Turnarounds – What Causes Them? How Do We Fix Them?

When Regent began, our primary focus was turning around underutilized surgery centers, and it remains a critical part of our business. Turnarounds represent at least half of our new projects.
 

When we commence a new turnaround project, we always seek to avoid repeating the mistakes of the past. Once we have succeeded in turning around a center, we work to prevent “slippage,” so we don’t fall back into the habits and activities that caused the problems initially.
 

We have identified five core categories that encompass the 17 major mistakes centers make that cause them to fail. 

     I. Revenue
          A. Contract rates below costs
          B. Chargemaster too low
          C. Slow ramp up of cases

     II. Recruiting Physicians
          A. Recruiting too few
          B. Recruited wrong doctors
          C. The busiest doctors left

     III. Human Resources
          A. Wrong administrator
          B. Poor director of nursing
          C. Poor marketing to schedulers
          D. Poor staff morale

     IV. Costs
          A. Supply costs too high
          B. Labor costs too high
          C. Information Technology problems
          D. Bad case mix
          E. Too few cases

     V. Financing
          A. Too little equity
          B. Too much debt

Over the next five weeks, I will share what we have learned, offering details and insight on each of these five areas. In our experience, these activities are insidious. Like weeds in the garden, they must be eradicated. As partners, we ask your help to identify these actions and help us eliminate them from our businesses. Please contact me, your Regent board member or your administrator if you recognize any of these crippling practices rearing their ugly heads in your center. It takes diligence by all of us to ensure consistent long-term performance for our businesses in the ASC industry.
 

Thomas Mallon
Regent Surgical Health
P. 708.686.1522
F. 708.492.0547