The number of office-based facilities has been increasing steadily over the past several years—and more vascular surgeons may be considering becoming involved in operating such centers.
To help vascular surgeons consider the various details involved, the SVS Subsection on Outpatient and Office Vascular Care (SOOVC) held a special membership section session on The Business of Running an OBL (office-based lab) during VAM 2023 in June.
Among the standout presentations included, Neil Poulsen, MD, from Cardiovascular Care Group in Springfield, New Jersey, delivered a talk entitled “The financial viability of the OBL” during the session.
Top of mind, the number of office-based facilities increased 49% from 2002–2012, he told those gathered. OBLs provide ease and access to care, improved patient satisfaction, and excellent outcomes; they limit hospital exposure; and they increase efficiency, Poulsen pointed out.
In light of recent coverage of overuse of certain procedures, Poulsen said, his presentation assumed “appropriate use by trustworthy/ethical practitioners practicing evidence-based medicine.”
In terms of financial viability, the first step is to identify the three stakeholders: the patients, practitioners and the overall medical system, he continued. “If one is out of balance, the whole system falls apart,” Poulsen said.
As for safety, he cited research showing that among 6,021 procedures in a particular OBL, there were no office-based mortalities, major bleeds, acute limb losses, myocardial infractions, strokes or hospital transfers within 72 hours, and a 0.5% rate of minor complications. “We do have the evidence that use of OBLs is equal to procedures performed in hospitals,” Poulsen said.
As far as providers, an OBL practice can offset continuing declines in the professional fees for vascular interventions, allow for a more patient-centered practice model, avoid the headaches of dealing with operating room turnovers and access to block time as well as hospital policies, allow for referrals that may have gone to competing practices, and provide a new and increased revenue stream for the vascular practice.
Research from 2020 highlighted 2017 fees for certain procedures, including a balloon angioplasty for which the physician was reimbursed $482. The hospital reimbursement was $4,592, but the provider in the outpatient facility received not only $482 in physician reimbursement but also $2,288 for the facility reimbursement, for a total of $2,770.
Other research showed significantly increased revenues in one center, with physician reimbursement for a thrombectomy in an outpatient setting nearly quadruple that performed in a hospital. “In 12 months of procedures in [this] OBL, revenues increased approximately $1.3 million,” he said. Total reimbursements for a group of procedures (with both the provider and facility fees) was nearly $1.7 million, compared to $368,897 for the provider reimbursement alone. Of course, revenues must be weighted against the increased responsibility of owning and operating an OBL, he said, with set-up and building costs that could reach $500,000 to $1 million. Other costs involve investors, staffing, supplies and acquiring patients.
The healthcare system as a whole saves money as well. The success of the outpatient practice model is directly related to its ability to provide high-quality patient care while reducing waste spending, and the transition also helps to conserve hospital and inpatient resources, Poulsen said.
Data from his own group showing 1,741 procedures in a single OBL over 12 months showed hospital-based fees of $2.9 million and OBL fees of nearly $2.5 million. The Medicare system saved $462,443, or 18%, he said. Highlighting code 36902 (fistulagram with percutaneous transluminal angioplasty [PTA]), with 443 performed in a year the medical system saved 38% by having the procedures performed in an OBL.
His group realized increased revenues of $2,453,652, compared to $376,199 for the hospital-based procedures.
Poulsen concluded by stating that the success or failure of an OBL depends on optimizing outcomes for all stakeholders. OBLs provide a safe, efficient and effective environment for patient care, he continued, and the transition of care from the hospital setting to the OBL is associated with a significant reduction in overall healthcare costs. The financial success of an OBL is driven by the ability to limit expenses while providing high-quality, safe and evidence-based patient care, Poulsen added.
“You’ll note I didn’t say anything about improving revenue,” he told attendees. “The revenue is going to come,” Poulsen emphasized. “Don’t go out of your way to improve revenue only. You want to limit your costs and provide appropriate patient care.”