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By Stephen W. Earnhart, MS
Earnhart & Associates
The kids are back in school (Thank GOD!), the heat is starting to break, the floods are receding, and the fires are burning out.
It was an interesting summer. I spoke at several conferences, and I have to say that the Gulf States ASC Conference & Tradeshow in Biloxi, MS, was one of the best conferences I have had the pleasure of speaking at. The Ambulatory Surgery Center Association conference in Orlando was great too.
These conferences left me with a question: How many of your centers and hospitals are paying someone or some company a management fee? How much? Are you getting ripped off? Well, according to the results of a survey by HealthCare Appraisers in Delray Beach, FL, 56% of centers are paying between 3% and 6% of the net revenue of the center for the pleasure of telling you what to do. For hospitals, the average is about $25,000 per month, not including personnel. Are you in that range? Are you angry? (For information on how to access that report, see note at end of the column.)
A. Here are some questions for you from that survey. See how many you get right.
B. Here are some of my questions based upon responses from the conferences I spoke at over the summer (not quite as sophisticated):
OK, that was fun. However, on a serious note, most of us are concerned about the future of our industry. But the reality is that we need to focus on what we can do at our own workplace and not worry about the global issues. I will recommend that all of you Google the following words and understand their meaning. These words are going to impact your lives over the next 10 years to a much greater degree than ever. You need to understand them.
* cash flow;
* Return on Investment (ROI);
* Stark law;
* Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA);
* economic credentialing;
* passive investor;
* one-third one-third regulation;
* under arrangement.
Most of you know this stuff, but it still is a good exercise.
C. Last question for the ambulatory surgery center group: "Who is the most important person in your facility?"
D. Last question for hospital staff: "How many meetings do you attend per week?"
Answers for questions from group A:
Answers for questions from group B:
Answer for questions from group C:
Answers for questions from group D: