building the case for integrating the surgical services suite l md buyline

Building the Case For Integrating the Surgical Services SuiteJames Laskaris, EE, BMETom Watson, BS, RCVTLoretta Loncoske, BS, R.T. (R)

– Joined MD Buyline in 1986– 35 years in the fields of cardiology and

healthcare– Previously served as the Administrative

and Technical Director of Cardiology

Department, West Jefferson Medical

Center, New Orleans, LA– Registered in Noninvasive and Invasive

Cardiovascular Modalities, National

Society of Cardiovascular Technologies

– Joined MD Buyline in 1994– Over 30 years in the healthcare field– Previously served as Clinical

Engineering Department Director,

Service Master, Central, WI– Primary analyst of high end OR

technology– Covers legislative and reimbursement

impact on healthcare

Tom Watson, BS, RCVTSenior Clinical Analyst,

MD Buyline

James Laskaris, EE, BMESenior Emerging Technology Analyst,

MD Buyline

Presenters

– Joined MD Buyline in 1991– Over 30 years in the radiology field– Previously served as the Director of

Radiology, Florida Keys Memorial

Hospital– Member of ARRT and ASRT– Member of HIMSS and SMM

Loretta Loncoske, BS, R.T. (R) Senior Clinical Analyst,

MD Buyline

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The Changing Healthcare Landscape

• HITECH Act is modernizing delivery of healthcare by

improving efficiencies with IT solutions

– Estimated to save ~$200 billion over the next 10 years

• Integrated surgical services includes integrated OR, interventional

hybrid OR and intraoperative iMRI/iCT

– Adoption is complicated by high cost and lack of direct ROI

– Integrated surgical services can lower costs in indirect ways

Reducing length of stay

Improving outcomes

Offering shorter recover time

– Controlling costs and improving quality of care are a major focus in healthcare

4

Agenda

• Review the following for integrated ORs, hybrid ORs and

intraoperative iMRI/iCT

– The Market

– Technology and Costs

– Vendors

– Clinical Outcomes

– Financial Considerations and Reimbursement

– Takeaways

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Integrated OR: Introduction

• Integrated operating rooms (ORs) offer improved surgical experience

through the incorporation of multiple components

• Clinical studies have found integrated ORs decrease OR time and

improve outcomes

• Most direct costs in OR are fixed; labor is the best target to reduce

costs by:

– More efficient use of OR staff

– Increased patient volume

– Optimizing procedure time

• Time becomes the most important factor in offsetting costs

Do you currently have or are you thinking of investing in integrated OR?

• Yes, we currently have one

• We are considering one

• No

• Don’t know

Poll Question

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Integrated OR: The Market

• ~37,000 ORs in the U.S. are performing 51.4 million inpatient surgical

procedures

• 20% of ORs have some form of integrated technology

• Integrated ORs are not applicable to all surgical settings and should be

targeted at high volume, high impact settings:

– Arteriography and angiocardiography (contrast material): 2.4 million

– Cardiac catheterizations: 1.0 million

– Endoscopy of small intestine with or without biopsy: 1.1 million

– Endoscopy of large intestine with or without biopsy: 499,000

– Balloon angioplasty of coronary artery/coronary atherectomy: 500,000

– Reduction of fracture: 671,000

– Insertion of coronary artery stent: 454,000

– Coronary artery bypass graft: 395,000

– Total knee and hip replacement: 1 million

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Integrated OR: Technology and Costs

• Integrated ORs are custom designed for provider’s needs

– Typically utilize several different vendors' products for a functional system

Large variation in pricing

• Typical modules/functional features of an integrated OR systems

include:

Basic Automated Systems Telemedicine Real-Time Information

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Integrated OR: Automation

• Automation allows surgeons greater

control of their environment by

linking individual pieces to a central

device

• Benefits of automation:

– Relieves strain on surgeons and staff from lengthy cases

– Surgical suite can be instantly configured

Avoid delays from reconfiguring equipment

More efficient use of nursing staff

Room wait time reduced by 10 minutes

Surgical time reduced by 15 minutes

• Cost* ranges from $20,000 to $50,000

– Upgrading individual pieces of equipment: $1,500 to $2,000 per device

*Source = MD Buyline

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Integrated OR: Telemedicine

• Telemedicine allows the transfer of medical

information for diagnosis, therapy and

education between medical professionals

located remotely

• Benefits of Telemedicine:

– Easier for hospitals to incorporate new

procedures

– Removes the need for surgeons and staff

to leave practices to learn new techniques offsite

• Cost* ranges from $30,000 to $400,000 per room

– Pricing variation due to:

