ASC contracting help

[pasgasser2]

There's a group of us who are part time hospital employees who staff a local ASC through a large private practice anesthesia group (no non-complete with hospital). This anesthesia group is now pulling out of the area and the ASC will not have anesthesia staff in about month. The ASC reached out to our core group (4 anesthesiologists) looking for a solution. They are offering to hire us as associate providers (no benefits, vacation) at $200/hr and also let us keep a portion of our billing. How much of our billing we get to keep is up for negotiation. Does this seem like worthwhile pursuit? I'm thinking if our billing could get us to at least $325/hr then I can convince my partners to go for it.

The other issue is that the ASC has no expertise in anesthesia billing and so they would need to either hire a billing consultant or we would have to do the billing ourselves which seems like quite the headache. Any suggestions here?

Appreciate all thoughts and pointers!

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[IMGASMD]

There will be some more experienced members who can offer more than what I know…..

If they guarantee certain number of hours, or rooms, it will certainly be worth it.

My group used to cover endo suites at a fixed price. It was “good enough” to afford another physician. Also how you four decide how to assign the rooms and pays. Are you blending, are you keeping your own billing?

There are some national anesthesia billing companies which will negotiate with you to do billing for you…. They’ll keep certain % of your collection…..

 

[nimbus]

There's a group of us who are part time hospital employees who staff a local ASC through a large private practice anesthesia group (no non-complete with hospital). This anesthesia group is now pulling out of the area and the ASC will not have anesthesia staff in about month. The ASC reached out to our core group (4 anesthesiologists) looking for a solution. They are offering to hire us as associate providers (no benefits, vacation) at $200/hr and also let us keep a portion of our billing. How much of our billing we get to keep is up for negotiation. Does this seem like worthwhile pursuit? I'm thinking if our billing could get us to at least $325/hr then I can convince my partners to go for it.

The other issue is that the ASC has no expertise in anesthesia billing and so they would need to either hire a billing consultant or we would have to do the billing ourselves which seems like quite the headache. Any suggestions here?

Appreciate all thoughts and pointers!

Even if the larger anesthesia group was “leaving the area”, they wouldn’t pull out of your ASC if it was a money maker. If the reimbursements were good, they would fight to keep it. They wouldn’t drop it like a hot potato. ASC reimbursements are often disappointing. More than likely, the larger group has been subsidizing that ASC and that is why they’re pulling out. In any case, the larger group has very granular numbers about how much they were making or losing from that ASC. You should try to get a hold of those numbers.

 

[BLADEMDA]

Anesthesia billing is very difficult these days. You will need contracts with all the players. This takes time and the insurance companies will low ball you at around $40 per unit. You need these contracts in place prior to billing for the cases or some insurance companies will likely stall from paying you anything at all. CMS requires contracts in place as well or you risk getting nothing.

Overall, I recommend you avoid the billing entirely if you can get $300-$350 per hour instead. This is my preferred approach as well. Of course, if you get $200 per hour plus the 1/2 or 3/4 the billing that works as well. You must get at least 1/2 the billing for this venture to actually work out. FYI, you all need to form a company, or the ASC needs an anesthesia company, to handle this portion of the business. Your collections will be $200-$350 per hour depending on the payer mix. Most likely, the lower end of the collections , $200-$225 per hour, will end up being the collections based on the fact the national company gave up the contract.

 

[aneftp]

There has got to be something wrong with utilization with the ASC with practices to pull out.

My best guess is and I’ve seen this time and time again it utilization of rooms. Before diving in for the contract. Find out that the percentage is. Yes. You can still make it work

Are they running 3-4 rooms from 7-11am? Than going down rooms as surgeons or gi docs head to their office for patients or hospital for cases?

Agree with blade. You need to hire a billing company and have contracts in place with commercial insurance first. I’ve have seen low ball $50/unit for commercial for small practices and same commercial insurance is giving $100/unit for large national company.

It will cost you between $5-10k in legal fees to setup something. Totally worth the investment divided by the 3-4 of u guys to see what the numbers will be. With ASC splitting billing and still guarantee u the hourly rate.

 

[yossarian22]

I would suggest obtaining legal advice. It is not legal for surgeons to have ownership of anesthesiology companies to profit off of, and this is catching government attention. I would decline this offer.

