Timeshares aren’t just for vacationers anymore. Surgeons in Colorado now have a legal pathway to lease operating rooms in ambulatory surgery centers (ASCs) following approval of that state’s first dual-licensed ASC. It is believed to be the nation’s first such ASC.
Based on a little-known 2014 CMS ruling, Colorado ASCs can operate as legal timeshare properties if they meet all state licensing requirements.
Functional Neurosurgical ASC (FNASC) in Littleton is a joint venture between Littleton Adventist Hospital and David VanSickle, MD, PhD, neurosurgeon/bioengineer. The developer of this new ASC class is Texas-based SurgeryDirect, founded by Beverly Kirchner, BSN, RN, CNOR, CASC.
“Before 2014, when ASCs leased time and space to surgeons and split receipt of technical and surgical service fees, the federal Office of the Inspector General [OIG] deemed this activity to be questionable because it appeared to be business inducement, otherwise defined as fraud and subject to heavy penalties,” Kirchner said. “CMS struggled with ASCs that allowed surgeons to lease operating rooms by the day and bill under the host ASC’s license, Medicare number, and national provider identifier. Since this practice was perceived as fraud, CMS released rules governing the new dual-licensed model.”
Many states have yet to approve dual-licensed surgery centers, primarily because operational requirements are stringent. “Now, where permitted by state law, multiple ASCs — both those that do and do not participate in Medicare — may use the same operating rooms as long as they do not have concurrent or overlapping hours of operation,” Kirchner said.
Among other CMS requirements are the following:
• Each licensed center must have its own policies and procedures, as well as maintain separate, locked patient records and storage of its own surgical supplies and devices, medications, and any other items exclusive to that ASC lessee.
• Each lessee may use the same nursing and ancillary staff under agreement with the staff employer. Each lessee must separately comply with all staff utilization requirements.
CMS regulations are stringent and generally enforced, ASC executives report. Several ASCs around the country are leasing space to physicians in an ad hoc manner, which is risking costly CMS penalties for fraud, they say.
“Physicians who need scalability in their practices now have an option for ASC access without the need for vast investment in real estate, equipment, unneeded staffing, and lengthy time to market,” Kirchner said.
Additionally, leasing outpatient operating rooms is an easier way for young surgeons and single-specialty physicians to acquire ASC space, she said. “We can develop a single-specialty, traditional one-OR center for approximately $3 million,” Kirchner said. “ASCs with up to five ORs run about $10 million. Acquiring a dual-licensed timeshare is far more cost-effective.” The total development cost for the Littleton facility, which was licensed into an existing facility, was less than $500,000, she said.
