Cardiovascular Services in the ASC: what lies ahead?

The cardiovascular specialty might just be the ASC industry's next buzz for what's on the horizon of cardiovascular ASCs and OBLs.

Major trends in the cardiovascular ASC space

I receive several calls each month about the conversion of office-based labs to ASC service line development and extension. This is because of the high concentration of peripheral vascular work being done in the OBL environment. There’s new interest in space conversions for those entities that are currently functioning as an OBL.

What is required to add cardiovascular to the ASC if there is already a working OBL arrangement during the off hours of the ASC/OBL hybrid?

Since 2020, this has been driven by the addition of covered cardiovascular and peripheral vascular procedures paid by Medicare through CMS and Advantage Plans.

How will ASCs ride the wave of this trend over the next 10 years?

As payers push the majority of these procedures out of the hospital and health systems facilities to independent, freestanding ASCs, well positioned ASCs will catch the early transition contracts. Hospitals will feel the flyovers in terms of empty inpatient and observation bed days, unfilled surgical block times, and losses of site differentiated payments.

What risks of disruption exist in the cardiovascular ASC space?

Outcomes data. Demonstrating safe care in the ASC environment is paramount to patients and payors. That’s a combination of surgeon technique, nursing care, procedural operations, anesthesia, equipment, and space allocation.

When outcome data is presented, a high level of risk as it relates to patient safety and outcomes is possible. We saw this with DaVinci robots in cardiac surgery where utilization got dialed back in the early 2000s. It was a huge blow to projected trajectories and strategic decisions that were made by the hospitals involved.

How hard is it to assimilate cardiovascular services into an existing ASC?

Expense: The cardiovascular service line as an additional specialty in an existing functioning ASC environment comes with some expense and many clinical considerations. As one who has been an ASC administrator, an OR nurse and started setting up the business development for these additions (both OBL and ASC) in 2019-20, the learning curve was steep. I put in hours of directed learning while actually doing the conversion in situ.

Licensing and Regulations: There are licensing requirements, regulatory requirements, marketing considerations, operational challenges, staffing challenges, technological challenges. I’m an experienced health law paralegal trained to research and dig up background information. It was tough back then, few people to answer phones during COVID WFH times left me with days upon days of unanswered voicemails and emails to state regulators for clarification.

One thing to consider is that each state has or is in development of OBL regulations promulgation. If your consultant goes by the state they are in and not the state your operations occur, beware that you could be wasting time and money. Go with what's published and ask to see the state regulations for yourself!

Price Transparency and Price Integrity: And if the ASC has a well established cash pay and bundled pricing system as we did, pricing integrity and transparency adds another layer of complexity.

Payer contracting: Then there’s the early adopters challenge with contracted payers that don’t have their own systems in place to pay ASCs for these services because they are on the old grouper systems that don’t lend themselves to these services.

The grouper system published back in 2009 (14 years ago!!!!!) was never designed to be used for robotics in orthopedics, cardiovascular services and other trending transitions to the outpatient ASC setting. It’s very square peg and round hole for managed care plans that are stuck in yesterday’s budgets.

But understand one thing if nothing else. Premiums and rate setting budgets happen backstage in actuarial and underwriting departments TWO TO THREE YEARS IN ADVANCE. As such last minute negotiations for price increases to a fee schedule will not serve you well. Planning and timing is everything but will not be easy. Don't wait until you have your lipstick and prom dress on or you'll be sitting on the sidelines if you even get to the prom.

And hospital contracts with DRG rates for these services are also in play and must be disrupted to move to the ASC settings. That doesn’t happen in the health plans in the USA overnight. So just because the ASC is ready for liftoff, if the payers are not ready, it’s like being all dressed up for the prom with no date.

The hospitals that are currently contracted for joint replacements and cardiovascular surgical services that have been moved away or eliminated from their service lines on campus will fight like hell.

They will threaten to disrupt networks if they lose cardiovascular and peripheral vascular services after having already lost joint replacement surgeries and associated bed days. After all, what will they do with all those empty beds? And OR block times? And if we also transition to neutral site of service payments on the employed physician clinic services and Rev Code 510 is eliminated, what will the health system do with all these employed cardiologists and surgeons and orthopedic surgeons? RIF them? You betcha!

This is where the majority of my consulting assignments have come from recently.  Clients want guidance on how to respond strategically and operationally. They want assistance with execution, not just armchair advice and theoretical strategies and tactics.

I get calls from ASCs and health systems alike. My biggest dilemma is an ethical one. I will not advise two competitors in the same market. But now with medical travel and patient redirection flyovers and drivebys, defining a target market and outreach markets is getting extremely complicated. There are very few consultants on the planet who are as well versed in this subject area (or the robotic joint replacement domain) who bring my depth and breadth of expertise.

If you need some assistance or guidance, please call but remember that I cannot help those in a market where one of my 4000+ clients already has me on assignment. I typically put a 90-day pause on a market after project assignment conclusion.

Reach out: 800.727.4160