Sorry. This document is not available.

www.jdsupra.com

 

[IMGASMD]

I would suggest obtaining legal advice. It is not legal for surgeons to have ownership of anesthesiology companies to profit off of, and this is catching government attention. I would decline this offer.

Sorry. This document is not available.

www.jdsupra.com

If I read the article correctly, there’s always some money going back to ASCs. So as long as OP doesn’t channel back any money, then it’s alright.
Certainly get a lawyer or two to vet it. And think what would make sense to you.

 

[Pappy Van Propofol]

You can never fully trust an ASC. There’s too many competing interests.

 

[DirtDocMD]

1) Find out their payor mix

2) Get 3-6 months of cases from them, with times, to try and make heads or tails of volume AND utilization (Are these cases all between 8-11, is “primadonna” surgeon showing up at 3pm and working til 8pm??)

3) Does anesthesia get any ownership shares, or are you simply staffing the place? (Makes a difference in how you’re treated, and how easily they’ll kick you out.)

4) If unsure on profitability, at least put in a “floor” (which it sounds like they are doing) so that the ASC guarantees $200-$300 (your decision) per hour worked, BUT WITH A GUARANTEED MINIMUM (say, 30 hours, which they are NOT currently doing). It’s up to them to bring in cases. You’re not going to easily pick up work, elsewhere, the night before, when you find out they’re only running 1-2 rooms the next day.

5) Most big groups are happy to cover ASC’s if easy/profitable. The fact they are NOT, means you’re getting real lucky, or “something ain’t right”.

6) The other big issue, as Blade/aneftp mentioned, is negotiating payor rates. The big groups can get big money, but “4 anesthesiologists” are going to have a hard time doing this. (PM me, and I may have a tip or two for you, depending on what state you are in. And, no, I don’t wanna know the locality, to try and horn in on you.)

 

[undalay]

A lot of these contracts are poorly reimbursed and difficult to staff, particularly if the location is not ideal or difficult to travel. Malpractice costs and slow surgeons as well as schedule with one or 2 cases with large gaps in between?
Anesthesia needs to have control of schedule otherwise you will be losing money staffing

 

[narcusprince]

I echo you have to have ownership of the asc to have value. Staffing an ASC is good until they find someone else. Primmadonna surgeons are an issue also make sure everyone working at the asc on the doc side is a partner with the ability to walk.

 

[narcusprince]

Leverage Leverage Leverage! Plenty of surgeons around not so many Anesthesiologist.

 

[BLADEMDA]

Let me clarify: the risk goes to the ASC. Every single provider gets paid an hourly rate like $200 per hour with a minimum guarantee of 6-8 hours. If they want CRNAs to flip rooms or boost staffing the ASC pays that FULL COST. The billing/revenue is used to pay you and the ASC 50/50 not the CRNAs. Unless you structure this carefully your total per hour fee will be in the $225 per hour range. I highly recommend you build in safe guards or AVOID this contract.
As a 4 person group you won't be getting $60 per unit from most payers for an ASC. A typical rate will be $45-$50 per unit. Hence, you can't afford to provide CRNAS and anesthesiologists at that rate. Again, assume the collections will be pretty bad around a $35 blended unit. Even with that blended unit as long as the ASC agrees they pay for the hourly costs and do not subtract that from the collections. If the plan is to subtract the cost of all the providers from the collections then divide the remaining money by 1/2 I can assure you there won't be any money left to divide up.

I gave up on billing myself for cases. The risk falls to the ASC and I collect my pay regardless of the payer mix. This is how I schedule my work and I have no regrets not billing for cases. I'd rather ask and get $350 per hour for a 8 hour minimum then go through the hassles of trying to bill/collect from insurance companies. Now, if you can get an 80/20 or 70/30 insurance/CMS mix it may be worth billing for cases. Most of the time if a private AMC gave up the contract the collections aren't going to be good.

 

[Hoya11]

There's a group of us who are part time hospital employees who staff a local ASC through a large private practice anesthesia group (no non-complete with hospital). This anesthesia group is now pulling out of the area and the ASC will not have anesthesia staff in about month. The ASC reached out to our core group (4 anesthesiologists) looking for a solution. They are offering to hire us as associate providers (no benefits, vacation) at $200/hr and also let us keep a portion of our billing. How much of our billing we get to keep is up for negotiation. Does this seem like worthwhile pursuit? I'm thinking if our billing could get us to at least $325/hr then I can convince my partners to go for it.

