I'll sort of start out and thenMike and just sort of add in
his thoughts on this.
I think, realistically, if youlook and I think it varies by
state there are certainly statesthat are more progressive and
have evolved more, has much morespecific capitated models in
terms of a lot of their MA andvalue-based models.
(17:06):
Value-based really is at itsinfancy.
While payers are trying tocreate some models, most of it
is all based on cost-basedmodels versus actual care or
savings, things of that nature,and so the reality of it is is
their focus is primary carephysicians and so even the
(17:31):
venture capitalists that havefunded these models.
They're really all about how doyou get attribution and where
does that attribution come from?
And that comes from yourprimary care base.
But if I was an ASC now this isJohn's perspective and Mike can
comment on this but if I was anASC, I would think in today's
model what I would look for is Iwould look around and see if
I've got core primary carepractices that are heavily
(17:53):
involved in value-based care,and most of that is going to be
in the traditional ACO modelsred, white and blue Medicare
that first came out and it'sgoing to be in the Medicare the
fast growing Medicare Advantage,and then it's going to be in
the Medicare that the fastgrowing Medicare Advantage and
then it's going to be in some ofthe commercial platforms as
well.
Most noticeably, I would say,blue Cross is a PHC program is
(18:15):
another place where there'sgoing to be some significant
growth.
And if I looked in those models,I would.
I would say I would work withthose providers and say, ok, I
may not participate in thefinancial aspects of it, but
here's what I can do.
I can.
I can.
I can be in a bettercommutative place than you're
going to be Maybe with otherinstitutions that are in that
marketplace or other agencies.
(18:35):
I can get your patients in on atimely manner.
I can communicate to you on atimely manner.
I can provide the clinicalresponses back to you in a
timely manner.
I can provide the clinicalresponses back to you in a
timely manner, all the thingsthat they need today to be
effective in managing theirattribution.
And but what the real benefit ofthis?
(18:56):
And I go back, and I thinkMichael made such an astute
point about this earlier.
But the real benefit to me foran ASC is now I'm going to get a
definitive referral source.
I am no longer depending on mypatients to be what feeds my ASC
.
I've got a definitive referralsource and it's human nature for
a physician.
If you're taking my Medicarepatients, I'm going to send you
all of my patients.
I don't tend to send themspotty.
(19:17):
I tend to find a place that I'mcomfortable with and that I
have a lot of faith in andthat's where I'm going to send
them.
And so back to that point ofMichael about where you're going
to get your patients from.
This is an opportunity for you.
If you have value based modelsin your community with your
primary care, how youcollaborate with them for that
(19:37):
base.
And I will say this if they'rein your, if they're in your
community and I do think this isindicative of the rural
communities don't always lookstrictly to the independent
primary care.
You absolutely have to.
But don't forget that RHCs andFQs, or particularly FQs,
they're FQs that participate inthese value-based models, so
(19:59):
they're a great resource tocollaborate with as well.
Speaker 4 (20:03):
Stated differently what I hear you saying.
I think this is absolutely truein the market that for surgical
specialists right now thevalue-based play is really a
fee-for-service play wrapped invalue-based clothing.
Because in order to grow myreferral base and the sort of
(20:24):
the attractiveness of mypractice up until now it's been
you know, my general reputationin the market probably not based
with a whole lot of qualitydata per se, because it's more
relationally based on all that.
And then it's the interactivitybetween my staff from the
primary care staff in order tomake it easy to get a patient in
(20:44):
and the right information goesback over that.
At the end of the day, that'sbeen our basic attractiveness to
a primary care.
Now there's a whole new angleof how I can be attractive to
them by understanding theirvalue base play and it's not so
much about me horning my way into get part of those dollars,
but it's me being such aneffective partner in that,
(21:06):
understanding the goals thatyou're supposed to meet, primary
care physician, such that if Iassist you in that and I help
you meet your goals, then Iought to be your natural play on
the other side.
I don't think anybody wouldpush back on that because, to
the degree that becomes eitherquality-based or cost-based,
that's exactly how the programought to be working, that I need
to be held accountable forhigher quality and lower overall
(21:29):
cost.
