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Why not hire a consultant to open a surgery center?
When launching an ambulatory surgery center, it's important for physicians to realize that this is a complex, long-term undertaking requiring a unique set of skills, knowledge, and experience in diverse areas. While a consulting team may be able to provide reasonably priced services for facility planning and set up, the need for expert assistance doesn't end when the center opens for business. In fact, successfully managing the daily operations of a facility is probably the most challenging aspect of owning a center.
There are several problems associated with using a consultant group to help plan and develop a surgery center, including:
Here today, but gone tomorrow
Consultants can be a good source of information and guidance about how to set up an ambulatory surgery center. However, a roadmap isn't enough. A functioning facility requires the installation of personnel and systems to get the work done, day in and day out. Ongoing issues, such as staffing, accreditation, and contracts with payors and vendors must be addressed with speed and efficiency. Unfortunately, once the center is open and the contractor has left, the responsibilities of managing day-to-day operations usually falls to an already over-worked physician. At that point it becomes apparent that hiring a consultant was a thrifty, short-term solution for a situation that actually requires a long-term commitment and could prove to be more costly in the long term.
Overtaxed resources
Consultant groups typically have a team of one to four people with expertise in various aspects of surgery center development. However, if any member of the team is unavailable due to illness or commitments on other projects, a center's needs can be ignored for days or even weeks at a time. In contrast, a management team like Surgery Center Partners can draw upon its large pool of experienced personnel to quickly resolve urgent matters. Redundancy is built into our system, so we can promptly respond to the operational issues of every facility.
Misaligned interests
Consultants are hired to perform a specific set of assignments and then leave. Their continuing success often requires that they simultaneously attend to the needs of multiple current and prospective clients. And because they have no vested interest in the success of a particular center one, five, or ten years after it opens, their planning may fail to address issues with long-term consequences. In contrast, the financial success of Surgery Center Partners is directly tied to the well being of our partners' facilities. If a center is thriving, so are we. As a result, we always think about a center's short- and long-term needs.
Increased physician workload
After the consultant's assignment ends, the physicians will be responsible for running their surgery center. But few physicians have the skills, knowledge, and experience required to efficiently manage a center. It's a complex, thankless job that requires expertise in many areas outside a physician's training. While over time they might be able to acquire the necessary capabilities, doing so would involve many hours of time and perhaps some costly mistakes. Moreover, this is not the best use of their time and talent. The hours spent managing a center are hours not spent seeing more patients—and generating more income. After all, the reason for opening a center was to increase the physicians' income on the services they already perform, not to add to their workload.
Higher costs and less revenue
Initially, the cost of services offered by a consultant can be very financially attractive. But this lower price tag may prove to be costly in the long term. Surgery Center Partners has the bargaining power of multiple centers, allowing its procurement professionals to obtain favorable pricing through contract negotiations and bulk purchasing discounts. We also have a record of successfully negotiating fee schedules with payors to obtain the highest reimbursement rates for our partners' facilities. Consultants cannot match these supplier discounts and fee schedules, so higher operating costs and lower fees may impact a center's profitability.
Conclusion
Opening a surgery center is a wise financial decision if it increases a physician's income stream without adding to his or her workload. To realize the benefit of increased passive income, strategic business decisions have to be made to provide long-term solutions to the complex challenges of operating a facility. Otherwise, a center will become a source of additional demands on a busy physician's time and energy. Physicians should plan for the long term and select a management services partner that will meet both their current and future needs.
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