ASC Industry Awareness
Benefits of ASC Physician Ownership
Control over the clinical environment, the quality of care, and patient convenience are major benefits of ASC physician ownership. While ASC ownership models have widened over the past several years, models of ASC physician ownership still heavily dominate the ASC landscape. Eighty-seven percent of all personal health spending in the US runs through physicians. That centrality is another benefit of ASC physician ownership. ASCs are valuable physician assets that support practice growth and they continue to benefit the healthcare ecosystem through quality, safety, efficiency, and cost control.
Implications of Elective Shift from Inpatient to Outpatient
Expanding the list of surgeries that are performed safely in outpatient surgery centers continues to be a boon for an increasing number of specialties, including cardiology and spine and orthopaedics. Four common surgeries shifted strongly from inpatient to outpatient during COVID-19. Hospital executives expect a greater shift to outpatient care in the upcoming years. From 2019-2021, ASC utilization rates rose 10.26%. Outpatient revenue continued to rise in 2022, showing a 10% increase from a year earlier. This has implications for how US hospitals function, as half finished 2022 with a negative margin, in part due to this shift.
Healthcare Industry/Trends
ACA: Tenth Year of Open Enrollment
When new ACA healthcare exchange enrollments started rising at a rapid rate last November, it became apparent that changes in the exchange markets along with ongoing inflation were driving enrollment. As of November, the breakdown of the largest ACA payer in each state shows that over 20 insurers share that designation and they hold from 26-97% of their respective state markets. The ACA exchange added 3.6 million new subscribers for 2023 for a record of over 16.3 million total subscribers. Senator James Lankford (R-OK) has reintroduced a bill, the Patient Access to Higher Quality Health Care Act, to remove the ACA’s ban on the expansion of new physician-owned hospitals.
Other Government Action Affecting Healthcare
Medicare status quo is increasingly in the news with the Boards of Trustees for Medicare warning that, unabated, program shortfalls will come in as little as six years. Senators Maggie Hassan (D-NH) and Mike Braun (R-IN) are seeking to close loopholes that insurance companies can use to obscure health plan prices. Federal health programs could be banned from using quality-adjusted life years (QALY) as a value of care measure if new patient protection legislation passes congress. The CMS Rural Emergency Hospital designation is starting to ease the financial pressures on rural hospitals by converting them to emergency and outpatient care only. One thousand seven hundred rural facilities are eligible for the designation.
Healthcare Digital Transformation Watch
Digital Health Bubble?
During the height of the COVID-19 pandemic, we all (providers, patients, and payers) became much more comfortable with digital health tools. As a result, digital health expanded quickly. By Q4 2022, digital health investment contracted significantly. The industry is experiencing market winnowing as hospital systems sift out the players making the largest contributions at price. The March 10 Silicon Valley Bank (SVB) collapse will further challenge the financial confidence of healthcare tech companies. SVB’s Global Life Science and Healthcare division includes investments in health tech, medical devices, and diagnostics. SVB is a significant healthcare banker with $78.8B in healthcare deposits and investments.
Healthcare M&A, Valuation, Revenue Cycle
Retailers and Pharmacies
With over 125 primary care locations in the US in over 20 metro geographies, OneMedical is now partnering with Amazon to make 24/7 primary care easier through the membership subscription model. In early March, Atrium Health and Best Buy partnered to tap into wider home-health care offerings through specialty trained Geek Squad agents that set up in-home wearable technology for Atrium Health remote monitoring. Dollar General continues their expansion into medical care through their partnership with mobile clinic provider, DocGo. Walgreens-owned primary care unit, VillageMD announced the acquisition of Starling Physicians, a 30-location multispecialty group in Connecticut, further extending their primary care.
Out-of-Network Watch
IDRs Can Resume … Somewhat
Certified independent dispute resolution entities can resume issuing payment determinations, but only for disputes involving out-of-network services submitted before October 25, 2022. Disputes filed beyond that date will await guidance from the departments of Labor, Health and Human Services, and Treasury. Several medical societies have contended that the increased non-refundable administrative fee (from $50 to $350) per submission limits IDR accessibility for lower-paying physician services. A revised IDR process consistent with the court’s February 6 decision would address providers’ concerns regarding the application of the median in-network rate as the sole determinant of payment amounts.
Legal
Federal Budget FY 2024: Top Health Policies
From the office of Jon Sistare, JD, Attorney at Law
President Joe Biden released his budget for the 2024 federal fiscal year, outlining new investments to expand Medicaid, drug price reforms, and other new policies.
Here are some of the top health policies to be aware of in the budget:
- Close the Medicaid coverage gap
The budget proposes to close the Medicaid coverage gap in states that have not expanded under the Affordable Care Act (ACA). A legislative effort to offer subsidies to people in such a gap ran aground in the last Congress, but still enjoys wide support among Democrats. - Make ACA enhanced subsidies permanent
A major driver of record growth on the ACA’s exchanges has been a boost to subsidies included in the American Rescue Plan Act. Those subsidies were recently extended last year through 2025, but the budget would seek to make them permanent. - Build upon drug price negotiation reforms
The budget would install new drug price reforms that include limiting Medicare Part D cost sharing for high-value generic drugs used in cholesterol, hypertension, and other conditions to no more than $2. This would also apply to all Medicare Advantage prescription drug plans. - Boost funding for Medicaid home services
The White House aims to invest $150 billion over 10 years to boost Medicaid home-based and community-based services. The money would go to help with personal care services and “improve the quality of jobs for home care workers.”
At a Glance
March Is Deep Vein Thrombosis Awareness Month
Understand the Risk. Recognize the Symptoms.
New Clinical Review Program for Employers
Cleveland Clinic Program Provides Review of Medical Records
Doctors Without Borders’ 14-Truck Convoy to Syria
Donates 12 Tons of Emergency Supplies for Earthquake Victims
Healthcare Real Estate in Mixed Use Developments
Healthcare Provides a Significant Value Add
Walmart Health Expanding Primary Care Clinics
Plans to Operate 75 Clinics by End of 2024
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