Defining the Unique Information Management Needs of Surgical Hospitals


Defining the Unique Information Management Needs of Surgical Hospitals

By Scott Palmer

The outpatient surgery market is entering a new phase -- the widespread development of single and multi-specialty surgical hospitals. Today, progressive healthcare operators are developing this new type of facility in order to extend the types of procedures and services offered, as well as to offer new alternatives to acute care, hospital-based surgery.

Of course, surgical hospitals are not new. There are concept facilities that have been in operation for more than 10 years. In fact, estimates place the number of existing facilities and those under development at more than 100 facilities. The majority of current surgical hospitals, as well as many in development, are conversions of existing ambulatory surgery centers (ASCs). While there may still be legislative challenges to physician ownership of hospitals, the development of surgical hospitals is expected to increase significantly in the years ahead.

As with any new type of business, this market is attempting to define itself. An established pattern for ownership, development, financing, reimbursement and other important business issues has not yet emerged. Led by orthopedics, facilities are currently being developed for several different specialties and as the industry continues to develop, multi-specialty sites are expected to be the norm.

The information system requirements of surgical hospitals are different than those of ASCs, and they must be provided with the type of tailored, quality information system required to meet their specific needs. Of course, failure to select the correct information system will result in inappropriate capital expenditures, inadequate or cumbersome functionality and the erosion of relationships, service levels and profits.

Compared to ASCs, surgical hospitals have more advanced needs and requirements in several key areas, including:

  • Scheduling and conflict checking
  • Census reporting
  •  Admission, discharge and transfer (ADT)
  • Cost accounting and analysis
  • Revenue analysis
  • Charge master maintenance
  • Contract maintenance
  • Coding
  • Claim submission and data requirements
  • Departmental integration
  • Regulatory requirements
  • Federal and state reporting
  • Accreditation
  • Outcomes reporting

Otherwise, surgical hospitals will likely be managed very similarly to ASCs. The success of surgery centers has been based on the premises of providing outstanding care to patients requiring elective surgery, creating high satisfaction levels to physicians who may be dissatisfied with the level of care or responsiveness to physician needs provided by the local hospital, and keeping fees low by careful monitoring of costs. This model has proved extremely successful, and these factors will be key drivers for success in the surgical hospital market. Surgical hospitals are best served by seeking suppliers experienced in serving the ASC market that support and understand these priorities.

Surgical hospitals currently have three choices when selecting an information system:

Purchase a surgery center system. These systems are designed with several objectives in mind. The first objective is to support an environment that provides exceptional service levels to physicians and patients. Secondly, the software should ensure operational efficiency. It is understood that surgery centers operate with minimum staffing levels and that employees typically perform several roles. Lastly, the software should be engineered in a manner to control acquisition and ongoing costs. Surgery centers don't have substantial information technology budgets. These facilities require an information system that can be purchased for a reasonable initial investment, typically in the area of $60,000 to $100,000. This requires that the software operate on standard client/server or Web-based technology and can be managed without an internal IT department.

Purchase an acute-care hospital system. While these systems typically have robust functionality and meet nearly all of the requirements of an acute-care hospital, the majority of this functionality will not be used by a surgical hospital. Acute-care systems typically cost in the range of $250,000 to $1 million for initial investment and implementation, with significant ongoing support costs. These solutions also require a longer implementation and training cycle and require more ongoing attention and support.

Build a "best of breed" solution. Surgical hospitals can build a custom solution internally by selecting products to meet the needs of multiple departments. Although this approach has been used in acute-care settings for many years, the preference has been to avoid this approach in favor of purchasing an integrated solution from a single vendor. Normally, surgical hospitals simply don't have the project and information management skills to manage, integrate and support all of the various products.

Any surgical hospital technology solutions provider should be committed to assisting its customers in maximizing the investment in their products and services. In order to do so, the vendor must realize that it's necessary to do more than simply training customers to use its products. Surgical hospitals must select a vendor with an established track record in working with surgical facilities, a commitment to providing the comprehensive functionality required, a proved implementation process, quality ongoing support and the financial resources to compete in a consolidating market. Lastly, as this market evolves, surgical hospitals should insist on a commitment to update the application as required to meet emerging industry and regulatory requirements.

Compared to acute-care hospitals, surgical hospitals have less data processing requirements and far less patient and transaction volume. The surgical hospital's operating philosophy and style is much more closely aligned to the ambulatory surgery model -- which is driven by patient and physician loyalty, satisfaction and cost control. However, there are substantial differences between the automation requirements of a surgical hospital and an ASC. Surgical hospital operators should seek an information management system that supports the operating efficiency of a surgery center, as well as focuses on providing extraordinary service to patients and physicians, without the complexity and cost of a system designed to meet the specific needs of an acute care facility. Current surgical hospital customers, as well as those developing new surgical hospitals, have confirmed this to be their intention in selecting a system to manage their facilities.

Scott Palmer is group vice president of surgical solutions for Source Medical (, a leading developer of outpatient information solutions, with products used in more than 3,500 facilities. Prior to joining Source Medical, Palmer was CEO of Health Information Systems (HealthIS), and was also the founder and CEO of Temple Information Systems.


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