Inclusion of two-way communication

If system is closed to the facility or broadcasted


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Integrated OR: Real Time Information Packages

• Real time information packages allow for integration of high level

information into OR

• Benefits of Real time information:

– Access to PACS images, EHRs and lab reports

– Consultations between surgeons, radiologists, or pathologists without requiring

physical presence in the surgical suite

– Visual record of the surgery

• Cost* ranges from $20,000 to $500,000

per room

– Higher pricing is related to incorporation of

two-way communication


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Integrated OR: Vendor 1

• Option A

– IP conferencing platform utilizes hospital's network infrastructure to facilitate video-

conferencing and broadcasting from within the OR

• Option B

– HD digital video routing system, supports all video standards and resolutions

– System features: integrated surgical checklist, customizable room presets and centralized

OR equipment controls

• Option C

– Provides centralized storage for archiving and management of surgical videos and images

– Integration with hospital EMR allows direct access to surgical videos/images from patient

charts

Automation Cost* Telemedicine Cost* Real Time Information Cost*

$65,000 - $85,000 $100,000 - $180,000 $250,000+


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Integrated OR: Vendors 2

• Option A

– Provides video routing for up to three destinations, designed for a single OR

• Option B

– Open architecture system designed to route video to up to 8 locations

– Systems include touch panel control, video preview and 8 inputs


$54,000 - $95,000 $110,000 - $185,000 $200,000+


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Integrated OR: Vendors 3

• Option A

– Configured with HD video conferencing and HD streaming, multi-view windowing,

HD image capturing, HD video recording and hands-free VoIP communication


N/A $95,000 - $220,000 $220,000+


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• Option A

– Includes control of the scope surgical system, light source, insufflator, monitor,

image management, documentation system and OR environment

– Configuration includes audio/video visual capabilities (OR light cameras and

microphones), EHR, telemedicine and PACS interfacing

• Option B

– Offers control over all audio-visual components (routers, cameras, graphics

processors, flat panel displays, audio and video conferencing, etc.)


$50,000 - $85,000 $120,000 - $180,000 $200,000+


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• Option A

– Allows importation of EMR and PACS images in real time and control of endoscopic

towers and the OR environment


$20,000 - $65,000 $110,000 - $190,000 $200,000+


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• Option A

– Configured to control all OR technology and environment functions

• Option B

– Designed to control video and data from EHR, PACS and endoscope and C-arm

images


$65,000 - $95,000 $180,000 - $220,000 $200,000+


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Integrated OR: Clinical Outcomes

• Integrated ORs improve efficiencies:

– Reduced number of unscheduled procedures from 25% to 14%

– Overtime events decreased from 28% to 21%

– Average savings of 78 minutes per case

– Frequency of “never-events” (foreign objects left inside the body or “wrong-site"

surgery) were cut by nearly half

– Increased precision

– Improved patient outcomes for neuro monitoring

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Integrated OR: Financial Considerations and Reimbursement

• Lack of direct reimbursement

– CMS supports telemedicine for diagnostic and consult services

– No reimbursement for OR consults

• Opportunities for cost savings include:

– Increasing volume

– Decreasing time required for procedures

• Automating ORs saves:

– 5-18 minutes for minimally invasive orthopedic procedures

– An additional 30+ minutes for more reconstructive procedures

– 3-4 minutes of set up time for each case

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Mid-level procedure savings:

• $90 per case

• $49,500 per year*

High level procedure savings:

• $170 per patient

• $46,750 per year*

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• Integrating an OR is difficult to sell on "Return on Investment" alone

• Automating several ORs in medium to large hospitals is financially viable

– Supported by CMS reimbursement

– Increase in revenue and profit seen over the term as compared to traditional

counterparts

• Automation technology can be too costly for low volume ORs

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Integrated OR: Takeaways

• For the right facility, integrated OR is an attractive investment

– Provides additional revenue through increasing throughput, shortening procedural

time and improving patient outcomes

– Due to integrated OR’s significant cost, clinical and financial considerations must be

weighed carefully

Pros• Improved outcomes

- More precise surgeries

- Reduction in “never events”

• Improved efficiencies

- Reduced number of unscheduled procedures and overtime

- Higher throughput

Cons• High cost

• No direct reimbursement

• Multiple technology and applications

– Purchasing the right system is challenging

– Multiple vendors working together can make installation difficult

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Hybrid OR: Introduction

• Hybrid ORs combine traditional angiographic imaging technology with

open-surgical capabilities

• Clinical applications include:

– Cardiovascular procedures

Interest began with transcatheter aortic valve replacement (TAVR) surgery

– Neurosurgery

– Thoracic surgery

– Endovascular procedures

• Hybrid ORs require significant financial investment and time to customize

– Utilization is key to making hybrid ORs financially attractive

Do you currently have or are you thinking of investing in hybrid OR technology?



