September 27th, 2011
The Pennsylvania Health Care Cost Containment Council (PHC4) – an independent state agency responsible for addressing the problem of escalating health costs, ensuring the quality of health care, and increasing access for all citizens regardless of ability to pay — recently completed a report on the status of the state’s ambulatory surgical centers.
Says PHC4 in a press release issued today:
Ambulatory surgery centers (ASCs) in Pennsylvania remained financially healthy overall in fiscal year 2010 (FY10), according to a new report from the Pennsylvania Health Care Cost Containment Council (PHC4). The statewide average operating and total margins for ASCs were 26.20% and 26.29%, respectively. The margins remained in the 26.00% to 26.30% range over the last three-year period (FY08 to FY10).
The ASCs’ average total margins among the nine regions in Pennsylvania ranged from a low of 17.66% to a high of 35.04%.
“In general, ambulatory surgery centers in Pennsylvania are thriving,” said Joe Martin, Executive Director of PHC4. “After a decade of considerable growth, the number of ASCs increased only marginally between FY09 and FY10.”
Eight new facilities opened and four closed, for a net growth of only four facilities in FY10. In the period from FY01 to FY09, the number of ASCs increased from 98 to 262, an average increase of 18 facilities per year.
In response, the Hospital & Healthsystem Association of PA released a statement saying that the data in the report continues to raise questions about the ability of the uninsured and people on Medicare and Medicaid to gain and maintain their access to health care.
According to PHC4, there are now 266 ambulatory surgery centers (ASC) in the state, up from 72 ten years ago, far exceeding the number of general acute care hospitals (165). ASC total profit margins have exceeded 26 percent in each of the past three years. This is in part due to the fact that Medicaid accounted for only 4.5 percent of ASC revenue in 2010, compared to 11.8 percent of general acute care outpatient revenue.
“As the congressional deficit-reduction ’super committee’ gets to work this fall, it is imperative that members of the panel—and by extension all members of Congress—understand the pivotal role that acute care hospitals play in providing a health care safety net for our most vulnerable citizens,” said HAP President and CEO Carolyn F. Scanlan. “With ASCs treating healthier, and usually better insured, patients, the financial and clinical demands on acute care hospitals, which are a safety net for all Pennsylvanians, continue to grow.”
“Under the original Affordable Care Act health reform law, hospitals nationwide already have accepted shared sacrifice amounting to $155 billion in payment reductions—$9 billion in Pennsylvania alone,” Scanlan said. “In addition, Pennsylvania’s fiscal year 2011-2012 state budget cut Medicaid payments to hospitals by 4 percent.”
Scanlan noted that these cuts do not include additional cuts imposed by regulations, and she said that the Medicare and Medicaid programs already underpay hospitals, paying less than the cost of care.
“The bottom line for our patients is access,” Scanlan said. “We continue to support maximizing insurance coverage for all Americans, but it cannot be done by reductions to providers, without whom nobody — insured or not — will be able to get care.”