Smaller ambulatory surgery centers report higher net incomes

December 1, 2005

Smaller ambulatory surgery centers continue to report better net incomes per case than their larger counterparts, while larger ASCs report lower operating costs, according to a newly released report from the Medical Group Management Association.

Smaller ambulatory surgery centers continue to report better net incomes per case than their larger counterparts, while larger ASCs report lower operating costs, according to a newly released report from the Medical Group Management Association.

Smaller ASCs (those with fewer than 3,000 cases per year) reported a mean net income of $473.02 per case, while ASCs with 3,000 or more cases per year received $341.32 per case in 2004, a 27.8% difference.

“Smaller ASCs may be experiencing higher income because of higher utilization of their operating rooms,” said David Schlactus, MGMA member and CEO of Willamette Surgery Center, Salem, OR. “Also, smaller ASCs may be performing more profitable procedures more often, especially single-specialty ASCs.”

Likely because of economies of scale, the largest ASCs still pay less for medical and surgical supplies and total operating costs per case than the smallest ASCs. The MGMA report indicates that ASCs with 1,999 cases or fewer per year paid $228 per case for medical and surgical supplies. ASCs with 5,000 or more cases per year paid only $185 per year.

These economies of scale may add up for the largest groups in total operating cost performance, as they reported $614 spent per case versus $802 per case for the smallest ASCs, according to the report.