To the degree I understand thatand that makes me an attractive
receiver of primary care volume,that is, you know, that's the
brand new version of thephysician liaison service that
we traditionally have done outthere to make sure our primary
care practices are happy with us.
(21:50):
There's just a whole other anglefor the ones that are sort of
diving in the deep end of thepool of value-based world.
That will be for me to have aplatform to be attractive to you
and I think, john, like you'resaying, I don't think Georgia's
on the cutting edge of this.
I think we lag behind otherstates and I think there's other
places to look at in thecountry that have probably been
farther developed with this forus to look at and go.
(22:12):
What does it really look liketo be a really effective surgeon
that has an ASC, but a reallyeffective surgeon growing my
referral base by being effectivewith helping a primary care
group or groups meet theirmeasurements under this and that
, whether or not it's tomorrowor a year from now or two years
from now, five years from now,that is going to be.
(22:32):
I think, from our perspective,that's going to be one of the
lead, if not the lead way thatspecialists get their volume in
the future.
Speaker 3 (22:42):
Yeah, you know, mike, I'm going to say this.
I know we got to go, but I amgoing to say this because I
think you touched on it again.
You know we are underdeveloped.
We talk about being in afee-for-service as far as, as
you said, wrapped in avalue-based clothing, but the
reality of it is is when thesenew models come in, absolutely
come and make no mistake aboutit.
(23:05):
There are organizations that arealready here.
They're going to be more comingand the reason that they come
here is it's a virgin marketthat they just feel like getting
in on the front edge is what'sgoing to make them as successful
.
They have been in other states,but in their models they
gravitate out of thefee-for-service and into the
capitated models and that'swhere they want to drive
everybody.
So, as they're trying to driveproviders into those capitated
(23:26):
models, being a referral basethat's cost effective and trend
and going back to your point,pricing transparency will be
incredibly important in this tobe able to demonstrate to these
plans and these other providers.
Here's my cost for these set ofservices and these are the
(23:46):
things that I can do to impactyour dollars, and I think you'll
see tighter to two points.
I think you'll see tighterrelationships between
specialists, particularly withASCs and primary care, because
they're going to be bound by thecost of that plan, because
again they're going to drive ittowards capitation.
(24:07):
But great, great point.
Speaker 2 (24:10):
All right.
Great dialogue fills withhelpful information for
providers to take forward.
We hope the audience enjoyedthe dialogue format versus our
historical Q&A format.
We found it very productive andwe certainly look to pick back
up next time around as we startdiving into primary care and
specialist trends, just as wedid with ASCs today.
So with that, thanks John,thanks Mike.
(24:32):
Appreciate y'all's time today.
Speaker 1 (24:34):
You've been listening to Beyond the Stethoscope,
Vital Conversations with SHP, aproduction of Strategic
Healthcare Partners.
Speaker 2 (24:40):
For more information about our podcast, including
back episodes, show notes,transcripts and more, visit our
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Speaker 1 (24:50):
And I know you've heard it before, but please
consider rating our podcast andyour favorite podcast out.
It helps make others aware ofthe show.
Speaker 2 (24:57):
And our podcast wouldn't be possible without our
wonderful team of folks.
Speaker 1 (25:01):
Editing and production assistance by Nyla
Weave and myself, Aaron Higgins.
Speaker 2 (25:06):
And your episode hosts are Aaron Higgins and
myself, Jason Crosby.
Speaker 1 (25:10):
Our social media coordinator is Jeremy Miller.
Speaker 2 (25:13):
Our executive producers are also our
principals Mike Scribner andJohn Crew.
Speaker 1 (25:18):
For more from SHB, consider following us on social
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Speaker 2 (25:24):
As always, thank you for listening and have a great,
wonderful day.
Thank you.
Explored key issues in theambulatory surgery center market
with experts Mike Scribner andJohn Crew.
In this episode, Mike and Johndive into a range of timely
topics, including theimplications of the no Surprises
Act, regulatory and legislativetrends and the growing
influence of Medicare Advantagein ambulatory care.
