A March 14 MedPAC report found that while certificate-of-need laws are a major factor in ASC development, other state-specific factors, such as healthcare payment models and demographics, can blunt their effects.
Here are five things to know certificate-of-need laws and ASCs, according to the report:
1. More states are moving to change their certificate-of-need laws. South Carolina eliminated its certificate-of-need requirements for ASCs in 2023, and North Carolina removed the requirement for ASCs in counties with populations greater than 125,000.
2. Whether a state has a certificate-of-need law appears to be a strong factor influencing the number of ASCs per Medicare Part B beneficiary. However, the effect of these laws varies depending on their stringency.
3. Nevada, for example, maintains a relatively weak certificate-of-need law for ASCs and has one of the highest concentrations of ASCs per beneficiary. In contrast, Vermont has some of the strictest certificate-of-need laws and the lowest ASC density in the country.
4. Certificate-of-need laws are not the sole determinant of ASC prevalence. Maryland offers a notable example: Despite having a strong certificate-of-need law, it has the highest number of ASCs per Medicare beneficiary. This anomaly is likely due to Maryland’s all-payer global budget model, which excludes care provided by ASCs and incentivizes hospitals to shift outpatient procedures to surgery centers to stay within budget, the report said.
5. Conversely, New Mexico, which does not have a certificate-of-need law for ASCs, has a relatively low number of centers — about half the national average per 100,000 Part B beneficiaries — likely due to the state’s large rural population and geographic dispersion.
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