Want to be cost-efficient? Consider these ideas
By Stephen W. Earnhart, MS
Earnhart & Associates
Do you ever compare yourself with others? Do you compare how you look and what you weigh? What about how much you make and what kind of car you drive? What about other things, like your supply cost per case? What are other people paying for the same stuff you buy? Nothing riles us quicker than thinking we have been taken advantage of in some aspect of life.
Well, prepare to compare!
Average supply cost for outpatient surgery knee arthroscopy performed in an ambulatory surgery center (ASC) by an investing surgeon is $375. If you are hospital-based, I can bet you are upset about that one! Chances are yours are almost three times that amount. What about supply cost for cataracts? Including the intraocular lens (IOL), it is about $350 in an ASC via an investing surgeon.
A reader from Chicago sent me an e-mail the other day: "What to you think is the best way to reduce turnaround time in our not-for-profit hospital? We cannot pay bonuses to the staff like the for-profit surgery centers."
Answer: Au contraire. Of course you can bonus your staff in the hospital market. It is so simple I am shocked that not every hospital does it. Simply send your OR teams home when they have finished their elective cases — with full pay! Rotate your staff so it is fair.
Why hospitals continue to reinforce disincentives for productivity confounds me! Why have staff stay the full day to get a full day's pay, rather than given them incentives to finish their cases early (and giving them full pay)?
An ASC from Texas asks, "How much should we be subsidizing anesthesia to provide coverage to our center? They say that they do not make money on our Medicare cases. The current group wants $1,000 per day — even if we do no cases!"
Answer: No one should subsidize anesthesia services. Like all businesses, we make more money on some things than we do on others. Anesthesia does very well on the non-Medicare cases, and that should balance the equation.
A reader in California asks: "What for-profit ASCs have profit sharing for their staff?"
Answer: The smart ones.
Other areas of cost-efficiency for you to consider:
- A well-run, for-profit ASC should never incur overtime.
- Being hospital based is no excuse for being inefficient in time management. So many of the managers I deal with keep saying that. Stop hiding behind that self-imposed barrier.
- Your administrator or department head always should work longer hours than their staff.
- Any nursing position that deals with surgeon complaints should make more than those that do not.
- IOLs for cataracts can cost as low as $45 per lens.
- The ophthalmologist who performs cataract procedures in your ASC also should perform their YAG laser procedures there as well.
- Your operating rooms should never function above 78% of time utilization. Otherwise you lose the ability to "flip-flop" rooms for a more rapid turnover.
(Editor's note: Earnhart & Associates is an ambulatory surgery consulting firm specializing in all aspects of surgery center development and management. Contact Earnhart at 3112 Windsor Road, Suite A-242, Austin, TX. 78703. E-mail: firstname.lastname@example.org. Web: www.earnhart.com.)