They also discuss thechallenges and opportunities
(00:40):
presented by traditionalMedicare for independent ASCs,
managing shared care strategiesthat help ASCs navigate the
evolving landscape in 2023 andbeyond.
So, whether you're part of anASC, a healthcare professional
or simply interested in thelatest developments in the
industry, this replay stilloffers valuable insights into
(01:01):
strategies, even in today'smarket.
Tune in to gain a deeperunderstanding of the forces
shaping ambulatory care and stayahead as we revisit this vital
conversation.
Speaker 2 (01:17):
Hey everyone, I'm Jason Crosby with Strategic
Healthcare Partners and yourhost for today's episode where
we are kicking off season two.
I am joined by SHP principalsMike Scribner and John Crew,
where today we will discussmarketplace trends with
ambulatory surgery centers, orASCs.
So with that, let's just jumpright into the conversation.
John, you start us off.
Take a brief look back atrecent trends in the ASC market.
(01:40):
What has impacted such thingssuch as value-based care, no
Surprises Act or otherregulatory changes as of late
for ASCs?
Speaker 3 (01:48):
Well, jason, thanks for asking, and again, this is
John Crew.
We do want to take a moment totake a look back at all the
things that have happened or arehappening as it relates to ASCs
, particularly in thevalue-based care world, the no
Surprises Act, price andtransparency.
There's a lot of regulations, Iwould say, and Mike can
certainly comment to this.
(02:09):
I would say that when a lot offolks were building their ASCs,
there was an opportunity aboutwhether or not they wanted to be
in networks, stay out ofnetwork, what worked best, a lot
of people trying to determinethe financial situations for
their ASC.
And I think we're seeing asignificant change in the
marketplace now that's affectingall of that, particularly as it
(02:30):
relates to Medicare Advantage.
And I say that because and Mikecan certainly comment here I
would say that we're seeing fromour client base, the fastest
growing clinical population outthere now is Medicare Advantage.
Historically speaking, we for along time really, we stayed in
the red, white and blue model,Medicare sort of creeped along
(02:53):
and kept growing.
But now we see in a lot ofcases where their client bases
were now as far as a Medicarepopulation in and of itself,
that nearly two thirds of theirpopulation is Medicare Advantage
now, where just a few years agothat would have been the exact
opposite and there'd been morered, white and blue.
Any thoughts around that,michael?
(03:13):
Yeah?
Speaker 4 (03:15):
John, this is Mike.
I guess kind of to step backinto your opening comment, the
landscape from an ASCperspective, from our
perspective, a managed careperspective, has changed
drastically over the last sevenor eight years.
You go back seven, eight, tenyears and, just like you said in
your opening comment, that alot of ASCs, where they're fed
(03:40):
by their practice ownership andit kind of breaks down the
connectivity of managed care ofthe referral source.
When the referral source isbuilt in there's really no
reason to have to contract inorder to achieve the volume.
Therefore it became more of afinancial game of what made
sense to be in versus out ofnetwork.
But just like you're alludingto, there's been a whole host of
(04:04):
factors that kind of dampenedthat ability over the past
several years the emergence ofhigh deductible plans, the
rollout of the exchange plans,that kind of put that on
steroids and kind of moved uphigh deductible plans into kind
of more of the normalcy.
You kind of couple that with nosurprises act that we were
commenting on that between thefact that it imposes a
(04:30):
prohibition against balancedbilling, coupled with kind of
built-in federally ordainedmechanisms to put a value-based
price on it that lowers the gapbetween in versus out of network
potential reimbursement thatalso kind of shut down angles of
benefit for being out ofnetwork in the first place,
(04:50):
which has kind of led the ASCcommunity to have to go back and
, you know, on a payer by payer,product line by product line
basis, have to redeterminewhether or not to get a network.
And a lot of times at this pointthe answer is yes, that they do
need to go back and build acontracted portfolio in order to
maintain the ability to seethose patients.
(05:11):
And then, adding on the pointthat you were just talking about
with the Medicare Advantageworld, again you go back seven
years ago and, just like yousaid, 10% of the Medicare
population, 15% of the Medicarepopulation, is in a Medicare
Advantage plan at that point.
