By: Linda S. Peterson, Founder and CEO
Executive Solutions for Healthcare, LLC, Scottsdale, Arizona
A boutique firm specializing in start-up, licensure, and accreditation of healthcare facilities
Introduction
Opening a surgery center is a significant undertaking that requires careful planning, project direction, regulatory compliance, and strategic decision-making. Below is a brief overview of some of the key considerations for starting a successful ambulatory surgery center (ASC) in the United States.
If you are thinking about an office-based surgery center or even an outpatient imaging center, most of this information is also relevant.
Keep in mind that the best time to call in a consultant is when you are pondering starting this business, not after you have already rented space. Often, the building you choose is not conducive to this type of facility, or you find out you need more—or less—space than you thought.
Feasibility Analysis
Unfortunately, this is often not when clients first call, yet it is the most vital step in the whole process. You may be an established physician who knows how many cases you perform per year but typically do not know the costs related to building and running a Medicare (CMS)-certified and/or state-licensed ambulatory surgery center.
A feasibility study will help estimate costs, the amount of space needed, how many ORs are needed based on specialty and case volumes, project revenues, staffing needs, payer mix, and, finally, determine the financial viability of your surgery center. This data can help you decide if you may need to partner with other surgeons to cover costs or increase profits. It can also serve as a key piece of the business plan essential to obtain financing or attract physician partners.
Studies have shown that two-OR centers are typically more profitable than centers with more operating rooms, as the best problem to have is being at full capacity, versus always trying to fill up the last room.
Location Selection and Facility Design
We work with local, preferably healthcare-specialized real estate agents, listing the requirements to help you choose a location that is accessible to patients and meets zoning requirements for medical facilities. We work with architects and contractors experienced in healthcare construction to inspect the space before the lease is secured or design a facility that will comply with all relevant building codes, safety standards, state license requirements, accrediting bodies, and Medicare (CMS) regulations.
Often, an existing building can suffice, provided it is a newer building with sprinkler systems and room somewhere outside the building to accommodate a backup generator. Otherwise, costs can quickly multiply to bring the space up to code.
Supply and Equipment Procurement
Contracting with a GPO (group purchasing organization) for better pricing early in the process is extremely helpful. We also recommend reputable vendors for equipment purchasing and ongoing maintenance.
Clinical and Operational Excellence
Hiring experienced surgery leadership and staff on the clinical and administrative sides is vital when starting up a center. Surgery centers operate differently and often more efficiently than hospitals. Also, the last place to skimp on salaries is the front desk. Remember that these are the first people your patients interact with by phone or in person. They need to be knowledgeable, compassionate, and able to think on their feet.
Orientation, competency testing, and adherence to policies and procedures are not only required but necessary for the ongoing success of the center.
Technology and Billing
Electronic Health Record software (EHR) is essential to streamline patient care and administrative processes, as is implementing an efficient billing and revenue cycle management system to ensure timely payments and financial sustainability. The best ASC software providers offer integrated systems that provide everything from patient preregistration and discharge to inventory management and charge capture.
Utilizing a reputable outside billing company versus hiring staff when you first start up is advisable to ensure cash flow is optimized, as they only get paid when you do.
You will need at least 6–10 months of working capital while setting up the center and waiting for insurance contracts to be established within their systems. Believe it or not, Medicare may be the first to pay you!
Marketing
A well-designed website is vital to your business, and the content will help meet several regulatory requirements. Patients and families want to be comfortable with where they are having their procedure. A “Meet Our Staff” section on the website with photos helps personalize your team.
A marketing strategy is also important to promote your surgery center to physicians, patients, and the broader community. Often, we recommend an ASC representative personally visit referring physicians’ offices to further establish that relationship, particularly with their surgery schedulers.
Conclusion
Starting a surgery center is a complex but rewarding endeavor that can improve access to high-quality surgical care in your community. By following guidance from industry experts, you can lay a strong foundation for a successful and sustainable facility. Hiring experienced, hands-on consultants from day one can get you to the finish line on time and within budget.