The other issue is that the ASC has no expertise in anesthesia billing and so they would need to either hire a billing consultant or we would have to do the billing ourselves which seems like quite the headache. Any suggestions here?

Appreciate all thoughts and pointers!

something similar happened to me.

you bill, or they bill. thats the first decision.

its not legal to have you form a group and bill and give anything at all back to the ASC or to surgeons. you would have to bill under your LLC and keep it all. get an office/admin. benefits, lawyers, accountants. it would be a lot to put together and would only make sense IMO if it were a super busy center with high payer mix.

but they can legally bill and give you a productivity bonus, as they proposed. this seems much easier and cleaner to me.

the weird part of the deal you described is how it is structured with hourly pay and then no benefits and vacation...!!??

they should offer you a more comprehensive package - Maybe ask for 450k. You stay until cases are done. Annual productivity bonus, with 8 weeks vacation and full benefits (they must do benefits and vacation or their other staff) Maybe they come back with 400k. You could try to get some other docs or CRNAs you know to provide vacation coverage to make it easier for the centers staffing.

 

[pasgasser2]

Thank you ALL for the excellent insight and advice. To give more context- the large anesthesia group leaving our area is not a national company but a large physician-owned group. The group lost the contract with our hospital in town and the hospital in turn employed most of us. For whatever reason our former group refused to let us stay on with them to continue to staff the ASCs and instead is pulling out of all the ASCs in the area, citing their non-compete policy which in turn means they no longer have the staff to renew the contract with the ASCs, because we all now work for the hospital. Obviously we think this is a poor solution but the group's board of directors will do what they want.

Getting back to the meat of the matter- the ASC initially proposed that we work with another local anesthesia group so that this group could take care of all the billing and malpractice. We were not very receptive to this because the other group is partially owned by a CRNA and also doesn't have the best reputation in the area. The CEO of the ASC really wants to keep our core group at the ASC and brought up another possible solution which I think is the way to go: the ASC employs us as associate anesthesiologists, provides us an hourly base + the upside of collections, and also provides malpractice. We actually don't need vacation or benefits because those of us currently working at the ASC are either 0.75 or 0.5 FTEs at the hospital with 22-33 weeks of scheduled work per year at the hospital, the rest of the weeks of the year are ours to utilize as we please. The hospital provides all of our benefits.

The ASC wants to make this work but has no idea how to do the billing for anesthesia services and is also concerned about professional liability coverage. The malpractice insurance issue shouldn't be a problem as we could all obtain an occurrence policy and have the ASC pay for it. But it sounds like doing the billing ourselves and having to negotiate with insurers would be a nightmare. The four of us just don't have the expertise or experience to do this.

I'm thinking about maybe pointing the ASC's CEO to an anesthesia billing consultant like Anesthesia Management Solutions | Anesthesia Business Consultants
Would it be a reasonable solution to have a billing company take care of everything for the ASC? Would the billing company also negotiate with insurers for optimal rates as part of their services or is this a separate consultant that would need to do this?

Also, the ASC currently only runs one room a day so it's usually a full schedule M-F from 7:30-4p. The ASC CEO did tell me that if we had enough staff, they would like to go back to running two ORs and open only 4 days a week Mon-Thurs. Regardless I think we will most certainly ask for a 6-8 hour daily guarantee if we were to proceed.

 

[kidthor]

Why don't just you start your own new ASC anesthesia group? Seems like the perfect time and the ASC has interest. That way you retain ownership and negotiation ability...

 

[minwoo]

Why don't just you start your own new ASC anesthesia group? Seems like the perfect time and the ASC has interest. That way you retain ownership and negotiation ability...

We don’t have any interest in ownership or having to worry about billing/insurance negotiation. We just need to have competitive pay to make it worthwhile for us to continue to staff the ASC. We’ll likely need to convince two other part timers at the hospital to help us staff the ASC year round and the only way to convinice them will be a competitive rate to make it worth their while.

 

[IMGASMD]

We don’t have any interest in ownership or having to worry about billing/insurance negotiation. We just need to have competitive pay to make it worthwhile for us to continue to staff the ASC. We’ll likely need to convince two other part timers at the hospital to help us staff the ASC year round and the only way to convinice them will be a competitive rate to make it worth their while.

