Summit Orthopedics has a major presence in Minnesota's Twin Cities with four ASCs, about 30 orthopedic locations and about 860 employees.
Becker's ASC Review recently spoke with Summit Orthopedics CEO Adam Berry about the state of and challenges in the ASC market, Summit's growth, Summit's plans to become a future looking ASC with a focus on technology and specialization and how Stryker's ASC business was able to break through during the request for proposal process with its breadth of products, focus on the future and specialization in the ASC market.
Driven by vision
Summit Orthopedics is guided by its vision to be the premier provider of all musculoskeletal services for patients in its community. This requires offering a broad range of musculoskeletal services. Often, when a patient is in pain, they don't necessarily know what's wrong. They may have hip pain, for example, which is being caused by a back issue. This focus on everything musculoskeletal means, "We have to have a good enough and wide enough range of services to cover everything," Mr. Berry said.
For Summit, this expansive vision has meant going upstream to assist employers in creating work environments that prevent employees from getting injured, via their Occupational Medicine programming. It has also meant going downstream to provide clinics, surgery and even telehealth follow up.
ASC challenges
Summit started its first ASC 22 years ago in 1999, and Mr. Berry has been with the organization for 11 years. During this time, a constant challenge has been communicating the benefits of an ASC to the broader market.
In 2012 and 2013, when Summit was putting together its first ASC bundled contracts, payers recognized that bundled payment would save money on each unit but were worried that their total costs would increase because the number of units would increase. Summit had to educate payers at that time about patient selection criteria and that their total costs would decline.
Then the education challenge shifted to patients. At the time, patients had the mindset that surgery takes place in a hospital. Also, many patients had no financial incentive to use an ASC since deductibles of $5,000 or $8,000 could be easily exceeded by the $20,000 cost of a procedure. Overcoming this challenge required educating patients about the quality, convenience and overall total cost advantages of ASCs.
More recently, the communication challenge has shifted to large employers. These employers want to engage in direct contracting but are frustrated by having to have separate agreements for different clinical areas, such as orthopedics, ophthalmology and more. This has required educating employers about the substantial benefits of ASCs and streamlining the contracting process.
Mr. Berry observed that it has been a continual challenge to educate different stakeholder groups about the benefits, costs savings, quality enhancements and overall benefits of ASCs.
Constant reinvention
Summit has done total joints in the outpatient setting for almost eight years. But looking forward, it is important not to get complacent. It is necessary to figure out what's on the horizon. "Business as usual is not the business of the future," Mr. Berry said, their priority is "to remain relevant in the marketplace," he added.
Remaining relevant is a constant challenge, Mr. Berry said, because the market says it cares deeply about quality, but doesn't know how to describe it, and the market says it cares deeply about price, but doesn't know how to shop for it. "The quality and cost concepts are sometimes difficult," Mr. Berry said. The ongoing challenge is to remain relevant and not to be locked into business as usual.
Summit's hyper-specialization
One way that they have remained relevant is by going beyond the general concept of orthopedics into specialties and subspecialties, which Mr. Berry termed as "hyper-specialization." For example, one of their surgery centers only does procedures from the elbow to the fingertip, while two other surgery centers only do joints and spine. A fourth ASC only does spine injections. Mr. Berry asserted that this focus provides expertise, innovation and nimbleness.
ASCs vs. hospitals
Over the past decade, as patients, providers and payers have become educated about ASCs, the perception of ASCs has improved, while the perception of hospitals has taken a hit, according to Mr. Berry. He argued many patients no longer want to go to hospitals, due to concerns about COVID-19, cost issues, service issues or other concerns.
Mr. Berry said the contrast and advantages of ASCs are evident. ASCs have a smaller feel, are focused on a particular specialty and help patients more smoothly navigate the entire experience. This can include a simpler parking experience, a better experience in the facility and having specialized nurses who deal with fewer patients each day. "We can effectively deliver those touch points differently than the bigger setting that has to be all things to all people," Mr. Berry said.
Partnering with Stryker
A priority for Summit over the past 18 months has been forming a future-facing strategic partnership for a broad range of technologies and medical supplies. After a rigorous request for proposal process, Summit selected Stryker and initiated a multi-year relationship that went into effect on Feb. 1.
Summit had a positive impression of Stryker prior to the RFP process, based on years of good representation, trusted relationships and a history of good products and technologies. But Summit's selection of Stryker was less based on the past and more based on the future.
Why Summit chose Stryker
Summit Orthopedics established several criteria including:
- A shared vision. It was essential for Summit to have a partner with a shared vision focused on getting the best products to patients and to physicians.
- A common voice. Summit didn't want to deal with multiple separate divisions and didn't want to have to navigate inside of large organizations. Stryker took what was previously 13 divisions or service lines and coalesced into one unified voice.
- Forward thinking. Summit wanted a partner that was forward thinking on trends, technology, products and service delivery. Summit asked, "Who is it that's forward-thinking enough to keep up with our ambition to be relevant and to make sure the business of the future is not business as usual?"
- Cost. Summit's values highlight the need for stewardship with the healthcare resources, so cost was a consideration.
- Standardization. To eliminate any unnecessary deviations, Summit wanted standardization in products and processes. This meant fewer vendors and fewer products, which allowed for easier onboarding of staff. Mr. Berry's team wanted to make products and processes "as easy, seamless and interchangeable as possible, so we can focus on delivering the care rather than the instrumentation. That's why standardization was a really big piece."
A physician-led process
When working through standardization and product decisions, Mr. Berry explained, "The physicians are the decision-makers . . . it was a physician-led process, because they are the individuals responsible for the care and safety of the patients."
To help educate and train surgeons, Stryker provided a mobile van with a cadaver lab. This provided the ability for surgeons to gain hands-on experience with unfamiliar products and when evaluating robotics. "I think it made a big difference," Mr. Berry said.
Positive initial results
While this deeper relationship with Stryker's ASC business has only existed for one quarter, the initial results are extremely positive. "It has exceeded our expectations," Mr. Berry said. "Both parties have viewed it as wildly successful in the first few months. . . And even though it took about a year to get us to this decision point, sometimes it's about the journey, not the destination. And the journey has made us better and stronger."
Adam Berry is a customer of Stryker. The opinions expressed by Adam Berry are those of Adam Berry and not necessarily those of Stryker.