ASC Industry Awareness
ASC Opportunities Overcome Dilemmas
Demand for high quality low complication outpatient surgeries is fueling ASC growth across a wide spectrum of specialties. Opportunities exist for those able to overcome hurdles. While Certificate of Need (CoN) regulations curtail per capita healthcare access, a new Montgomery, AL ASC gained approval to be built. The private equity dilemma presents to ASC leaders the competing propositions of fueling growth or losing control. For surgeons wanting a more active role in patient care, there is the challenge of employment versus going it on your own, which this spine/neurosurgery practice has done. New centers must also solve the challenge of whether to focus on one sphere of specialties or to diversify.
ASC Ortho/Spine Growth Five-Year Forecast
Orthopedics and spinal procedures have been consistently shifting from inpatient hospitals to outpatient surgery centers. A 2024 Sg2 report forecasts a 12% increase in spine and ortho in ASCs in the next five years and a 22% increase in the next decade. Physician incentives to work in ASCs, appropriate payer reimbursements, and the clinical appropriateness of the procedure are all growth drivers. More complex minimally invasive spine surgeries, new instrumentation, and post-operative pain control all help spinal surgeons lean into more ASC case growth. This uptick in ASC procedures advances safety and efficiency while reducing cost, which is a win-win-win for patients, physicians, and payers.
Healthcare Industry/Trends
Two Hurricanes Cause Deep IV Fluid Supply Issues
Hurricane Helene caused an unpredicted outage that is affecting healthcare from coast to coast, which has been compounded by Hurricane Milton. A new IV fluid supply deficit, caused by a damaged North Carolina intravenous fluids plant that supplies 60% of the nation’s IV fluid, has forced hospitals to postpone elective surgeries. The second-largest maker of IV fluids has also temporarily closed two of its facilities in Daytona Beach, FL due to Hurricane Milton. This is why hospitals across the country are conserving IV supply by limiting elective procedures. The American Hospital Association is calling for the federal government to boost supply of IV solutions. The FDA is planning to allow temporary importation of IV products.
Molting Medicare
Medicare is a curious chameleon experiencing several alterations over time due to background conditions. One of the most enduring curiosities for providers is the calculation of commercial insurance estimates per state to the Medicare benchmark. See here to capture how that reptile works. That, along with the diminished role of the Medicare Economic Index has contributed to an effective physician payment decline of 29% since 2021. Medicare Advantage is the latest to flirt with reptilian ways. Insurers have sunned themselves by it, pocketing $50 million for diseases no doctor treated. In the shade, Medicare Advantage plans are paring back for 2025, are no longer a gold mine for private insurers, and are a huge frustration for providers.
Healthcare M&A, Valuation, Revenue Cycle
Urgent Care, Stryker, RCM, AI
Community Health Systems is acquiring ten urgent care centers in Arizona as it continues its years-long efforts to sell off hospitals, replacing them with outpatient services. On the medical equipment side of the healthcare universe, Stryker has been busy, completing their acquisition of Care.ai to strengthen their healthcare IT and wireless medical device book of business and the purchase of a pain management company. End-to-end revenue cycle management companies continue growing in the current healthcare market as they pick up the pace of buying out specialized revenue cycle leaders. An AI prior authorization platform announced that it closed a $25 million investment round, with several payer participants.
Out-of-Network Watch
Actions to Support Original Intent of NSA
The No Surprises Act (NSA), which was enacted December 27, 2020 and took effect January 1, 2022, is doing what it was intended to do for the most part, which is protecting patients from surprise medical bills. However, there is ongoing legal wrangling regarding the enforceability of the independent dispute resolution (IDR) aspect of the act. In response, five members of the US Congress banned together to introduce the No Surprises Act Enforcement Act to reinforce the original intent of IDR functioning. The American Hospital Association also challenged the district court decision rendering IDR awards unenforceable as have a variety of healthcare management organizations and physicians.
Healthcare Digital Transformation Watch
Healthcare Cybersecurity Risk
According to newly published survey results, 92% of healthcare organizations surveyed experienced one or more cyberattacks in the past twelve months and 69% of those resulted in patient care disruptions. In 2024, healthcare and public service organizations have been heavily targeted for highly damaging attacks. Medical devices are increasingly valuable and destructive points of entry for cyberattacks. Healthcare across the pond is in the crosshairs as well this summer as thousands of London hospitals canceled procedures due to a blood test data hack. In late September, Senate Finance Committee leaders announced legislation aimed at mandating healthcare cybersecurity protocols.
Legal
Healthcare AI Regulatory Framework Still Developing
From the office of Jon Sistare, JD, Attorney at Law
The integration of AI into healthcare is set to reach new heights while the policy framework for AI continues to change. AI has the potential to transform healthcare but also comes with known and not-yet-understood risks. Organizations should spend time building a clear understanding of their AI strategy and priorities, as well as the attendant risks associated with AI in healthcare.
While there is not current, universal law governing AI, there is a patchwork of privacy, consumer protection, healthcare, and health information technology laws and regulations that pre-date AI and apply to its use. In the absence of a broad-
spectrum AI regulation, policymakers have efforts underway to address the gaps, which include the White House Blueprint for an AI Bill of Rights and voluntary commitments from leading AI companies to develop safe, secure, and trustworthy AI.
Given the rapidly changing environment, it is essential to evaluate how AI can be used to improve healthcare and efficiencies within the healthcare industry, but to also understand its impact if used adversely to a patient’s best interests.
At a Glance
Indy Pharmacies in Trouble, Fear Closure due to PBMs
Indy Pharmacy Owners Hoping for Regulatory Action
Employer Benefit Costs to Rise at Least 5% for Third Straight Year
Following a Decade of 3% Annual Increases
Neurosurgeons Back Bill to Life Ban on Physician-Owned Hospitals
Would Allow More Rural Physician Ownership
Reimbursements Are Changing the Patient Physician Relationship
Low Reimbursements = Low Time with Patients
Hospitals Say Insurance Denials Are Spiking and Admin Costs Rising
Burdensome Insurer Hurdles Raise Admin Costs
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