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You can’t afford NOT to have a General Surgery Program

According to the AHA, there are over 6100 hospitals in the United States – of which approximately 1840 are designated as rural / critical access hospitals (CAH) that offer essential access to emergency services, inpatient, and outpatient care throughout the US.  Unfortunately, the financial struggles of these facilities have been well documented as year after year multiple facilities close.  Specifically, over the last decade, 95 rural hospitals closed – with 32 being CAH.

During the 2020 NHRA’s National Policy Institute Conference, The Chartis Group presented that 47% of rural hospitals were operating at a financial loss.  Wow – that’s nearly half of front-line healthcare centers in America teetering on having to close their doors or make other difficult decisions.   A closer look at their data reveals that they identified 9 factors that are causally linked to the financial stability of these hospital.  Of these, four (case mix index, occupancy %, outpatient revenue %, and change total revenue %) are related to the presence or lack thereof of a surgery service line in the hospital. 

Rural hospitals have mission statements that clearly state their commitment to providing quality healthcare to their community – yet far too often, these healthcare facilities are resigned to only provide inpatient care, laboratory/radiographic studies, and ED services  – even though the facility is equipped with surgical suites, staffed with OR personnel, and have credentialed anesthesia providers on staff.  These hospitals unfortunately become the healthcare facility for only Medicare, underinsured, and uninsured populations as the commercially insured patients choose to receive their medical care outside of the community in which the live.  Without the professional fees and facility reimbursements from revenue generating service lines, these hospitals often become relegated to “glorified nursing homes” – which falls far below their mission statement, plant capabilities and community expectations. 

Hospital executives spend endless hours and attend national conferences seeking to address these questions and financial concerns.   Case studies have demonstrated the numerous avenues by which rural hospitals lose revenue – specifically the transfer of patients and the lack of specialty service lines.  The inability of the rural hospitals to treat “facility appropriate” patients has undoubtably contributed to the above listed closure rate and current financial status of the 47% of hospitals currently operating at a deficit.  Key stakeholders within the rural facility understand the Chartis Group report is accurate – but the cost of a surgery program serves as a real impediment to the hospital taking the steps necessary to become financially stable.  The cost of adding a surgery program – even with the overwhelming data supporting it – often leads many facilities to decide, “we just can’t afford a general surgery program!”

Below in Figure #1 is a snapshot of a CAH that recently explored adding a general surgery program to their core service line.  The hospital was faced with significant financial difficulties and predicted long-term budget shortfalls.  They were aware of the high number of transfers from the ED as well as the decreasing admission rate to the ward but the loss of this significant reimbursement for these facility appropriate “bread and butter” general surgery cases was staggering, unexpected, and unnecessary.  This rural facility was built to provide surgical care to its citizens – and was staffed with OR personnel, anesthesia providers (OB services), and appropriate clinic space – yet building a general surgery program was thought to be cost prohibitive.  (This chart shows only the potential revenue lost from CMS patients and does not include potential loss of commercial insurance and other payor sources.)

Figure 1

Critical Access Hospital
Primary Care Providers6
Facility Medicare Case Loss430
Facility Medicare Financial Loss$1.85M
Reg. Facility Medicare Case Loss2,900
Reg. Facility Medicare Financial Loss$9.6M
# of Lost CasesLost Medicare $
Hernia Repair26$256K
Totals:392$1.43 Million

The data listed above provided to hospital leadership as clear and substantial proof that a general surgery program would not only help fulfill their mission statement but financially would create a significant revenue stream that would strengthen the financial bottom line of the hospital.   For rural hospitals, the potential expense of starting a surgery program could be daunting.  One mistake could have a deleterious effect on the stability of the entire hospital.   Capital cost, surgeon recruitment and retention, and program development are legitimate concerns that require careful deliberation but not a reason to not move forward.

Over the last decade, the rural surgicalist model has evolved into a new approach of helping rural facilities add this critically important service line.  Currently, there are industry leaders building full-time and custom part-time general turnkey surgery program that addresses the clinical needs of the rural community and the financial concerns of the hospital.  The rural surgicalist program can virtually eliminate the concern of long-term contracts, unproductive surgeons, and unrecoverable expenses – while developing a high quality, long term, revenue generating service line for your facility.

If you are one of the 47% of rural facilities discussed above and looking for a proven solution to address your hospital financial revenue – contact an industry leader in rural surgery and let them show you why “You can’t afford NOT to have a general surgery program.”

