The Profit Right Under Your Nose

While total joints and robotics are shiny new objects, lesser-known GI procedures could yield the new revenue you need. 

Ambulatory surgery centers (ASCs) are an odd beast. They are an enigma to the novice operator, often resulting in failure on multitudinous fronts. The savvy physician or administrator, having gone through years of missteps and falls from the horse, knows how to tame this beast, and sow the rewards bestowed on them once they master this art.

Revenue-boosting procedures

Having invested more than two decades in building, running and managing ASCs, I have concluded that nothing produces more revenues, pound for pound, than gastroenterology procedures. Our ASC franchise, Atlas Surgical Group, specializes in spinal and orthopedic surgery, GI, ophthalmology and gynecology, and performs tens of thousands of surgeries every year. Take it from the horse’s mouth, the true profits come from GI. Unfortunately, many surgery center operators don’t realize how performing GI procedures can allow them to truly capitalize on this specialty’s gains.

GI remained about one-third of the average caseload at ASCs from 2018 (34%) to last year (32%), according to VMG Health’s Multispecialty ASC Benchmarking study. That makes sense, since there’s never a shortage of colonoscopies and esophagogastroduodenoscopies (EGDs or “upper endoscopies”), and it doesn’t make sense to go after other outpatient GI procedures that don’t pay much. To quote a recent article from Gastroenterology & Endoscopy News, “We are in the Golden Age of older rectums”— from a supply side, at least. Elderly people will make up 20% of the population by 2030; reducing the age for the first colonoscopy screening to 45 adds three million patients to the rolls; and there’s still a huge backlog of these procedures taking place because millions postponed their screenings during the pandemic. 

Up to $1,000 for a 10-minute case

An EGD takes seven to 10 minutes and requires propofol, a CRNA, two nurses, a tech and roughly $8 in supplies. You will net $800 to $1,000 for each of these upper endoscopies from a private payer. Juxtapose that with a Medicare total knee, which takes up to three hours to complete. You need an eight- to 10-person crew, ranging from the $35-an-hour scrub tech to the first assistant, who gets $75 to $80 an hour. Throw in the cost of general anesthesia, anesthesia time, supplies and hardware and you will be lucky if you net $1,000 in profit from a half-day endeavor.

Now do the math. What will three EGDs an hour for three hours net you vs. one total joint replacement in that time (including its staffing and equipment costs) that will sop up all your profits? EGDs and colonoscopies provide more profit per minute than anything else in an ASC. Trust me, I would know because I have seen it all and billed it all. 

We’re so busy with esoteric new machines and service lines, we forget the bread-and-butter procedures that put us on the map are the most lucrative.

In addition to these standard procedures there are multiple different GI procedures that, if truly utilized with the right clinical indications and billed correctly, can be similarly profitable. The heavyweights in this business know where that money is, but unfortunately many ASC operators simply don’t know about them. Here are some of the profitable additions you can make:

• Simple ERCPs. Endoscopic retrograde cholangiopancreatography (ERCP) can be a complicated procedure that includes a potential sphincterotomy together with its possible attendant complications and post-op care — and should rightfully be done in an inpatient setting. We can, however, perform simple ERCPs such as stent removals, stent placements and balloon extractions in an outpatient setting. The CPT codes for these procedures, 43274-43276, typically pay $1,500 to $3,000 in facility fees. The procedure and its post-procedural care run similar to an EGD and can be managed quite efficiently in an ASC. Performing these would require a standard scope that costs about $40,000 and a C-arm. 

• Endoscopic ultrasound (EUS). This procedure, similar to an EGD, can be used for a myriad of extra indications. With the changing guidelines for pancreatic cancer screening and the increasing indications for the use of endosonography in gastrointestinal diagnosis and staging for malignancies and chronic abdominal pain, EUS is basically a gold mine for ASCs waiting to be explored. While you need a highly trained gastroenterologist to be able to perform this procedure, the potential is huge should you find such a practitioner. Typical Medicare EUS reimbursements (CPT 43259) are roughly $800 — and two or three times that from commercial insurance companies. A subset of EUS is EUS with a celiac plexus block for chronic pain secondary to chronic pancreatitis or malignancies. It is slightly more invasive, but it can safely be performed in an ASC setting. Reimbursements for this run similar to those for a standard EUS, the complications rates are minimal and the patient volume is huge. This requires a special tower and scopes, with a fixed upfront cost of about $200,000.

TRIED AND TRUE Adding new GI offerings at ASCs can bring in more profit than many other in-vogue specialties.

• PH monitoring. This option can generate significant revenues for an ASC, entailing a quick procedure that pays fairly close to an EGD. 

