5 Key Metrics that Profitable ASCs Track

Scott Nation

President, Velocity Outpatient Services

There were more than 6,000 Medicare-licensed ambulatory surgical centers (ASCs) in the United States by the end of Q4 2022 with 80 percent of surgeries now performed in an outpatient setting. Judging by the number of Becker’s ASC Review articles each week announcing new ASCs, I’d say there are hundreds more in development, including two that Velocity Outpatient Services is building: the Colorado Outdoors Medical Center and a medical office building associated with Jackson Hospital in Marianna, FL.

Just as importantly, “…overall revenue growth for the ASC market is expected to outpace growth in the number of facilities driven by the expected migration of cardiac, spine and orthopedic cases from hospital-based settings to ASCs.”

As anyone who manages an ASC knows all too well, operators need to focus on five key metrics to be profitable.

  1. Know your “per minute costs”

Running an operating room is more than the cost of the surgical team. Instead, be sure to include:

  • The work prior to surgery – scheduling, pre-authorization, materials manager for supplies, equipment and instrumentation needs,
  • Day of costs – front office, PreOp, IntraOp, PostOp and SPD personnel
  • Follow up personnel – PostOp calls, labs and path reports

  1. Determine the cost of your day of surgery cancellations

The goal is your day of surgery cancellations are less than one percent of total case volume. To meet this goal, know the number of patient touch points prior to surgery day as well as pre-authorization, pre-certification and case costing, and the number and cost of day of surgery cancellations.

  1. Understand your operating room utilization

Two key questions:

  • Should I compress cases into one operating room and close another one?
    • To answer this question, you need to know pre-authorizations, pre-certifications and case costing before the day of surgery.
    • You also will want to know how staff are utilized during downtime, e.g., when waiting for a case to start, assisting other teams with breaks, completing pre/post op patient calls, chart reviews, completing required educational needs, or send them home if not actively functional. Consider a PRN staff pool.
  • What is the reimbursement/profitability for each case? That means you need to know your case costing, minor case costs versus major case cost, related to the equipment, supplies and staffing needed to support the case and total time required.

  1. Track late starts and overruns (minutes over the procedure’s scheduled time

Know why there was a late start, e.g., patient work up took longer than expected, physician or representative arrived late, staffing issues, previous case ran over, time over time (TOT) not incorporated, lack of instruments, etc. Determine the number of minutes per case and by provider for late starts and overruns.

  1. Know your ASCs’ clinical performance data

Familiarize yourself with your facilities key quality metrics to better understand the value and performance of your processes and services. Tracking the overall performance of your services such as Patient, Physician & Staff satisfaction results, and patient outcomes, percentage of SSI’s, complications, hospital/emergency room visit within 24 hours or seven days of discharge, the number of burns, falls, wrongs, or death, identify opportunities for improvement.

Just as importantly, use external benchmarking to compare your outcomes to local, state and national rates. The ASC space is a very competitive landscape, knowing how you compare against your local competition’s results helps you understand your center’s value proposition within your market.