• No

• Don’t know

Poll Question

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Hybrid OR: The Market

• Market is increasing steadily

– Larger market trend toward minimally invasive surgical procedures that offer:

Less traumatic surgery

Shorter hospital stays

Quicker recovery times

Improved quality of life for the patient

• Growth is driven by the surgical side of the business

– Systems must comply with all surgical requirements

– TAVR alone does not offer sufficient caseload to maintain a reasonable ROI

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Hybrid OR: Technology

• Extent of integration dependent on:

– Physicians using the room

– Volume

– Mix of procedures

• Four main components of a hybrid OR:

1. Imaging system (floor- or ceiling-mounted)

2. Imaging table/Surgical table option

3. Anesthesia gas lines

4. Surgical lights and booms

• Market focused on single plane solutions

– Growing interest in biplane technology in neurology

USF Health Communications

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Hybrid OR: Imaging Vendor 1

• Option A

– Floor-based mobile unit uses laser guidance to move around the room

– Single room unit with all cables tethered to the ceiling

– Capital Costs*: $1,700,000 to $2,000,000

– Maintenance Costs*: $110,000 to $150,000 per year


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• Option A

– Offered as both floor and ceiling mounted

system

Ceiling systems are more common

– Positions ceiling rails wider to allow:

Improved air flow

Reduced chance of contaminants in the

surgical field

– Capital Cost*: $1,100,000 to $1,400,000

– Maintenance Cost*: $70,000 to $90,000

per year


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• Option A

– Ceiling-mounted positioner

– Capital Cost*: $1,000,000 to $1,200,000

– Maintenance Costs*: $75,000 to $95,000

per year

• Option B

– Floor-mounted positioner utilizing robotic arm

design technology to allow positioning of

floor mount away from table

– Capital Cost*: $1,400,000 to $1,900,000

– Maintenance Costs*: $100,000 to $125,000

per year*Source = MD Buyline

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• Option A

– Offered as both floor- or ceiling-mounted

Most configurations are floor-mounted

– Capital Costs*: $1,000,000 to $1,400,000

– Maintenance Costs*: $70,000 to $90,000 per year


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Hybrid OR: Table Options

• Application will influence table design

– Traditional surgical table designs are the most common

• Two main vendors provide surgical table solutions

– Tables are certify with imaging systems’ anti-collision software for patient and

equipment safety

– Imaging vendors may require purchase of interface option

– Installation, training and support are the OEM vendors responsibility

– Cost of surgical table options: $200,000 - $250,000*


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Hybrid OR: Table Vendor 1

• Full hybrid OR table-top

– Motor-driven movement simulate free-floating panning capability of traditional

imaging tables

• Capital Cost*: $225,000 to $300,000

• Maintenance Cost*: $8,000 to $15,000 per year

– Most facilities will maintain tables with in-house biomed support


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Hybrid OR: Table Vendor 2

• Two options

1. Motorized imaging table-top for interventional work

2. Traditional surgical table with flexible surgical breakdown features necessary for

a variety of surgical procedures

• Capital Cost*: $150,000 to $225,000

• Maintenance Cost*: $10,000 to $15,000 per year

– Most facilities will maintain tables with in-house biomed support


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Hybrid OR: Anesthesia Lines and Surgical Lights and Booms

• 3rd component of equipment planning – location of medical gas lines for

anesthesia

• 4th component of equipment planning – strategic planning of surgical lights

and booms

– Imaging vendors partner with major surgical light vendors

Providers should work through primary imaging vendor for lights/booms

Imaging vendor should take point on coordinating all vendors involved


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Hybrid OR: Clinical Challenges

• Areas Requiring Focus for Planning, Selection and Implementation

– Key Stakeholders: Interventional Cardiac, Interventional Vascular, Interventional

Neurology, Cardio-thoracic Surgery, Vascular Surgery or Neuro-Surgery

– Budget: Any budgetary constraints that might eliminate vendors or models or

configurations

– Projected Volume: Mix of patient procedures to maximize investment and provide optimal