Now, with it being over half,maybe as much as two-thirds,
like you were talking about, andas those plans have rolled from
(05:34):
all PPO orientation and fullout-of-network benefits and all
those kinds of deployments, thatagain made it where you didn't
really have to contract in orderto play.
Now we're at a point wherethere's more HMO in the market,
no out-of-network benefit HMOsin the market, such that again
it's tougher to get your patientfrom practice to ASC, no matter
(05:57):
what the payer source is now inthe current world, and so it's
changed the world dramatically.
Speaker 3 (06:04):
You know that's a great point.
Michael, you touched onsomething that I think it's too
easy to lose sight of and it'stoo easy for me to lose sight of
as well is the fact that whenyou think about a practice, that
open ASC and I'm not trying tobe redundant, but the fact that
you really fill that ASC up withyour own patients, and today
now you're going to have to lookexternal about how you get your
(06:25):
patients and I know we'll talkabout value-based care in a
minute but I think about all thegrowth of the vendors that are
coming into the marketplaces.
You think about our friends inFlorida where we've had
aggressive MA growth andaggressive MA value-based growth
, and now how they have to workwith others to get their
referral base, and so that's achange that we're going to see.
(06:47):
We'll talk more about, butthat's a change we're seeing and
I think that's a significantchange and just as important as
understanding.
That is, if you're going tohave to move in that flow of
understanding that I'm now goingto have to contract more, it's
got to be essential to an ASCnow to financially understand
what that means to them, becausethere's a reasonable likelihood
(07:08):
that you're simply going toreprice your patient population.
It may not be a new population,you're simply going to reprice
it, and understanding thefinancial impact of that to your
ASC I think is essential tothat.
Speaker 4 (07:23):
Which, as of today has and John, jump back in and
tell me your experience.
As of today, our generalreaction in the market has been
that because these market forcesare kind of pushing pricing
down and limiting the referralsources to the point where I
have to go back and contract toget in, which also kind of
(07:44):
serves to depress the pricing inthe first place, the basic
practice reaction is we'll haveto cram more volume through
there at the lower pricing inorder to retain what I had
before, which is a.
That's a tough place to bebecause that's a, you know, now
I have to.
There's only so much volume, asyou always talk about, and that
(08:04):
I have to.
You know I much volume, as youalways talk about, and that I
have to.
You know I'm already attemptingto do as much as I can in the
ASC setting and not in thehospital setting in order to
kind of feed the practices onmechanism.
But it's a tough place to beright now.
And what has always sort ofperplexed me is that From an ASC
(08:26):
perspective, the same care istypically being rendered much
less expensive than the hospital, and yet mostly the you know,
especially the urban hospitals,and yet the ability to get the
payers to recognize that and, toyou know, understand the
savings that's already in pocketand you know, provide some kind
(08:48):
of enhancements to rates.
To address that has been.
It's been tough, it's been verylacking in the market to kind
of get the payers to kind ofbite on that.
Speaker 3 (08:58):
Well, I think there's two things that impact that you
argue with me.
I think the first is is that,when you look at it from a
commercial standpoint, that youknow 75% of the commercial
population self-insured.
So a carrier really is writingchecks out of somebody else's
checking account.
It's not their own money atrisk.
And then the other thing is iswhether people agree with this
(09:20):
or not, that the reality of itis is you talk to care about how
do I sell product?
I've got to have the hospital.
I can't sell product withoutthe hospital.
And so the question is iswhether you have a, you know
whether the hospital isaccepting of ASEs being in their
marketplace or whether they seethem as more predatory and so
they push back against them.
So those are facets in amarketplace that just play out.
Speaker 4 (09:45):
But I will say that I don't know if this is kind of a
glimmer of hope at the end ofthat rainbow.
We now do have the bestinformation we've ever had to at
least make the market and orthe payers aware of that,
because with the hospitalpricing transparency and we
represent hospitals as well, andso this is definitely a
double-edged sword, and you knowsort of think about this from
(10:07):
market to market definitely adouble-edged sword.