——

Thank you ALL for the excellent insight and advice. To give more context- the large anesthesia group leaving our area is not a national company but a large physician-owned group. The group lost the contract with our hospital in town and the hospital in turn employed most of us. For whatever reason our former group refused to let us stay on with them to continue to staff the ASCs and instead is pulling out of all the ASCs in the area, citing their non-compete policy which in turn means they no longer have the staff to renew the contract with the ASCs, because we all now work for the hospital. Obviously we think this is a poor solution but the group's board of directors will do what they want.

Getting back to the meat of the matter- the ASC initially proposed that we work with another local anesthesia group so that this group could take care of all the billing and malpractice. We were not very receptive to this because the other group is partially owned by a CRNA and also doesn't have the best reputation in the area. The CEO of the ASC really wants to keep our core group at the ASC and brought up another possible solution which I think is the way to go: the ASC employs us as associate anesthesiologists, provides us an hourly base + the upside of collections, and also provides malpractice. We actually don't need vacation or benefits because those of us currently working at the ASC are either 0.75 or 0.5 FTEs at the hospital with 22-33 weeks of scheduled work per year at the hospital, the rest of the weeks of the year are ours to utilize as we please. The hospital provides all of our benefits.

The ASC wants to make this work but has no idea how to do the billing for anesthesia services and is also concerned about professional liability coverage. The malpractice insurance issue shouldn't be a problem as we could all obtain an occurrence policy and have the ASC pay for it. But it sounds like doing the billing ourselves and having to negotiate with insurers would be a nightmare. The four of us just don't have the expertise or experience to do this.

I'm thinking about maybe pointing the ASC's CEO to an anesthesia billing consultant like Anesthesia Management Solutions | Anesthesia Business Consultants
Would it be a reasonable solution to have a billing company take care of everything for the ASC? Would the billing company also negotiate with insurers for optimal rates as part of their services or is this a separate consultant that would need to do this?

Also, the ASC currently only runs one room a day so it's usually a full schedule M-F from 7:30-4p. The ASC CEO did tell me that if we had enough staff, they would like to go back to running two ORs and open only 4 days a week Mon-Thurs. Regardless I think we will most certainly ask for a 6-8 hour daily guarantee if we were to proceed.

How did you guys get around the non-compete? The original group left for good and don’t really care for your particular market? Also like others have said, if it was lucrative, they could have be more aggressive….

I believe even with those billing companies, there is still some negotiation with insurance companies. You can still haggle for unit prices. Our old billing company would provide “analysis” for us every year, they would/could recommend a price point, but our group still need to engage in discussion or negotiations.

I still think you should consider forming a group, if it’s a good gig. So you need to do some homework as well. If it’s good, maybe you can find other people to join later on, and make it a permanent thing as a bridge to retirement….. just saying.

 

[pasgasser2]

We don’t have any interest in ownership or having to worry about billing/insurance negotiation. We just need to have competitive pay to make it worthwhile for us to continue to staff the ASC. We’ll likely need to convince two other part timers at the hospital to help us staff the ASC year round and the only way to convinice them will be a competitive rate to make it worth their while.

——



How did you guys get around the non-compete? The original group left for good and don’t really care for your particular market? Also like others have said, if it was lucrative, they could have be more aggressive….

I believe even with those billing companies, there is still some negotiation with insurance companies. You can still haggle for unit prices. Our old billing company would provide “analysis” for us every year, they would/could recommend a price point, but our group still need to engage in discussion or negotiations.

I still think you should consider forming a group, if it’s a good gig. So you need to do some homework as well. If it’s good, maybe you can find other people to join later on, and make it a permanent thing as a bridge to retirement….. just saying.

As my colleague has said, we don't have any interest in ASC ownership or forming a group. Our time at the hospital keeps us busy enough and we don't have the time or manpower to go through all the legal/business set-up to make it work.

When our previous group lost the contract, they were considerate enough to not enforce the non-compete considering that many of us live in the area and it would be highly disruptive for us to have to move/commute to other hospitals that the group continues to contract with.

 

[BLADEMDA]

I say you bill the ASC hourly for your labor at say $275-$300 per hour. You contract with a billing company like ABC to handle the collections. Once you actually get revenue from the billing you reduce your hourly rate with the ASC. You meet with ASC leadership and review the collections quarterly. You adjust the hourly rate based on the previous quarter. ASC floats the first quarter from their budget. This is an honest way of doing business.