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Why Do ASCs Fail? - August 2015 - Subscribe to Outpatient Surgery Magazine

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those cases," says Mr. Péo. "If they do, it's gravy. But the only cases you can count on are the owners', because they're legally obligated to do at least one-third of their eligible cases in the sur- gery center." Bad contracts Right-sized centers with the right number of physician-owners are still doomed if they don't make money. One of the biggest reasons centers fail is that they sign bad payer contracts, says Mr. Péo. Too many sign the first offer they see, without bothering to nego- tiate. When they do, trouble is bound to follow. You can go back to the payer and say you now realize you've signed a bad con- tract. But the response, says Mr. Péo, is going to be, As soon as it's up, we'll be happy to renegotiate. And even then they proba- bly won't renegotiate much. The key is case costing and negotiating accordingly. But too many centers have gotten lost in the haze that surrounds the myri- ad details. "It takes 2 months to get paid, and there's overhead, sup- plies, implants, and so on," says Mr. Péo. "People don't always understand what it's costing them to do these cases, and that can be a huge money-loser at times." In other words, if you're not making money on a given case, and you keep adding more of those cases, you don't make up for the losses, you just lose more money. "I've seen it a lot," says Mr. Péo. "People making $500 or $600 on a case, but when all is said and done, it's costing them $700 or $800 to do the case." Part of the challenge is teaching surgeons how to think like sur- gery center owners and contain costs, says Mr. Péo. "They're smart people, but they don't know what they don't know. They have to be trained." 4 0 O U T P A T I E N T S U R G E R Y M A G A Z I N E O N L I N E | A U G U S T 2 0 1 5

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