And you know sort of think aboutthis from market to market, but
strictly from the perspectiveof an independent practice that
owns an ASC, that the pricingtransparency data, once it moved
from just billed charges topayer-based pricing transparency
data, became the best data setavailable to either, on one hand
, prove to a payer from alegitimate third party
(10:33):
non-antitrust problem kind ofway to prove to a payer how much
savings you're bringing to thetable or, on the other hand, to
be able to show the market howmuch you're able to save a
particular carrier or employeror what have you that between
those two, being able toleverage that information to
(10:53):
either drive volume to anemployer or to drive a
renegotiation and pointed thatat a payer is, I feel like we
are absolutely just scratchingthe surface of being able to use
that data appropriately tobenefit one of those two,
because I'm either going todrive volume by being Walmart or
Target although I hate theanalogy of that or I've got to
(11:14):
be able to drive pricing up bybeing able to show that I'm
providing the same qualityservice as a hospital for a
third of the price.
That one of those two has to betrue if you leverage that data
appropriately.
Speaker 3 (11:27):
So let me ask you this, michael.
So think about this now.
One of the challenges that youhave as an ASC and I'll use the
analogy with the hospital, thereal challenge with an ASC today
that's positioned on is if yougo back into the payer with that
information and you say, allright, I can save you money, I
(11:48):
can do these procedures for lesscost.
The real challenge that theyget faced with is, even if a
payer wants to address it andwants to adopt that, what keeps
them from then?
But if I'm going to do that,I'm going to take a bite out of
your physician side, out of yourphysician reimbursement.
Historically speaking, like andI've always wondered about this
(12:08):
, particularly in the ruralmarkets I never understood why
ambulatory service centers don'tcoalesce and have like an IPA
that that can separate the, the,the contracting with a payer,
because otherwise you're alwaysput your physician portion
(12:31):
portion.
If you can separate itcompletely out, then you're only
addressing the ASC call side orthe contractual side of it, and
you're leaving your physicianside alone, so that the payer
sees them separately, would you?
agree with that.
Speaker 4 (12:41):
But I think the issue is more core than that.
Where I feel like our effortstend to break down first are
that when we're in front of thepayer with a high-quality ASC,
the comparison point from apricing perspective that the
payer wants to make is this ASCversus other ASCs.
(13:02):
The pricing comparison we wantthem to make is this ASC versus
the hospital that these doctorswould be taking those cases to
if they weren't doing the casesin the ASC.
And it is.
It's been heretofore fairlydifficult to get the payers to
cross over that line, even whenyou know they're driving massive
(13:24):
amounts of savings betweenthose two, two sets of numbers,
between those two sets ofnumbers, especially now that we
have the public data set to kindof prove that out.
Whatever that magic sauce is tomake the payer understand it
from the true savingsperspective that's out there.
Because the only rationale Ican come up with is that the
(13:47):
payer must believe that if theymove together the pricing of
hospital outpatient surgicalservices and ASC services closer
together, that the ASC settingis just going to drive all kind
of extra volume through thereand ramp up that volume so much
that the savings are worn awayby existing volume that's now
(14:09):
paid way way higher.
I don't understand that because,again, you know you well know,
john the ASCs that we serve aretraditionally L&R.
That that practice owns thatASC.
It's their volume getting fromA to B.
Therefore it's not a typicallya certificate of need ASC that
(14:32):
is taking cases from a wholebunch of outside surgeons in the
market.
It's usually that one practice.
And so the idea that somehow alittle bit better pricing is
going to drive massive amountsof additional volume through
there, it doesn't seem like itbears any sense of reality.
Volume through there, itdoesn't seem like it bears any
(14:53):
sense of reality.
And yet getting the payer tothink in terms of the savings of
the shifted cases versus justthe comparison point of other
ASCs has been a real challengefor us.
Speaker 3 (15:01):
I get it and I know we got to move on.
I still like the idea of ASCs,considering how to coalesce,
only because in today's worldwho contracts is not always the
same.
The same person that contractsfor the physician may not be the
same person that contracts forASCs and so forth and so I think
of having that message andbeing able to take it in a
(15:21):
bigger geography.
I think has some opportunitiesthere, but I know we have to
move on from that.
Speaker 4 (15:27):
Before we do.
