Five Tactics to Ease CMS Cuts to OBL Reimbursement

Endovascular practices that are feeling the impact of the 10-15% CMS cuts in office-based laboratory (OBL) reimbursement need to act immediately to soften the blow and prepare for the future. Here are five tactics OBLs need to get right to stay competitive and profitable in the face of current and anticipated reimbursement cuts.

1. Shift site of service. Since many outpatient endovascular procedures can be performed at both OBLs and ambulatory surgical centers (ASCs), practices need to be smart and add reimbursement into deciding which to use. This could mean the difference between getting paid 10-15% less in the OBL or 10-30% more in an ASC. Run the numbers on the advisability of a hybrid or stand-alone ASC—and even more of the care continuum.

2. Get lean. Hone your practice’s cost structure for maximum efficiency, starting with big categories. Would you be better off concentrating your disposables with one or two vendors, or joining/switching a buying collective? Is that non-core service strongly accretive, or just distracting? Are your professional services too much, too little, or just right? Similarly, are your staff and employed providers at “Goldilocks” levels, and also aligned and productive? These factors are even more crucial if you’re starting up or expanding.

3. Top up the top line. Changes in reimbursement call for a closer look at patient volumes, payment rates, and revenue cycle effectiveness. Identify and plug leakage points in your patient engagement process, and reinforce your relationships with key referral sources. Renegotiate payment rates with commercial payors and hospitals, especially if they haven’t been adjusted for inflation or quality improvements. Make sure you’re getting paid what you should, whether you do revenue cycle in-house or outsource it.

4. Manage mix. Run the numbers and focus your practice on the kinds of patients, cases, and payors in your practice that produce the best results. If you find that these aren’t your largest segments, then fix that through marketing & patient engagement, referral network management, and hospital & payor negotiations. If your cost accounting and information systems don’t yield these kinds of insights, then get a good back-of-the-envelope done.

5. Partner up. This is no time to be a lone wolf. Now more than ever vascular surgery and interventional practices need to join with like-minded partners to achieve greater leverage & economies of scale, learn & adopt best practices, and synergize. Find a platform of other practices that match your passions, share your values, and honor the autonomy you want.

Running a successful OBL takes diligence, persistence, and skillful business acumen—especially in today’s environment. Aligning yourself with the right resources and partners, and running your OBL with the same attentiveness as you give patient care, will set you up for long-term, rewarding, and sustainable success.

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