Return on Investment

– Primary Focus: Interventional with surgical capabilities, or surgical focus with

interventional capabilities

– Gantry Orientation: Ceiling mounted, floor mounted or specialty design

– Table Requirements: This may come from the Key Stakeholders (Imaging Primary or

Surgical Primary)

– Table Vendor: Confirm validation with the imaging vendor of preference

– Surgical Lighting Vendor: Early identification is needed to ensure best outcomes from the

final integrated design of imaging, table and lighting


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Hybrid OR: Financial Considerations and Reimbursement

Scenario 1: TAVR

• Based on 80 patients per year

• Loss of ~$2.95 million over 5 years

Scenario 2: Increased applications

• Based on using OR once a day

• Loss of $2.95 million drops to loss of

$892,000 over 5 years

Scenario 3: Increased utilization rate

• Profit of $252,000 over 5 years


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Hybrid OR: Takeaways

• Utilization and flexibility of the hybrid OR is paramount for maximizing

investment

– Versatility of the room for most facilities will be critical to success

– As minimally invasive procedures grow, so will the interest in hybrid OR

solutions Pros

• Consolidation of surgical and therapeutic approach

• Improved efficiency

• Provide leading edge interventional/surgical solutions

• For providers with high utilization rates and versatility, this can be a revenue generating technology

Cons• Challenging technology integration

• High cost for a multi-functional room

• No specific reimbursement

• Challenging medical specialty team approach (interventional/surgical/ anesthesia)

• May require cross department coordination

• Operational and supply management costs may be difficult to manage & track

• No single vendor solutions

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iMRI: Introduction and Market

• Market growth is slow, driven primarily by neurosurgery applications

• iMRI offers improved clinical results:

– Improves tumor resection

– Reduces need for repeat surgeries

– Improves surgical safety

– Decreases patient length of stay

• iMRI costly, requiring:

– Specialized OR suites and instrumentation

– Longer anesthesia and OR times

– Significant time and personnel investment

Do you currently have or are you thinking of investing in iMRI?



• No

• Don’t know

Poll Question

39

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iMRI: Technology

• Magnetic field strength: 1.2T, 1.5T and 3.0T

• Configuration: Stationary/fixed or mobile

– Fixed configuration: Patients transported to separate MRI room

All OR instruments/technology must be MRI compatible

– Mobile configuration: Magnet swings in and out of the surgical suite, patient remains

stationary

• Coupled with image-guided surgery systems for improved outcomes

• Other considerations:

– Planning time and physician agreement

– Integration of iMRI with equipment inside and outside the department

– Construction and installation

– Training

– Service costs

41

iMRI: Fixed Vendors

• Configuration1:

– MRI integrated into surgical navigation system

– Dual-room approach, sliding RF door allows rooms

to be used individually

– Cost : $4,500,000 to $6,500,000

• Configuration 2

– 1.5T or 3.0T MRI

– Dual room approach, OR room and MRI suite

– Pricing magnetic field strength dependent:

1.5T- $7,500,750

3.0T -$9,960,500

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iMRI: Fixed Vendors

• Configuration 3:

– 1.2T magnetic field strength, open design for 360-degree

view of patient

– Wide patient table with a high weight limit

– Cost: $4,500,000

• Configuration 4:

– Low field 0.6T magnetic field strength

– Designed so only patients are in the magnetic field

– Cost: $2,500,000

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iMRI: Mobile Vendors

• Configuration 1

– Ceiling mounted 1.5T or 3.0T magnet

– MRI compatible OR table

– Three possible room configurations available

– Pricing magnetic field strength dependent:

1.5T- $12,900,500

3.0T - $15,500,750

• Configuration 2

– 0.15 T magnet that can be retrofitted into existing ORs

– Two RF shielding options available:

Complete room shielding

Portable shield

– Cost: $1,700,600 (includes Portable RF Shielding)

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iMRI: Clinical Outcomes

• Outcomes in neuro applications:

– Reduces the risk of damage to the brain

– Improves tumor resection and survival rates

– Confirms total tumor removal during surgery:

Decreases the need for repeat surgeries from 20.5% to 2.2%

Decreases patient length of stay and possibility of complications

Removes need for post-operative MRI

– Account for brain shift that occurs after removal of skull bone

Studies have found brain shift can vary

between 3 and 24 mm which changes

brain architecture significantly

University of Stuttgart

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iMRI: Financial Considerations and Reimbursement

• Technology cost:

