Legislation helped hospitals and physician practices purchase electronic solutions, but surgery centers were left out of the financial incentives. Fewer surgery centers use electronic medical records and other technological solutions, partly because of that omission, but this trend is changing.
Hospitals are mostly on board with technology: 96% of all non-federal acute care hospitals and 86% of office-based physicians use health information technology, according to 2017 data from the Office of the National Coordinator for Health Information Technology. Before 2009 federal legislation provided some funding for electronic medical records, about one in 10 hospitals used the technology.1
Hospitals and doctors benefited, with financial incentives for electronic health record (EHR) adoption, from the Health Information Technology for Economic and Clinical Health (HITECH) Act of 2009, which was part of the American Recovery and Reinvestment Act. Some limited data suggest that far fewer ambulatory surgery centers (ASCs) have adopted EHRs.2 “We’ve compiled data for the last four years, and our data indicate that less than 10% of the surgery center industry has electronic health records,” says Tom Hui, CEO and president of HST Pathways of Lafayette, CA. HST Pathways creates ASC software to improve efficiencies and revenue and to reduce errors.
Another contributor to the lagging technology advancement is that software has not always worked optimally for ASCs, says Caryl Serbin, RN, BSN, president of Serbin Medical Billing in Fort Myers, FL. Also, hospitals operate under bigger budgets and need more technology than surgery centers, Serbin adds.
“I’d like to see the technology be where it needs to be, so [ASCs] could get more excited about getting on board,” Serbin says. “There are companies out there that do a great job of [designing] ASC software. Other software companies do an OK job, and some companies’ technology is not up to standards.”
When a new software product is released before it is ready, that can cause problems. “If [the software] was not ready for prime time, that is a detracting factor,” Serbin says. “If you go through that experience, and it’s a negative one, it can change how you think about technology.” However, attitudes are beginning to shift. “We are seeing a real growth spurt in terms of people starting to adopt information technologies,” Hui says.
“In the last five years, ASCs are getting excited about having electronic medical records and AI technology, and they’re becoming educated on it,” Serbin reports.
ASCs also are outsourcing some software solutions, benefiting from the latest in technology without investing perhaps already-limited capital funds. “ASCs are increasingly outsourcing revenue cycle management,” notes Michael Orseno, president and owner of Acuet RCM in Chicago. “This allows surgery centers to focus on the clinical portion of running a surgery center. They don’t have to worry about someone being out on maternity leave or sickness or school issues, causing revenue to drop; they never have that issue when they outsource.”
Facilities that lack electronic records and billing are missing out on one of the big advantages that technology brings to the table: cost data and other metrics. “As an industry, we’ve been very behind in collecting cost data,” Hui laments. “There’s a balance between chasing profits and costs and quality.”
Information technology can improve efficiency in labor and supplies, providing data that show where changes can improve costs and time. “Maybe 30% of the total cost of surgery is made up of medical-surgical supplies,” Hui estimates. “If something is 30% of operating costs, it presents a lot of opportunities for cost savings.”
Electronic data collection also makes it much easier to collect labor data, including the OR minutes, which is a common metric, Hui says. “If you do benchmarking, and it takes 60 minutes to do a procedure, but you have a surgeon who takes an hour and a half, then you have a problem somewhere,” he explains. “That kind of measurement has been very hard to take in the industry for a long time.”
Some information technology solutions can track data easily and capture information about every item used. Software solutions also can ensure regulatory compliance and accurate cost data, Hui says.
“We track direct labor. We know when the nurse is in the OR and when the nurse is in post-op, and we get very good cost data on direct labor,” he reports. “When you combine all of this, each has a much better analysis of the cost of doing business.” Revenue cycle management technology can provide analytics that are vastly superior to what any individual surgery center can create on its own, Orseno says.
“It can provide graphs, statistics, and reporting on key revenue cycle metrics, such as days outstanding, percent of AR [accounts receivable] greater than 90 days, charge lag, and net collection rate,” he says. “We can give their metrics and compare them to industry standards, and we can help with things like case costing — how much it costs to do a case.”
These kinds of data can make it easy for surgery center leaders to predict whether they will make money on a particular case. This information is vital to negotiating rates, Orseno says.
For instance, a payer might ask a surgery center to renegotiate rates. The insurer could say it will give reimbursements for certain procedures, but decrease reimbursements for others, he explains. “A surgery center that doesn’t have analytics might say, ‘That’s great,’” Orseno adds. “But if they don’t have their cost data, they could lose money. It’s crucial to have analytics to be competing with these payers.”
Payers always have their own analytics and will negotiate rates to their own advantage, leaving surgery centers at a disadvantage, unless they have access to information technology and data.