By Epix Healthcare

By Tim Adams, M.D., President and Chief Medical Officer, Epix Anesthesia

Of the 179 health systems surveyed by Modern Healthcare in 2014, more than half saw their operating margins “deteriorate” over the year prior. Hospital administrators are expected to do more—improve patient care, optimize revenue, increase patient and physician satisfaction—with fewer resources, declining reimbursements and less financial security.

The OR can generate up to 70 percent of a hospital’s revenue, according to HealthLeaders Media. This significant contribution to a health system’s economic viability, paired with the declining reimbursements and increased financial strain on the healthcare industry itself, positions the anesthesia department in a critical role regarding the success, growth and stability of hospitals across the United States.

Please see below the challenges hospital leaders face with mismanaged anesthesia departments as well as the ultimate benefits of transitioning to a better clinical partner.

The Anesthesia Quandary

While many hospitals have sustained a positive partnership with their anesthesia department, others are faced with significant challenges. According to a study by the American Society of Anesthesiologists (ASA), 47 percent of hospital administrators have reduced OR hours or redirected procedures due to anesthesia staffing issues.

Problems with scheduling, staffing issues and delayed procedures not only interrupt a health system’s cash flow, but also create dissatisfaction among surgeons and patients alike. While clinical staff complaints may increase, patients are highly inconvenienced and at risk for poor clinical outcomes due to delays, disorganization and mismanagement.

Reduced OR hours can directly jeopardize efficiency and increase costs. And while these inefficiencies may persist, 70 percent of hospitals pay their anesthesia department a subsidy of up to $3 million annually to cover the cost of labor, according to an additional survey by the ASA. This imbalance of cost and revenue place health systems in a financially precarious position—a risk they may not afford to take in today’s rapidly changing landscape.

The Trend of Transition

Despite its critical role in the continuum of hospital care, the anesthesia department is not immune to the trend of change sweeping across the healthcare industry.

According to a recent study by Enhance Healthcare Consulting, nearly half of all hospital administrators surveyed were seeking an alternative to their current anesthesia provider, with 25 percent eventually making the change. 40 percent of those hospital leaders attributed subsidy levels as the reason behind their search for a new provider, with 34 percent citing inadequate service and 26 percent claiming a lack of leadership in their current anesthesia department.

While reimbursements decline and patients assume greater responsibility for their healthcare costs, the provision of effective and efficient service is a high priority for hospital leaders. Poor service or a lack of leadership within the anesthesia department reverberates throughout an organization’s operations, negatively impacting both surgeon and patient satisfaction as well as the hospital’s bottom line.

Improved Outcomes

A strong clinical team with proven leadership and compatible culture has the ability to deliver increased patient satisfaction, reduced OR cancellations, improved efficiency, fewer surgeon and staff complaints, and better clinical outcomes overall. As the anesthesia provider’s role becomes increasingly critical to the financial and operational well-being of a health system and the community it serves, hospital leaders may conduct an in-depth analysis of their existing anesthesia provider and the level of service delivered.

If this quality audit reveals substandard care, inefficient start times or inappropriate subsidy rates, hospital administrators may seek an alternative to their current provider. To ensure a seamless transition, it is important for the incoming anesthesia provider to offer a clear transition strategy and have proven processes in place to smoothly integrate into the organization without disrupting the quality or efficiency of care delivered.

To learn more about the anesthesia landscape and the options available to hospital leaders, please contact us at