– iMRI with Image Guided Surgery (IGS): $2.5 million to $15 million

– IGS only: $500,000

– Service costs significantly increased with iMRI

• Other considerations

– Increased total anesthesia time, increased OR time and cost

– No difference in reimbursement for iMRI

• Financial investment of iMRI requires providers have

– High patient volumes

– Ability to expand iMRI use outside of neuro applications

– High population of private pay mix

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iMRI: Takeaways


– More precise surgeries reduce the need for repeat procedures

– Better safety outcomes

• Use of non-ionizing radiation

– Useful in imaging soft tissues’ structure in organs like the brain, heart and eyes

Cons• High cost

• Limited applications


• Longer OR time

• Small space to work in

• Complexity involved in technology selection and planning

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iCT: Introduction and Market

• Steady growth in intraoperative CT (iCT)

– Increased interest over the last six months

• Clinical applications for iCT:

– Cranial

– Spinal

– ENT

• Coupled with IGS to provide real-time, interactive CT for surgical cases

• Clinical studies support improved outcomes and safety

• High cost has limited adoption

– Head & Neck

– CMF

– Orthopedic

– Vascular Surgery

Of the two technologies, iMRI and iCT, which are you considering investing in?

• iMRI

• iCT

• Both

• Neither one

• Don’t know

Poll Question

48

49

iCT: Technology

• Configuration: Fixed and mobile CT scanners

– Mobile iCT is moved throughout facility for any intraoperative procedure

– Fixed or stationary iCT is in installed within the actual OR room

Used in conjunction with cardiac cath system and radiation oncology

• Coupled with image-guided surgery (IGS) to provide real-time, interactive

CT

• Construction and installation is simpler as compared to iMRI

50

iCT: Vendors

• Vendor 1:

– Received FDA clearance October 2014

– Mobile 64 mobile CT scanner

– Pricing will be set in Q1/Q2 of 2014

• Vendor 2:

– 20 to 64 slice count CT scanner on floor rails

– Designed for cardiac cath and radiation oncology applications

– Cost: . $1,000,000 - $1,200,000

• Vendor 3:

– Received FDA clearance September 2013

– Mobile 32 slice whole body CT scanner

– Offer multiple tabletops for neruo and spinal applications

– Cost: $1,000,000 - $1,225,500.

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iCT: Vendors

• Vendor 4:

– Three portable CT products:

Option 1: 32-slice whole body, $900,000 - $1,100,000

Option 2: 8-slice, battery-operated for head and neck,

$400,000 - $750,000

Option 3: Used for imaging head and neck up to C5,

$350,000 - $450,000

• Vendor 6

– Fixed upright CT

– Applications include sinuses, skull and temporal bones at point of care

– Cost: $260,000 - $350,000

• Vendor 5

– Imaging system similar to mobile C-arm, targeted for

spinal fusion, cranial and orthopedic cases

– Cost: $1,000,000 - $1,500,000 (navigation system) or

$650,000 - $800,000 (without navigation system)

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iCT: Clinical Outcomes

• Clinical outcomes:

– Improves intracranial and spinal tumors resection

– Accounts for brain shift that occurs after skull bone removal

– Improved efficacy for spinal surgery

Check position of the implants used

Determine extent of decompression

Check realignment during surgery

– Improved efficacy for vascular neurosurgery

Ability to image blood vessels

Provides rapid information related to critical impairment of brain perfusion

Eur Spine J. 2005 Sep;14(7):671-6. Epub 2005 Mar 1

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iCT: Financial Considerations and Reimbursement

• Lack of direct ROI and limited financial incentive

– No difference in reimbursement through CMS for iCT

CMS may change reimbursement in the future as iCT adoption increases

– Technology cost is significant

Investment in iCT is considerably less costly than iMRI

• Substantial clinical improvements and diverse applications

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iCT: Takeaways


– More precise surgeries reduces the need for repeat procedures

– Improved confidence for post-operative care

– Immediate recognition of intraoperative hemorrhage

• Diverse number of clinical applications

Cons• High cost

– iCT costs less than iMRI


• Challenging Cross-Team/Department Coordination

• Use of ionizing radiation

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Conclusion

• Integrated OR, hybrid OR and iMRI/iCT have the potential to control costs

and improve the quality of care delivered

• Require substantial investment that must be set against clinical and

financial impacts

• Maximizing investments and realizing optimal results require:

– Coordinated team-based approach to planning, evaluation, selection and

execution

– Close management of key players

– Coordination to avoid both over- or under-buying

Q&A

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building the case for integrating the surgical services suite l md buyline

Healthcare

hybrid ors

md buyline presenters

md buyline james laskaris

direct costs

surgical settings

healthcare field

rcvt senior clinical

r senior clinical analyst