G McClain, MD

rural surgeons

Rural Hospitals Have REAL Surgical Emergencies

The Case

I was in the rural surgery clinic seeing patients when the ED physician called the general surgery phone frantic that a 6-month-old child is choking in the ED.  The mother can be heard screaming in the background “please don’t let me baby die.”   The ED physician states the baby swallowed a watch battery, and  I immediately leave the clinic, called the OR and requested the GI team meet me in the ED. 

Upon arriving in ED, I evaluated the child, reviewed the images and quickly discussed the options with the ED provider, the anesthesia provider, and EMS.  With the location of the foreign body in the infant’s esophagus, it would have not been safe to transport him to another facility with a pediatric provider. 

In the ED, after consent was obtained, I performed an emergent EGD and removed the foreign body.  The entire procedure took less than 3 minutes. 

x-ray 2

Upon completion of the procedure, I spoke with family and noticed that the entire ED waiting room, hallways, and even the parking lot was completely filled with concerned community members – who were relieved that this critical access hospital could fulfill it’s mission statement of providing emergency surgical care to it citizens.

This critical access hospital – situated in a county with a population of 6000 – had decided 3 months prior to start a fulltime surgicalist program.  The program was growing but the community was either not completely aware of the program or unconvinced of our skillset.  Following the reports of this emergent procedure, the outpatient clinic visits increased by 42% in the next 3 weeks.  In addition, the number of commercially insured ER visits increased by 52% over the next month.

The Problem

Rural hospitals have the enormous responsibility of providing high quality emergency care to their citizens.  With decreasing reimbursements and difficulty developing / maintaining specialty service lines, these rural facilities have the difficult responsibility of trying to fulfill mission statement to their community.  In particular, the ability to maintain a full-time general surgery program is a daunting task.  The shortage of general surgeons is well documented throughout the United States – but the shortage of these specialist in the rural community is more than a press release – it is an unfortunate reality. 

According to an April 2019 report by the AAMC, there is a critical shortage of general surgeons that is only expected to increase over the next decade.  By 2032, the shortage of general surgeons is expected to exceed 23,000.  As the number of the classic rural general surgeon continues to decrease with retirement and burnout along the increasing trend of >90% of all graduates seeking specialty fellowship training, the pool of general surgeons to provide services to rural communities will continue to decrease. 

According to Merritt, Hawkins & Associates, the overall cost (including lost revenue) of recruiting a general surgeon exceeds 1.5 million annually.   This cost includes salaries, recruitment fees, interviewing, relocation, practice marketing, and lost revenue (while searching for the surgeon).

The recruitment and retention of general surgeons is often the limiting factor in not only building a successful general surgery program – but maintaining it.  The need for a highly skilled surgeon often leads facilities to offer lucrative, multi-year contracts in the hope that the right surgeon is selected.  Whether it is time commitment, burn out or family pressure, often the grand opening of the surgery clinic is quickly replaced with a new general surgeon search.  In addition to the lost revenue and possible protracted legal battle of an unexpected surgeon departure, the new devices, materials, and community disappointment add to the significant financial burden the facility is faced with.

Unfortunately, many rural facilities are forced to explore short-term fixes to this long-term dilemma.  Locums tenens and other temporary solutions fail to provide the facility or community with the continuity of care required to develop long term trust – and the unsustainable cycle continues.

The Solution

For rural and critical access hospitals, the daunting task of building a successful surgery program is well documented.  Over the last decade, the “surgicalist” has become a possible solution to address these concerns.  Unlike their urban center counterparts, these rural surgicalist are responsible for both inpatient and outpatient surgical care – which allows the facility to address emergency surgery care and build a robust elective practice – which in turn increases the facility’s market share of commercially insured patients. 

Currently, there are industry leaders building full-time and custom part-time general turnkey surgery program that addresses the clinical needs of your community and the financial concerns of the hospital. 

These programs virtually eliminate the concern of long-term contracts, unproductive surgeons, and unrecoverable expenses.  The companies that offer these services recruits highly skilled, board certified general surgeons that are dedicated to bringing gold standard surgical care to rural communities.

But be careful – in choosing to partner with a surgicalist company, each facility must ensure that the company is committed to working collaboratively with your key stakeholders to build the key elements of a complete surgery program – including the outpatient clinic.   They must understand that with the development and expansion of the elective practice – your facility will increase its market share of commercially insured patients – therefore increasing your facility’s bottom line.  Finally, the firm must comprehend that targeted marketing and outreach will make your general surgery program a desired surgery location for not only your local community but regionally.  If any of these are missing, keep searching.

The principles for building a successful Rural Surgicalist program are the following:

  • An administration that recognizes the NEED for a surgery program
  • A community and primary care providers that WANTS a surgery program

If you answer YES to #1 & #2, a rural surgicalist program may be the answer to your surgery problem. 

G McClain, MD