The Entrepreneur I liked the article “The Entrepreneur” (PSP cover story, November 2006; PlasticSurgeryProductsOnline.com/archives.php). I was wondering about the reference on page 16 to the surgery-center fees. I recently joined about 100 other physicians in building a hospital. I am the plastic surgeon in the group, and I had to set fees for aesthetic cases like augmentation.
I set the fee at $850 for the operating room and $500 for the anesthesia. The time is about 1 hour. This is similar to the other surgical centers in the town, and interestingly close to the $700 in your article.
Our CFO was a little surprised at first. But, as your article implies, I guess a surgery center makes more per hour from heart surgery and maybe some orthopedic cases.
However, my question is: In orthopedics and heart surgery, is more overhead involved? For example, the costs of grafts to fix a knee or the joints themselves, which are very expensive. Were the costs in the article of $4,000 to $6,000 for arthroscopic surgery pure profit to the surgery center, or is this surgeon hype and wishful thinking?
I know for a fact that some surgery centers in our town turn away orthopedics because of expensive joints and equipment, which in the end actually lose money. This is of interest to me, of course, because I wish to feel valuable to the hospital.
James A. Rieger, MD Wichita, Kan
The subject of the story replies: Our surgery center charges $1,050 for a 1-hour augmentation and $1,150 for a 1½-hour augmentation; our cost is $700 (not including the implants, which are paid by the patient). On the other hand, we charge $7,505 for a knee arthroscopy with anterior cruciate ligament repair, we are reimbursed $4,065, and our costs are $2,103 for a 2-hour case.
In general, orthopedic surgery is more profitable for a surgery center than is plastic surgery; everyone in the industry agrees with that. On top of that, our management partner, Regent Surgical Health, has made us aware that our charges to the insurers are still 40% to 60% below those of the hospitals in this area.
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