• BARRX ablation. This endoscopic ablation of Barrett’s mucosa can be safely performed in an ASC setting with a significant return on investment. The historical indications for BARRX ablation include Barrett’s with dysplasia or early esophageal malignancies. Having said that, there are increasing indications coming into play for performing BARRX ablation for nondysplastic Barrett’s esophagus, the most common presentation of this condition. Certain indications in this setting include patients with a history of nondysplastic Barrett’s esophagus and a family history of esophageal cancer, plus a few other very common risk factors. There is a possibility, in the near future, that Caucasian men above a certain age might be considered candidates for screening for Barrett’s esophagus given the high risk of esophageal damage from overt or silent acid reflux in this patient demographic. Should that indication take effect, it will open the door for potentially hundreds of thousands of new cases across the country, and a potential for an exponentially increased usage of BARRX ablation for patients. The CPT code for BARRX ablation (43229) can generate close to $2,000 with government payers, and significantly more with private insurances. 

• Hemorrhoid ablation. This procedure can be used extensively in an ASC setting. It is safe, effective and painless and, in spite of a high cost for the instruments used with this procedure, can generate significant revenue streams for ASCs. Supplies for this procedure are approximately $500. Reimbursements range from $1,500 to $2,000 for a quick, painless and highly efficient procedure.  

• Endoscopic gastric balloon. This procedure is being used increasingly for obesity and can generate profits of $6,000 to $8,000 for a one-hour operation. While most of the 25% of the U.S. population that is obese cannot afford the financial outlay for this cash procedure, Medicare should soon have CPT codes for it. Once CMS generates the codes, the next step for providers will be to negotiate the rates up to a level where it is financially feasible for ASCs and HOPDs to offer this service. That day is not far off, and given the sheer volume of patient population waiting to be considered for this, I would not be surprised if the sales of gastric balloon systems take off stratospherically in the next few years. The balloons cost around $1,800 per procedure. 

• Cellvizio chromo-microendoscopy. This endoscopic technique is used as an aid to diagnose reflux-related complications among its myriad of indications. It incorporates laser technology to generate images of the internal microstructure of tissue, and in GI is used to diagnose goblet cells and intestinal metaplasia as an aid to an EGD. This leads to improved yields in endoscopic diagnosis of Barrett’s and early esophageal malignancies and can be used as a positive predictive option as well as a negative predictive option. The financial reimbursement for this procedure, CPT 43252, is quite decent in an ASC setting. Supply costs are minimal, the most expensive being around $300 for the catheter. 

• InterStim spinal implant placement. This two-part procedure is for patients with fecal incontinence who have failed to respond to conservative therapy. The initial test involves a micro-wire placement in the sacral nerve spaces and is performed by gastroenterologists to see if the patient is a good candidate for a final implant placement. If so, a surgeon next performs a spinal generator placement.

The procedure is 30 to 60 minutes, and its CPT code (64561) generates close to $5,000 by Medicare for the bilateral wire placement. Supply costs are minimal — about $250 — and takes about 45 minutes. Compare this to a time-consuming, staff-intensive one-level outpatient spinal fusion, which will bring you only $1,000 to $2,000 more and take up a half-day of your ASC’s time. 

• Endoscopic therapy for gastroesophageal reflux disease (GERD). These procedures never really took off due to a lack of insurance acceptance but are making a resurgence. The Stretta procedure is one of the most well-known and this cash procedure can generate $3,000 to $4,000 net profit per patient. Other endoscopic gastro-surgical procedures for acid reflux and weight loss are also on the horizon and are the next frontier in GI.

Where to start 

I’ll offer three suggestions on how to expand your GI service line: 

• First, cast a wide net when looking for providers and patients. Looking beyond your immediate neighborhood can net you both. You don’t need to stick to your local health system when looking for surgeons or stay within your immediate zip code while seeking out patients. 

• Two, think beyond the box. If you can’t find new specialists, encourage the physicians who perform EGDs and colonoscopies at your facility to attend seminars and take educational courses to allow them to do some of these additional procedures, such as the gastric balloon procedure. 

• Finally, adopt a creative and entrepreneurial mindset. This can be difficult in health care, because you can make money even when you remain stuck in the same lane your entire career. Realize there’s much more out there if you broaden your horizons. This isn’t experimental surgery, after all. They’re all established and approved procedures with rock-solid indications. The sky’s the limit once you start thinking along these lines.

I understand that everyone wants to do spine surgeries and discuss arthroscopies in the ASC. There is a demand for them and, yes, they can be lucrative. I contend, however, that the real appeal is because it’s considered progressive to do so, and what gets lost in translation is the amount of effort it takes to incorporate these specialties. I will take the revenues generated by an EGD any day over a complicated spine surgery and its potential complications. 

Don’t misunderstand me — it’s wise to look to newer ventures for growth, but the success and standing of any business comes from its past. Ambulatory surgery owes its exponential growth to GI. The sooner ASC owners and administrators realize its potential for growth and spend time capitalizing on it, the sooner they will see their numbers multiply. OSM