I agree with that, and nothingI was saying previously really
kind of runs against that.
I think, just like it has madesense for physicians to come
together or hospitals to cometogether, whether or not it's
clinically integrated or not,even if you're just sort of
solving logistical issues on thepayer side in order to
(15:49):
facilitate, you know, some formof better contracting out there,
I think all that's absolutelylegitimate, I mean obviously
within the context of, you know,legal antitrust compliant kind
of mannerisms with all that.
Speaker 2 (16:05):
All right, great, let's kind of pivot a little bit
.
We've talked a lot ofbackgrounds in the ASC market.
Now let's take a couple oftopics and kind of look forward.
You guys hit on the points ofcomparing the hospital patient
departments, reimbursementmechanisms, differences between
those areas and ASCs.
Speak to what?
If an ASC administrator islistening, physician is
(16:27):
listening today, what sort ofstrategies would you tell them
to look forward to, given thosediscrepancies?
And if you will speak to howtheir ASC fits into the various
value-based care models that areout there and those that you
see coming down the pipe?
Speaker 3 (16:44):
This is John again.
I'll sort of start out and thenMike and just sort of add in
his thoughts on this.
I think, realistically, if youlook and I think it varies by
state there are certainly statesthat are more progressive and
have evolved more, has much morespecific capitated models in
terms of a lot of their MA andvalue-based models.
(17:06):
Value-based really is at itsinfancy.
While payers are trying tocreate some models, most of it
is all based on cost-basedmodels versus actual care or
savings, things of that nature,and so the reality of it is is
their focus is primary carephysicians and so even the
(17:31):
venture capitalists that havefunded these models.
They're really all about how doyou get attribution and where
does that attribution come from?
And that comes from yourprimary care base.
But if I was an ASC now this isJohn's perspective and Mike can
comment on this but if I was anASC, I would think in today's
model what I would look for is Iwould look around and see if
I've got core primary carepractices that are heavily
(17:53):
involved in value-based care,and most of that is going to be
in the traditional ACO modelsred, white and blue Medicare
that first came out and it'sgoing to be in the Medicare the
fast growing Medicare Advantage,and then it's going to be in
the Medicare that the fastgrowing Medicare Advantage and
then it's going to be in some ofthe commercial platforms as
well.
Most noticeably, I would say,blue Cross is a PHC program is
(18:15):
another place where there'sgoing to be some significant
growth.
And if I looked in those models,I would.
I would say I would work withthose providers and say, ok, I
may not participate in thefinancial aspects of it, but
here's what I can do.
I can.
I can.
I can be in a bettercommutative place than you're
going to be Maybe with otherinstitutions that are in that
marketplace or other agencies.
(18:35):
I can get your patients in on atimely manner.
I can communicate to you on atimely manner.
I can provide the clinicalresponses back to you in a
timely manner.
I can provide the clinicalresponses back to you in a
timely manner, all the thingsthat they need today to be
effective in managing theirattribution.
And but what the real benefit ofthis?
(18:56):
And I go back, and I thinkMichael made such an astute
point about this earlier.
But the real benefit to me foran ASC is now I'm going to get a
definitive referral source.
I am no longer depending on mypatients to be what feeds my ASC
.
I've got a definitive referralsource and it's human nature for
a physician.
If you're taking my Medicarepatients, I'm going to send you
all of my patients.
I don't tend to send themspotty.
(19:17):
I tend to find a place that I'mcomfortable with and that I
have a lot of faith in andthat's where I'm going to send
them.
And so back to that point ofMichael about where you're going
to get your patients from.
This is an opportunity for you.
If you have value based modelsin your community with your
primary care, how youcollaborate with them for that
(19:37):
base.
And I will say this if they'rein your, if they're in your
community and I do think this isindicative of the rural
communities don't always lookstrictly to the independent
primary care.
You absolutely have to.
But don't forget that RHCs andFQs, or particularly FQs,
they're FQs that participate inthese value-based models, so
(19:59):
they're a great resource tocollaborate with as well.
Speaker 4 (20:03):
Stated differently what I hear you saying.
