Share with competition? It may be advantageous

While outpatient surgery providers often are fierce competitors, some providers are finding multiple advantages in sharing equipment, supplies, and even names of potential employees with each other.

Here’s some of the strategies that have paid off for same-day surgery providers:

  • Sharing information.

Sharing information in a variety of areas can be very helpful when opening new outpatient surgery programs, says Deborah T. Womble, RN, CNOR, administrator at Children’s West Surgery Center in Knoxville, TN. Another surgery center in Knoxville allowed the business office manager and the nurse manager from Children’s West to visit for several days. "They shared forms, inventory lists, etc.," she says. "The nurse manager from this facility would call me every time she would think of something that had been a problem for them in the upstart."

Additionally, Womble and her nurse manager visited another pediatric-specific surgery center in Memphis, TN, one of only 10 in the world. "We spent the day with the nurse manager touring her facility and asking questions of any staff members," Womble says. "That was a wonderful experience. We didn’t feel so alone then."

The nurse manager shared forms with Womble. "We discussed things they had tried and failed as well as those that were successful for them," she adds.

Womble has obtained information through other networking resources including the member directory of the Federated ambulatory Surgery Association (FASA) in Alexandria, VA. She surveyed FASA members concerning anesthesia criteria specific to pediatric population and received a good response, Womble explains.

Other networking opportunities have come through a chat group of perioperative nurses who belong to the Association of periOperative Registered Nurses (AORN) and e-mails obtained at national surgery conferences. Additionally, she is forming a support group of area surgery center administrators and nurse managers.

Mount Nittany Surgical Center in State College, PA, is on friendly terms with its community hospital, says Roger Pence, administrative director of Mount Nittany and president of FWI Healthcare, an Edgarton, OH-based consulting firm for primarily ambulatory health care providers. Originally, the not-for-profit hospital sponsored the formation of the not-for-profit ASC. Several members of the hospital board also serve on the surgery center’s board.

"During capital budgeting time, we share information on equipment/instruments each may be purchasing so that we both buy the same manufacturer, model, or style," Pence says. "This way, we don’t end up with a [lemon] no one will use or have problems in getting it serviced."

Also, the surgeons who work in both settings have the opportunity to use familiar equipment in both places. And when clinical staff are hired from the hospital, they already have used the same style and type of equipment, he says. "This, in turn, enables their orientation to be rapid and proficient," Pence explains.

Many of the items that the hospital and ASC share information on are high-volume usage such as scopes and drills. For other items, the center’s managers determine the expected volume of procedures to justify the purchase of equipment.

  • Sharing names of potential employees.

Initially, Womble called a nurse manager at another ASC to ask whether she would consider being a nurse manager at Womble’s facility.

"She was happy where she was, but recommended a staff nurse who was working part time at two facilities," she says.

That nurse was hired and has been with the ASC for 1½ years, Womble adds.

  • Sharing equipment and supplies.

Even when a hospital’s managers are adamantly against the formation of a surgery center, many of the hospital’s departments eventually may work out verbal or written agreements to help the ASC, Pence advises. For example, an ASC, with its low-volume usage of expiring drugs, can trade these drugs to the hospital where there is a higher volume usage.

"Occasionally, when certain surgical supply items unexplainably are not in inventory, a call to the local hospital by the ASC usually will result in the ability to borrow stock until delivery is made," Pence says. Also, ASCs may be able to rent floor polishers and other infrequently used items from their local hospitals, he adds.

"When there is a positive working relationship with the local hospital, the ASC even has greater benefits in this area," Pence notes.

Womble’s facility, four other surgery centers, and a nearby hospital help each other when they need instruments, sutures, or other supplies.

"If they have a pediatric need, we can usually be helpful to them," Womble says. "They can help us with general things."

While some providers may be wary of loaning expensive instruments, Womble says her experience has been positive.

"So far, we have been very fortunate that the facilities have taken very good care of our instruments, and we have [taken very good care of] theirs,’ she says. " If we started having problems with care of our instruments or not prompt return, this would be a problem."

Sometimes, Children’s West allows a surgeon investor to use instruments at another facility. In some cases, the borrowing surgeons are ones who Womble would like to have as investors. "Kindness goes a long way for many things," she says.

If you are providing equipment or supplies to another organization at less then fair-market value, consult with your legal advisor to ensure you aren’t violating any laws or tax codes, legal experts advise.

For example, if a tax-exempt entity is involved, the question, at a minimum, raises private inurement and private benefit issues, explains Eric Zimmerman, JD, partner with McDermott Will & Emery in Washington, DC.

"In addition, if any of the users are persons with substantial influence over the affairs of the tax-exempt entity — such as medical directors or, perhaps, large referral sources — then intermediate sanctions issues under Section 4958 of the Internal Revenue Code also arise," he points out. "Further, if any of the facilities or equipment are financed with the proceeds of a tax-exempt bond offering, the analysis becomes even more complex."

In addition, the Stark Law and fraud and abuse laws may be applicable, Zimmerman says.

  • Selling equipment.

Womble’s facility and other local surgery center have purchased instrument sets from each other. "The sets and/or equipment we sold to each other was sold at our original cost," she says. "I discounted a liposuction unit $1,000 so we could borrow it."

Having collaborations with area providers offers multiple advantages, Womble adds.

"I believe these types of relationships are critical to the quality of patient care we provide," she notes. "I have never denied any facility anything it needed for a patient. We all can’t have everything we need and must help each other."


For more information on collaborations among same-day surgery providers, contact:

  • Roger Pence, FWI Healthcare, 04405 Road D, Suite 300, Edgerton, OH 43517. Phone: (419) 298-3700. Fax (419) 298-3750. E-mail:
  • Deborah T. Womble, RN, CNOR, Administrator, Children’s West Surgery Center, 1020 Children’s Way, Knoxville, TN 37922. Phone: (865) 560-0303. Fax: (865) 670-9082.