Orthopedic device companies are building out strategies to capitalize on the shift of procedures from the hospital setting to ambulatory surgery centers (ASCs). To date, much of the emphasis has been placed on development of new products and supply chain management of those products. While those strategies are important, greater focus needs to center on relationship building between the device company and ASC leadership and surgeons, according to influential voices we pulled together for our OMTEC® keynote.
The healthcare intelligence firm Sg2 predicts that from 2018-2028, total hip outpatient procedures will grow +752%, total knee outpatient procedures will grow +580% and from 2018-2023, spinal fusion outpatient procedures will grow 56%.
The differences between the hospital and ASC setting are vast and present a learning curve for those managing, operating in and selling to outpatient centers. However, the growth opportunity connected to ASCs is significant for those companies that examine the big picture and build foundational relationships.
Neurological spine surgeon Robert S. Bray, Jr., M.D. has spent 20+ years in the ASC environment. The Founding Director of DISC Spine & Sports Center recently opened his third location in southern California. If device companies want to be successful in the ASC environment, he said, their relationship must extend beyond the traditional role of sales reps to a business advisor and partner.
“Rethinking the role of the contact person whom we deal with is critical,” he said. “We need a direct line of access to the company corporate (office) for answering and developing questions, not just our rep. I see things changing as less of the rep onsite delivery model and more of a training program where corporate comes in and brings in both. They're training the people for all these other business questions that frankly, historically, doctors have not been as good at and helping develop partnerships for those pieces.
“After an implant system is up and running and taught, we don’t need the rep here every time anymore. Then we need more of a restock seamless way to get the new equipment in, turn it over, bring it in. A rethinking of the model of how the delivery is happening is going to be critical and that is going to lead us to better cost efficiency.”
Dr. Bray emphasized that device companies need to send business development people to sit at the table with ASC leaders to better understand how the center functions. They should discuss what product offerings are available to surgeons and at what prices and understand how the choices impact the ASC’s cases as well as processes—from supply chain to billing.
“They should know our case costing,” Dr. Bray said. “We need to become an open relationship with them of how this market is developing so they can understand what are the margins and where their future lies with this development of the ASC. We need to work with them to know here’s a cost-efficient future and set targets and say, ‘We're here. We all need to be here on cost efficiency and outcome.’ ”
Rethinking Product Offerings
Joining Dr. Bray on the panel was Laura Rector, Smith+Nephew’s Vice President of Ambulatory Surgery Centers. The company has a team of 100+ individuals dedicated to the ASC space through its Positive Connections division. As Smith+Nephew has developed its strategy, it’s expanded its services to digital health and patient management and even partnered on billing services, which combined enhance the care model and answer unmet needs.
“It’s being built out specifically to do everything for a customer—patients, payors, surgeons, owner-operators—that has nothing to do with their traditional recon products,” Ms. Rector said of Positive Connections.
Of course, Smith+Nephew is focused on decreasing instruments in the operating room and its new joint replacement robot, CORI, is marketed as having a small footprint for the ASC. But Ms. Rector noted that when Smith+Nephew started asking ASCs about their biggest challenges, the answers were staffing issues, billing issues and of chief concern, how to attract patients.
Both Dr. Bray and Ms. Rector spoke at length about the role data will play as the ASC market expands. Data will be captured to examine cost, quality, patient satisfaction, outcomes and more. That data will be used to drive ASC improvement and profitability, evaluate partner relationships, and it will be used by payors that are deciding which procedures can be done at an ASC and to prioritize which ASC.
How does all of this loop together, Dr. Bray asked rhetorically. He answered by saying that there's opportunity for device companies to partner with ASCs across their business in order to spur market growth.
Patrick McGuire is an ORTHOWORLD Contributor.
You can access the full OMTEC Keynote, "Preparing for the Shift in Orthopedic and Spine Procedures to Outpatient Settings," at OMTECexpo.com.