Measuring your ASC’s performance is crucial in order to maintain the health of both your business and your patients. Tracking and assessing financial benchmarks can ultimately provide greater oversight and control over your ASC’s clinical and financial performance and help you identify potential areas for improvement.
With that said, knowing which ambulatory surgery center metrics to monitor, analyze, and compare with industry averages is the key to increasing the profitability and effectiveness of your business. In this article, we’ll provide a benchmarking analysis overview with ROI ratios to keep track of to accurately assess and maximize your ASC’s performance.
Tracking your ASC’s key performance indicators (KPIs) over time and comparing internal metrics against industry benchmarks plays an essential role in assessing the financial health of your center. Doing so helps paint a more comprehensive, holistic picture of where you’re excelling and where you can improve in comparison to similar facilities.
There are several resources available for accessing external benchmarks, such as the Ambulatory Surgery Center Association (ASCA) Clinical and Operating Benchmarking Survey and Accreditation Association for Ambulatory Health Care (AAAHC) benchmarking studies. Now, let’s cover what to include in your ASC’s benchmarking analysis.
It starts with measuring your center’s profitability ratios, which measure the combined results of your operations. Metrics for this section include:
Next, you’ll take a look at your asset management and activity ratios, which measure how effectively your ASC’s assets are managed and utilized. For this step, you’ll want to track:
Up next are debt management ratios, which measure your ASC’s use of debt and leverage. To figure out yours, measure the following:
Liquidity ratios measure a center’s ability to meet its current obligations. To determine your liquidity ratios, measure your short-term solvency. Then, measure it again excluding inventory from the calculation. Industry annual averages come in just under two.
Lastly is A/R aging, which essentially breaks down unpaid invoice balances by the duration for which they've been outstanding. Ideally, the highest percentage of unpaid invoices falls in the 0-30 day range; however, keep in mind that percent per aging categories are industry averages and not best practices.
Annual averages for A/R aging are:
By measuring your ASC’s effectiveness, you can identify areas for improvement, gain better control over your revenue cycle performance, and offer top-quality care for the patients you see in your facility.
Overwhelmed by benchmarking analysis, revenue cycle management, and other financial business performance essentials? ASCs benefit from outsourcing revenue cycle management in a number of ways. Schedule a free consultation to learn more about Amblitel’s expert revenue cycle management guidance and support.