by Beckers ASC Review
PHILADELPHIA, October 27, 2009 -- Medical/surgical costs remain the second highest operating expense of surgery centers. In a difficult economy, with lower case volumes and tightened reimbursements, watching these costs is crucial.
Robert Edelstein, president of Millennium Surgical Corp., discusses seven tips ASCs should consider when making surgical instrumentation purchases.
1. Look at higher cost items when comparing surgical instrumentation costs.
Higher-cost surgical items account for a good deal of a surgery center's medical/surgical costs. However, it may be beneficial for a center to look into these more expensive items to see if the item is worth the higher cost or if a less expensive alternative can provide the same quality.
Mr. Edelstein suggests that ASCs focus cost comparison and evaluation on these higher-cost items. "These items will have the most effect on your surgeon satisfaction and your budget. Use a vendor who has qualified product consultants and the resources to help you do this quickly, effectively and in an organized manner," he says.
Mr. Edelstein adds, "A good practice is to focus on the instruments which cost more than $100 and find a resource that can help you compare these items quickly and effectively."
2. Price can correspond with quality and surgeon satisfaction.
Some surgical items, more than others, can affect surgeons' performances if they are not of the best quality. However, surgery centers should determine what these items are as opposed to what items can yield high quality at a lower cost.
"It's important to selectively invest in quality," Mr. Edelstein says. "Certain instruments, such as needle holders and scissors, are more likely to breed surgeon contention than others if quality or maintenance is sub par. Purchase the highest grade of these and similar instruments, and your surgeon and staff satisfaction will rise."
Likewise, items such as handheld retractors, sponge forceps, towel clips, dressing, tissue forceps and basic hemostats will not directly affect surgeon satisfaction.
"Identify target areas to help your center's bottom line," Mr. Edelstein says. "Clearly identity which instruments do not impact surgeon satisfaction. Buy these from the low cost vendor as long as the quality provides an instrument which will hold up well."
3. Suppliers are not necessarily manufacturers.
Most surgical instrument suppliers are not the manufacturers of the products they distribute, as they outsource to a number of companies. According to Mr. Edelstein, this means that the market has a flux of identical instruments that are multi-branded and sold at varying costs.
"Your surgical instrument source should have relationships with many quality manufacturers to ensure you get the quality instrument your [ASC] requires," he says. "Find an instrument source who can assure surgeon satisfaction and instrument performance allowing you to compare cost even when a surgeon demands a certain brand."
4. Foster good relationships with suppliers qualified to meet the needs of your center.
According to Mr. Edelstein, as the ASC industry grows, the number of qualified surgical instrument suppliers required to support these centers also grows. As result, ASCs will have more options when it comes to suppliers, which can lead to lower costs for quality products.
However, jumping between suppliers is not a good strategy, as fostering a good relationship with a single supplier can yield better results.
"Make sure you work with a company who specializes in providing surgical instruments to ASCs," he says.
5. Standardization can equal cost savings and simplify ordering.
ASCs frequently run into instances where they are ordering several types of the same product because one surgeon prefers a particular brand and another surgeon prefers a different brand. This practice can lead to excess inventory and higher costs for items that may not impact overall quality.
Mr. Edelstein recommends the ASCs take the following steps to simplify this process:
6. Make sure to verify discounts with vendors.
One way ASCs often save money on surgical instruments is by negotiating discounts with vendors. However, Mr. Edelstein notes that it is important for ASCs to verify these discounts when placing contracted instrument orders
"Many times vendors sell products at list price and mix them in with your contracted order without making it clear on your quote which items are discounted and which are not," he says. "If you're not sure, give your vendor a call with questions."
7. Work with your group purchasing company to verify your surgical instrument contracts.
If your surgery center works with a GPO, Mr. Edelstein says that it is important to take several steps to ensure you receive the best savings on your purchases.
"When using your GPO, verify that your contracts are current and in effect, with proper discount grading levels, before proceeding with surgical instrument purchases," he says.
"All paperwork must be completed by you and filed by your vendor before purchasing. Even after paperwork has been filed, pricing must still be loaded against your account. All of the above must occur to ensure savings, or you may be paying too much for your instruments."
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