I think this is absolutely truein the market that for surgical
specialists right now thevalue-based play is really a
fee-for-service play wrapped invalue-based clothing.
Because in order to grow myreferral base and the sort of
(20:24):
the attractiveness of mypractice up until now it's been
you know, my general reputationin the market probably not based
with a whole lot of qualitydata per se, because it's more
relationally based on all that.
And then it's the interactivitybetween my staff from the
primary care staff in order tomake it easy to get a patient in
(20:44):
and the right information goesback over that.
At the end of the day, that'sbeen our basic attractiveness to
a primary care.
Now there's a whole new angleof how I can be attractive to
them by understanding theirvalue base play and it's not so
much about me horning my way into get part of those dollars,
but it's me being such aneffective partner in that,
(21:06):
understanding the goals thatyou're supposed to meet, primary
care physician, such that if Iassist you in that and I help
you meet your goals, then Iought to be your natural play on
the other side.
I don't think anybody wouldpush back on that because, to
the degree that becomes eitherquality-based or cost-based,
that's exactly how the programought to be working, that I need
to be held accountable forhigher quality and lower overall
(21:29):
cost.
To the degree I understand thatand that makes me an attractive
receiver of primary care volume,that is, you know, that's the
brand new version of thephysician liaison service that
we traditionally have done outthere to make sure our primary
care practices are happy with us.
(21:50):
There's just a whole other anglefor the ones that are sort of
diving in the deep end of thepool of value-based world.
That will be for me to have aplatform to be attractive to you
and I think, john, like you'resaying, I don't think Georgia's
on the cutting edge of this.
I think we lag behind otherstates and I think there's other
places to look at in thecountry that have probably been
farther developed with this forus to look at and go.
(22:12):
What does it really look liketo be a really effective surgeon
that has an ASC, but a reallyeffective surgeon growing my
referral base by being effectivewith helping a primary care
group or groups meet theirmeasurements under this and that
, whether or not it's tomorrowor a year from now or two years
from now, five years from now,that is going to be.
(22:32):
I think, from our perspective,that's going to be one of the
lead, if not the lead way thatspecialists get their volume in
the future.
Speaker 3 (22:42):
Yeah, you know, mike, I'm going to say this.
I know we got to go, but I amgoing to say this because I
think you touched on it again.
You know we are underdeveloped.
We talk about being in afee-for-service as far as, as
you said, wrapped in avalue-based clothing, but the
reality of it is is when thesenew models come in, absolutely
come and make no mistake aboutit.
(23:05):
There are organizations that arealready here.
They're going to be more comingand the reason that they come
here is it's a virgin marketthat they just feel like getting
in on the front edge is what'sgoing to make them as successful
.
They have been in other states,but in their models they
gravitate out of thefee-for-service and into the
capitated models and that'swhere they want to drive
everybody.
So, as they're trying to driveproviders into those capitated
(23:26):
models, being a referral basethat's cost effective and trend
and going back to your point,pricing transparency will be
incredibly important in this tobe able to demonstrate to these
plans and these other providers.
Here's my cost for these set ofservices and these are the
(23:46):
things that I can do to impactyour dollars, and I think you'll
see tighter to two points.
I think you'll see tighterrelationships between
specialists, particularly withASCs and primary care, because
they're going to be bound by thecost of that plan, because
again they're going to drive ittowards capitation.
(24:07):
But great, great point.
Speaker 2 (24:10):
All right.
Great dialogue fills withhelpful information for
providers to take forward.
We hope the audience enjoyedthe dialogue format versus our
historical Q&A format.
We found it very productive andwe certainly look to pick back
up next time around as we startdiving into primary care and
specialist trends, just as wedid with ASCs today.
So with that, thanks John,thanks Mike.
(24:32):
Appreciate y'all's time today.
Speaker 1 (24:34):
You've been listening to Beyond the Stethoscope,
Vital Conversations with SHP, aproduction of Strategic
Healthcare Partners.
Speaker 2 (24:40):
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Speaker 2 (24:57):
And our podcast wouldn't be possible without our
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Speaker 1 (25:01):
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Weave and myself, Aaron Higgins.
Speaker 2 (25:06):
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