Outpatient Surgery Centers Lower Costs

A push to save health care dollars and boost patient experience has propelled growth in outpatient surgery centers in the Tri-Counties and across the nation.

Medicare has also taken steps to include more outpatient procedures on its list of reimbursable services, stoking demand.

“One of the most important things talked about today is the health care dollar,” said Sandra Berreth, director of the surgical service line at Sansum Clinic in Santa Barbara an Ambulatory Surgery Center Association board member. “Surgery centers are one of those answers to saving the health care dollar,” she added.

Surgery centers often have high-skilled teams, and they are “able to deliver that care for a much more reasonable cost than hospitals,” Berreth said. That’s due to the money saved on facilities and size.

More than 80 percent of surgical procedures are performed at outpatient centers, according to a recent analysis by health care economist Beth Munnich. A Sept. 23 report by consulting firm Bain & Company estimated that surgery center procedures will grow 6 to 7 percent a year through 2021. By that account, orthopedic, spine, and cardio procedures are increasing fastest.

On the Central Coast, an increase in both the types and complexity of procedures performed in outpatient centers is trending, CenCal Health’s Director of Provider Services Terri Howell wrote in an email to the Business Times.

“Thanks to advances in surgical techniques, technology, and post-operative care, patients can have their procedures completed in a safe environment that decreases the cost of care, improves health outcomes and allows patients to go home the same day,” she added.

In California, more than 750 surgery centers save Medicare $2.3 billion annually, according to the California Ambulatory Surgery Association. For commercial providers, that number is closer to $5 billion in cost savings due to lower deductibles and co-pays.

“We are seeing an uptick in the numbers of patients who are shopping for the outpatient surgical care they need and choosing ambulatory surgery centers because of the quality and cost savings they provide,” Berreth wrote in an email to the Business Times.

For Medicare patients, ambulatory surgery centers are paid an average of 50 cents on the dollar compared with what hospital outpatient departments are paid for the same procedure, Berreth said. Interest in surgery centers is especially prominent for patients with high-deductible healthcare plans, she said.

Medicare is also evaluating procedures to greenlight for outpatient center reimbursement in 2020, as it does every year, which will cut the price of those surgeries in half in many cases.

Cardiology, orthopedic and spine procedures are on that shortlist of more in-depth procedures, said Trey Parsons, senior vice president of Ambulatory Systems Development, a health care management and investment firm based in Long Beach. It manages the Camarillo Endoscopy Center, which has five physicians.

“Right now, a lot is being added that has not been done in the past,” Parsons said. “Data shows they (these procedures) have been done safely in outpatient settings for years, but we are excited to recognize these significant cost savings.”

Lisa Moore, vice president of clinical services and government relations at Santa Barbara Cottage Hospital, said she has noticed cases being shifted from a hospital to an outpatient setting with increasing frequency.

“For those patients who can get their care in an outpatient environment, it’s so much more desirable,” she said, adding that it cuts costs and allows patients to go home in less than 24 hours. Cottage operated two outpatient surgery centers with a total of 40 physicians in Santa Barbara.

“Patients are really looking for a good experience,” she said, which means quality has become an essential aspect of health care overall and in outpatient centers.

Technology has also played a role in influencing the advancement of ambulatory surgery centers, said a spokeswoman for CASA.

At Camarillo Endoscopy Center, technological tools have eliminated duplications and redundancies in paperwork and electronic health records, Parsons said. A recent technology that center implemented also provides instant results for certain procedures that used to be sent away and waited on for verification, he added.

Written by Annabelle Blair for Pacific Coast Business Times