As healthcare continues migrating toward outpatient procedures and value-based models, there are a number of federal policies that ASC leaders and physicians are watching and preparing for.
Five ASC and outpatient leaders recently joined Becker’s to discuss which federal policies they are watching most closely.
Editor’s note: Responses have been lightly edited for clarity and length:
Bruce Feldman. Administrator of Bronx Surgery Center (New York City): The federal policy changes that will have the most impact on ASCs over the next 5 years are:
(1) Increasing the Medicare facility reimbursement rates to be on par with the hospital HOPD rates.
(2) Expanding the list of Medicare ASC-approved surgical procedures.
(3) Mandating that certain procedures will only be covered if performed in an ASC and not in a hospital in order to save costs, increase patient satisfaction and reduce infection rates.
(4) Loosening the restrictions on some of the safe harbor regulations to enable more independent physician-owned ASCs.
(5) Reducing/eliminating the CON restrictions to build new ASCs (state-specific).
Beth Hoy, MSN. Administrator of New Tampa Surgery Center (West Chapel, Fla.): Medicare/CMS reimbursement issues are a significant burden for both ASCs and anesthesia providers. The disparity between Medicare and commercial reimbursement is not only substantial but growing more unsustainable, particularly as the Medicare patient population increases, especially here in Florida, and margins continue to shrink. Medicare reimbursement rates are about $22 per ASA unit, which translates to about $450-500 per average case (e.g., 20-22 units). Whereas commercial reimbursement rates can be four to five times higher, often paying $80-$120 per unit, or around $1,500-$2,000+ per case. This profitability challenge for anesthesia providers forces increased pressure on ASCs to subsidize anesthesia coverage via monthly stipends which are reaching $20k-$100k per month per location.
Couple that with lower Medicare reimbursement per case for the ASCs themselves, and it’s a double whammy! Medicare has bundled payments, and therefore doesn’t pay for implants or high-cost disposables, leaving ASCs operating at a loss or near break-even for many Medicare procedures.
Sarah Malaniak. Administrator of Peakpoint Flatiron Surgery Center (New York City): Over the next five years, ASCs will face several impactful federal policy changes. One of the most immediate is the 2.9% Medicare payment increase for 2025, tied to the hospital market basket index. However, this alignment is only guaranteed through 2025, and future updates may revert to a less favorable formula. Additionally, budget neutrality rules continue to limit ASC payment growth compared to hospital outpatient departments, raising concerns about long-term financial sustainability.
Medicaid policy changes also pose challenges. Proposed federal cuts could reduce access for low-income patients, potentially shifting more volume to ASCs as hospitals scale back services. However, this benefit depends on whether reimbursement remains viable for ASCs to absorb that volume.
CMS is also expanding prior authorization requirements for high-cost procedures such as cardiac, spinal, and orthopedic surgeries. These changes could delay care and impact revenue unless ASCs proactively negotiate streamlined processes with payers. At the same time, CMS is advancing site-neutral payment policies to equalize reimbursement between ASCs and hospitals. While this could benefit ASCs in the long term, it may also increase regulatory scrutiny and competition.
Quality reporting requirements are evolving as well. The ASC Quality Reporting Program will introduce new measures, including the Facility Commitment to Health Equity (mandatory in 2025) and Screening for Social Drivers of Health (voluntary in 2025, mandatory in 2026). Noncompliance could result in a 2% Medicare payment penalty, prompting ASCs to invest in data infrastructure and reporting capabilities.
CMS is also encouraging safer pain management by offering separate payments for certain non-opioid drugs and devices through 2027. Additionally, the agency is preparing to launch a Value-Based Purchasing program for ASCs, which would tie reimbursement to performance on quality and efficiency metrics. Finally, proposed changes to the federal rulemaking process could limit public input on future Medicare and Medicaid policies, potentially reducing transparency and increasing regulatory uncertainty for ASCs.
Robert Nelson, PA-C. Former Executive Director of Island Eye Surgicenter (Westbury, N.Y.): In the 2026 Medicare ASC proposed rule, CMS is expected to determine how, going forward, annual cost-of-living updates will be calculated. For the first two decades-plus of the Medicare ASC program, ASC rates were increased by the [Consumer Price Index for All Urban Consumers], while hospital outpatient departments were reimbursed by the Hospital Market Basket which has typically been about a percentage point higher. For years, the ASC community fought for the policy that ASC payment rates should receive the same adjustment as HOPDs. ASCs treat virtually the same patients, use the same resources, incur the same costs and adhere to the same regulatory standards as hospitals. Moreover, different inflators exacerbated the gap in payment rates to surgery centers and hospitals. Six years ago, as part of a trial demonstration, CMS decided to experiment with paying ASCs at the market basket methodology.
CMS is expected to make a permanent policy regarding the ASC update and has options:
A) Maintaining the current alignment of updates to ASCs and hospitals, which the ASC community fully supports
B) Utilizing another update factor, e.g. the Medical Economic Index
C) Establishing a new ASC-specific update factor. The industry awaits this decision.
Teresa Tam, MD. Minimally Invasive Gynecological Surgeon and Owner of All for Women Healthcare (Chicago): I believe federal policy changes will significantly impact ASCs with the shift towards value-based care models. ASCs will need to prioritize patient outcomes and cost efficiency. This could mean getting involved in bundled payment programs and enhancing how they track quality and outcomes. Changes in Medicare reimbursement rates and policies, including the potential expansion of covered procedures, could influence the financial landscape for ASCs. While ASCs traditionally operate under a fee-for-service model, the healthcare industry is increasingly moving towards value-based care. Staying informed about these changes will be crucial for effective planning. ASCs may need to consider how they can adapt to or integrate value-based care principles to remain competitive and financially stable. Additionally, CMS may introduce stricter quality reporting requirements, so compliance will be essential to avoid penalties and demonstrate the value of care. Any updates to federal regulations regarding healthcare operations, such as safety protocols, will require ASCs to adjust their operations accordingly.
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