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Should you have an anesthesia subsidy?


More than 85% of hospitals pay a subsidy (either directly or indirectly) for their anesthesia services. The subsidy is necessary because of several reasons, but here are three contributing factors that usually play a role in the subsidy requirement or the subsidy increasing:

  • Third-party reimbursement for anesthesia service is insufficient to cover the cost of the service and, in today's reimbursement climate, it's unlikely that we will see any movement from third-party payers to address this issue.

  • Most anesthesia practices have not built the necessary management infrastructure of tools, technology, and processes to effectively and efficiently manage a practice that is facing so many internal and external challenges.

  • Low provider productivity is a significant contributor to high subsidies: Anesthesia providers are some of the most highly compensated healthcare providers in the industry today. Yet, it's not uncommon for providers to be only 45 to 55 percent productive. Acuity based staffing and flexible manpower deployment can increase provider productivity and lower your subsidy.

The real question you should be asking is, "Am I paying the RIGHT subsidy?" Most often, the answer is no. Premier Anesthesia has performed a number of consulting engagements with hospitals to evaluate subsidies and we've discovered the typical hospital can reduce its subsidy by 10-25% without negatively impacting patient care outcomes, while still providing surgeons with room access and availability to meet their surgical case volume on a timely and efficient basis.

For a free initial consultation or more information, reach out to Premier Anesthesia or call 855-220-3662.


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