In the world of healthcare, Ambulatory Surgery Centers (ASCs) play a crucial role in providing efficient and cost-effective surgical care. However, the importance of regulatory compliance may get overlooked while centers focus on patient care and essential operations. While it may be tempting to dismiss fines as minor inconveniences, non-compliance carries far more than just financial penalties. The hidden costs can significantly affect an ASC’s financial stability, reputation, and long-term success.
In this blog, we will dive into the often unseen monetary consequences of non-compliance, and help ASCs find ways to mitigate costs by implementing solutions that allow efficiency and compliance at the same time.
Fines and Penalties for Non-Compliance
The most obvious cost of non-compliance for ASCs comes from fines and penalties. Regulatory bodies can impose significant fines for violations of laws such as the Medicare and Medicaid Anti-Kickback Statute as well as specific infractions like breaches in patient rights, infection control, or emergency preparedness. These fines can vary in amount but can quickly add up if multiple violations are found.
Beyond fines, these compliance violations could also result in Medicare payment reductions, reimbursement denials, and potential exclusion from federal programs, ultimately preventing an ASC from receiving federal funding altogether.
Legal Fees Associated with Regulatory Lawsuits
Due to the sensitive nature of non-compliance, ASCs that do not fall within the regulatory guidelines may also face legal issues. As you can imagine, the costs associated with defending against lawsuits or regulatory actions can be substantial. Below are just a few examples of how legal fees may be distributed during a lawsuit:
- Legal Defense: When facing a lawsuit from patients, employees, or regulatory bodies, legal defense in these cases can be costly, especially if the case goes to trial.
- Settlements and Judgments: In addition to the cost of the legal team itself, ASCs might have to pay settlements or judgments if they lose a lawsuit.
- Regulatory Investigations: Non-compliance can trigger investigations by regulatory bodies such as the Centers for Medicare & Medicaid Services (CMS) or the Office of Inspector General (OIG), which incur further additional costs.
- Compliance Audits: When ASCs are found to be non-compliant, they may be subject to additional compliance audits, at their own cost.
- Consultation Fees: To avoid future non-compliance, ASCs often hire legal consultants to review and update their policies and procedures. These consultation fees can add up, especially if extensive changes are needed.
Operational Disruptions at ASCs
If, after audits and legal reviews, an ASC is found to be non-compliant, significant operational changes are often needed. For example, the ASC may be required to temporarily close, which can result in lost revenue and additional reopening costs. Other operational expenses include the necessary equipment and facility upgrades to help meet compliance standards.
These closures or operational disruptions also have a trickle-down effect on the staff, as they are required to attend additional training, are presented with recourse, or are temporarily laid off during the closing period. This, in turn, may cause ASCs to face additional costs for hiring and training once the facility reopens.
Additionally, non-compliance can disrupt patient care, leading to rescheduled surgeries or delayed treatments, which negatively impact patient satisfaction. These issues can reduce patient volume and trust, ultimately affecting long-term profitability. Therefore, ASCs must also consider the cost of reputational damage.
Increased Insurance Premiums Related to Non-Compliance
Speaking of reputation, patients are not the only major audience that will notice the impacts of deficiencies. Insurance companies often view non-compliant ASCs as higher-risk entities, resulting in higher premiums for liability, malpractice, and workers’ compensation insurance. For example, if an ASC fails to comply with safety regulations, it may face higher premiums due to the increased risk of accidents or malpractice claims.
These additional costs can be substantial, especially if an ASC has multiple violations or fails to address issues promptly. Overall, maintaining compliance is crucial for keeping insurance premiums manageable and avoiding these hidden costs that can strain an ASC’s financial resources.
How to Reduce Non-Compliance Costs for ASCs
The best way to avoid fees associated with non-compliance is by… staying compliant, of course! But we know that is easier said than done. That’s why Surglogs built a solution to automate and track ASCs compliance in real-time. From policies to daily tasks, our digital platform provides your facility with an up-to-date compliance status for all regulatory bodies.
The best part? The cost of this solution pales in comparison to any one of the significant costs mentioned in this blog. To find out more, schedule a demo today: Request Demo | Surglogs.
