By: Gary Keeling
Executive Director, Change Healthcare
As the COVID-19 crisis has wreaked havoc on our healthcare system, we’ve had to rethink almost every aspect of operations, from patient access to care delivery, to billing. Based on my 25 years’ experience in anesthesia practice management, I anticipate major changes lie ahead for anesthesia departments as provider organizations work to regain their financial equilibrium.
Economic Pressure on Providers Here to Stay
New management and operational approaches will be critical for hospitals and health systems fighting to overcome losses triggered by deferrals of elective care. Although procedure volume is beginning to recover, most organizations will likely be grappling with the economic fallout of COVID-19 for years to come.
Optimizing Anesthesia Operations
All stakeholders will need to help mitigate this ongoing financial challenge. Regardless of whether anesthesia services are delivered by employed clinicians, private practice groups, or staffing firms, the following three strategies for improving anesthesia operations represent a practical path forward for hospital and practice leaders alike:
- Greater operating room efficiency will be essential: Because anesthesia departments play a central role in helping hospitals achieve operating room (OR) efficiency, hospital executives should empower anesthesia leadership to make decisions that can improve throughput while reducing costs. That means creating new OR protocols that positively impact key OR metrics, such as on-time starts, recovery times, and patient safety.
Ending wasteful legacy practices like underutilized surgeon block times or surgeon requests for flip rooms made without the requisite volume of scheduled cases also will be important. Ultimately, executives should bring all stakeholders together to work collaboratively with anesthesia leaders in pursuit of a streamlined OR process.
Here’s one example of the kind of management change that can have a lasting impact: Many anesthesia departments currently receive hospital subsidies as a means of compensating clinicians for inefficient OR scheduling. A more logical and beneficial approach would be to reward anesthesia departments based on performance improvements in areas like start times, OR utilization percentage, and patient/surgeon satisfaction.
- CRNA compensation must evolve: Lower hospital and practice revenues likely will trigger efforts to overhaul compensation packages for Certified Registered Nurse Anesthetists (CRNAs). While CRNAs are and will remain vital members of most anesthesia teams, the hourly payment structure and resulting overtime many practices use to compensate them are putting a growing strain on budgets. CRNAs are highly trained professionals and can earn $170,000-$180,000 per year. As such, it makes sense to convert them to salaried employees with incentive opportunities available based on units generated, hours worked, and other key performance metrics.
Because Change Healthcare’s practice management teams work with more than 170 anesthesia groups, we see a wide range of strategies used to manage and compensate CRNAs. Inevitably, we’ve found that anesthesia groups and hospitals that use salary and bonus programs versus hourly compensation typically have lower overall staffing costs, reduced CRNA turnover, and much higher CRNA job satisfaction.
In essence, bringing CRNAs on as salaried employees allows them to share in the success of the hospital and practice alike. It also offers new hires an excellent opportunity to reduce and eliminate educational debt.
- Hopsitals shouldn't preclude anesthesia providers from working at external ambulatory surgery centers: In my experience, it’s not unusual to encounter hospital administrators who mandate anesthesia providers must work exclusively for the hospital system. What these leaders don’t realize is that when anesthesia clinicians are permitted to staff facilities outside of the health system—notably ambulatory surgery centers (ASCs)—everyone, including the hospital, can benefit.
Consider this scenario: An anesthesia group with 15 physicians and 25 CRNAs adds several ASC contracts. The ASC cases do not require on-call coverage and typically are more lucrative than hospital cases due to the ASC’s better payer mix. In addition, more ASC cases can be performed and billed per day because the cases generally are shorter in duration.
Hence, anesthesia cases done in the hospital setting may generate about $425 per case (12 unit cases x $35.41 per unit = $425), while cases conducted in an ASC can often generate $700 per case (10 unit cases x $70 per unit = $700).
That means that even if the new ASC workload requires the group to hire three additional anesthesiologists, overall revenue-per-partner will increase due to the higher ASC reimbursement and increased case volume. Revenue improvements can, in turn, reduce the likelihood of clinician turnover and make it easier to recruit new providers.
And, the hospital benefits, too: The on-call pool for hospital coverage has now increased by 20%. Finally, ASC duties can be configured as bonus shifts or even scheduled later in the day after the hospital case load declines, thereby enabling CRNAs to be flexed to the ASC facility.
Building Mutually Beneficial Relationships
If nothing else, the pandemic has shown us that—for better or worse—we’re all in this together. Administrators, physicians, and CRNAs must therefore collaborate closely and think unconventionally to ensure their organizations will become more patient-centric and remain operationally and financially viable on the far side of COVID-19. Although there is no single blueprint for improving anesthesia care, those groups and individuals that are willing to pursue creative solutions will enjoy the most success.
At Change Healthcare, we deliver technology-enabled anesthesia coding and billing solutions, as well as cutting-edge business intelligence reporting tools that allow practices to monitor OR utilization across multiple domains, including by day, hour, and surgeon. We also employ an anesthesia practice management consultant team with decades of experience. Our experts work with providers and facilities alike to develop innovative, data-driven practice management solutions.
If you would like to learn more about our services, you can find more information here,
or call 866-817-3813.