1. Include surgeons at every step of the process. Orthopedic surgeons are essential to the overall success of your surgery center, both on the clinical and business end of operations. Since they are the ones who are going to use the implants, it is critical to bring surgeons in early on the decision-making process. With a large choice for implants and manufacturers, it may be difficult for ASC administrators to be certain they are getting the best value for their money. Surgeons can aid in the process because they will be able to evaluate the quality of implant as well as the knowledge and honesty of the sale representative.
2. Work for a contract with added benefits. Rather than defaulting to a traditional “buy-and-sell” contract, orthopedic-driven ASCs should work diligently to iron out a contract that can provide added benefits. Creative contracting can be achieved in a variety of ways, including extended warranties, free training or free supplement equipment. This is a strategic way to keep costs of orthopedic supplies down, especially in situations where suppliers are vying for your facility’s business.
“It can be something as simple as receiving free accompanying equipment with a big purchase of the supplier’s orthopedic devices, such as implantable screws,” says Elaine Thomas, administrator at St. Francis Mooresville (Ind.) Surgery Center. “Orthopedic suppliers are trying to help surgery centers keep the costs down [in order to lock in those business deals], so there is definitely the possibility of ASCs getting into some more creative financing.”
3. Emphasize exclusivity with the company. Since steeper discounts are offered on implants as more devices are ordered, ASCs should work to reduce the number of vendors they order from. This practice also standardizes and streamlines the devices and implants used at the ASC, which contributes the the center’s profitability. Jay Rom, president of Blue Chip Surgical Center Partners, says using only 1-2 major vendors allows the ASC to negotiate exclusive contracts offering better pricing.
Donna Lahey, the administrator of Spine Institute of Arizona in Scottsdale, also utilizes this tactic. At renewal time, Ms. Lahey says her practice tells vendors “I’d like to stay with you but if you can’t lower your rates, I’m going to have to go somewhere else.” She adds, “Not a single vendor walked away from that.”
4. Bring multiple devices to the table. Know the expiration dates for existing contracts and be prepared to renegotiate according to the current economic landscape. Do your industry research beforehand so you know what technology is available and compare prices across the board. During the process, bring three different products to the table, including the one already being used, and compare the value of each device before deciding which to purchase, says Michael Franks of Physician Business Services in Tampa, Fla..
