4 Reasons Why Part III: Changing Industry and Demographics
Don’t overlook less obvious drivers for ongoing site-of-service transformation. M&A patterns and shifting needs with new and aging generations alike are driving ASC and office surgery.
Beyond the cost savings and patient satisfaction, changing Industry and demographics are driving today’s site of service transformation. Consider mergers and acquisitions on massive scales, like CVS-Aetna’s acquisition of Oak Street Health and Optum’s 8 billion dollar acquisition spree last year, as well as significant, but more subtle market indicators like anesthesia platform AMS, a pioneer of office-based anesthesia, adding Texas’s Noble Anesthesia Partners and M2 Anesthesia in the Pacific Northwest to its partnership portfolio.
Transactions like these can signal a growing ability for physicians to exercise greater control over where and when they treat their patients. Put another way, the growing landscape of “payvider” organizations are getting on board with ASC and office procedures, and supportive services like anesthesia are increasingly available. This, in turn, expands physician control even further than they may realize, to better control costs for patients and their proportion of charges; more often than not, the in-office procedure model is more affordable for the patient and more profitable for the physician.
Additionally, generational differences are also driving this site of service evolution. The needs and goals of baby boomers in comparison to millennials in terms of physicians and patients are vastly different. Younger generations of physicians wants to make a name for themselves, but see the reality of doing so while maintaining a healthier work-life balance– a choice that is incredibly beneficial for themselves and their families, but also patient outcomes. A less stressed clinician is more able to focus. This is leading to an increased clinical interest in establishing private practices that focus on office-based surgery and procedures, or working for other practices that allow them more creativity and freedom such as concierge businesses and other 9-5 situations are ideal. In the wake of the COVID-19 mass shuttering and acquisitions of smaller private practices, something originally considered a death knell, is revealing itself to be an invigorated “blue sky” opportunity for new practices to launch.
On the patient side, the tech savviness of digital natives like millennials, who are now approaching their mid 40s and taking up a larger footprint in procedures, are accustomed to booking appointments online, looking at wait times, and reading physician reviews. With so much information available to patients, providers must find new and creative ways to differentiate themselves to achieve long term success. This includes extending the convenience of online access to providing alternative sites of service that are more convenient and cost-effective. Ironically enough, in a post-pandemic world where hospitals became a hotbed of transmission, older patients that may be more at risk to nosocomial infection are additionally interested in procedure opportunities with lower overall patient volume and higher staff ratios, reducing their risk.
Most major innovations in healthcare that impact cost are seen as a soft detriment by patients, whether they realize it or not, with more impersonal interactions, longer waits, etc. The return of visiting a smaller doctor’s office, and the rapidly growing opportunity of ambulatory surgical centers, are having the opposite effect. It’s an exciting time to practice and there are frankly no two ways about it: Changing industry and demographics are making office-based procedures are the way of the future.
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