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Consolidation Challenge


Independent ASCs could be vulnerable in the face of accountable care organizations. BY MICHAEL A. GUARINO


For a little more than a year now, we have seen large health systems aggressive- ly employing physicians and purchasing


ancillary


health care facilities in various market- places. Many people believe that this is a reaction to accountable care organiza- tions (ACO), the model that Medicare and private insurance companies are moving toward. Where does a freestand- ing physician-owned ASC fit in the new health care marketplace? In some mar- kets, independent ASCs are in danger. During my presentation “Strategies to Combat Market Consolidation” at ASCA 2013 in Boston, Massachusetts, April 17–20, I will discuss how you can protect your ASC in such a scenario and what to do to stay on top of your game. In some markets, health systems have


progressed beyond just employing phy- sicians and are looking to be self-insured or form an insurance company to serve their entire health care delivery region. As this monopoly of the health care sys-


10 ASC FOCUS JANUARY 2013


some markets where the health system controls the primary care physicians, those health systems have brought in their own specialists and forced the care back into their own facilities. In other markets, they have made it so lucrative for specialists at the end of their careers to be employed by the system that this arrangement became the physicians’ only option. With the increase in mal- practice insurance, the rising cost of employees and the declining revenue from payers, physicians are left with few choices beyond joining the health system as an employee. So the perfect storm is occurring. Monopolies are being formed causing health care costs to rise. As we look to the future, ACOs will only limit patient access to care further and lead to an in- crease in the profits of these monopo- lies. My presentation will focus on how


In the last two years, we have reached a tipping point where more physicians are employed by health systems than by independent practices.”


—Michael A. Guarino, North Shore Surgi-Center


tem starts to occur, the large health sys- tems also tend to acquire or start up an- cillary businesses, including ASCs. Just being a high-quality, low-cost provider will not guarantee success in the new era of health care delivery. As the new mo- nopolies that are being formed gain con- trol of the marketplace, they will be able to negotiate higher compensation from private payers, while squeezing indepen- dent ASCs out of the delivery system. In the last two years, we have reached a tipping point where more physicians are employed by health systems than by independent practices. In many markets where I work, I have seen that physi- cian employment by health systems is not just an option, but a reality. And in


to position and market your indepen- dent ASC in order to survive and thrive during this time of rapid change in the health care system. Attend ASCA 2013 and my presentation there to get the lat- est on this and other trends in the mar- ket. Meet other members of the ASC community to discuss the developments that they believe are moving and shak- ing the industry. Go to ascassociation. org/ASCA2013 for more information about this meeting and register today.


Michael A. Guarino is the chief executive officer of North Shore Surgi-Center in Smithtown, New York. He is also the vice president of ASCA and chairman of ASCAPAC.


The advice and opinions expressed in this article are those of the author and do not represent official Ambulatory Surgery Center Association policy or opinion.


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