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December 16, 2016

The Proliferation of Anesthesia Management Companies

December 16, 2016

anesthesia management companies

The past decade has brought about a great expansion of the market share of anesthesia services by anesthesia management companies (AMCs). But what does this mean, and what are the pros and cons? Read on to find out with Medical Business Management.

What Do Anesthesia Management Companies Do?

AMCs take advantage of their large networks to get higher rates from commercial insurance providers. Then, they utilize their control over the market to lower employee compensation costs. They are buying private practices across the United States at a rapid pace, and they are owned by investors who are motivated by profit.

What Do Proponents of AMCs Say?

Those who support AMCs suggest that there is a decrease of costs of benefits based on the economy of scale. They also say that the negotiation of higher commercial insurance rates causes a decrease in the cost of subsidies paid for by hospitals.

Are these suggestions wrong? No, but the same results can be achieved via other methods. For example, superior employment cost savings can be realized by following CRNA-only and collaborative models, and eliminating providers with high costs and low revenue.

What Do Opponents of AMCs Say?

On the other hand, those who oppose AMCs providers will work harder for less money if a third-party entity (which demands revenue and increased profitability each quarter) is added. Another consideration is that AMCs often have their own way of doing things, which doesn’t always take into account a facility’s unique needs.

But possibly the greatest negative here is that there is no incentive to go above and beyond the standard requirements. If a provider is paid a flat hourly rate or a salary, with no incentives or ownership, then they will likely stop working when their shift is over. That means no staying late for extra cases, which is normal in a fee-for-service setup because each case adds more income. It also means no concern for turnover, because more cases just mean more work, but no more money.

In fact, the incentive is to work less… not more. Pay is the same, so why work harder when there’s no payoff to doing so?

Medical Business Management Is Here for Your Practice

Whether you need help with pain management billing or claim coding, MBM is here to help you keep your focus where it belongs – on your patients. Contact us today to find out how we can decrease the stress of running your practice!

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