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ASC Market Brief: Policy, People, and the Path to 2026
73 Plays21 days ago
As Q3 wraps, this episode spotlights the signals that matter for ASC leaders heading into the busiest quarter of the year. We track policy direction, the continued shift of cases to outpatient settings, and how employer data transparency is accelerating site-of-care redirection. We scan market momentum and partnerships, revisit anesthesia coverage and how centers are adapting, and share pragmatic AI wins that tighten schedules and improve RCM. Skim the quarter’s major ASC trends in under 20 minutes to guide Q4 execution and set up 2026 planning.
Resources mentioned:
CMS proposed CY-2026 OPPS/ASC rule
National Alliance of Healthcare Purchaser Coalitions Pulse of the Purchaser 2025 Survey
Tenet Reports Strong Second Quarter 2025 Results; Raises 2025 Financial Outlook
Ascension nears $3.9B AmSurg acquisition: Bloomberg
Avanza Strategies 6th Hospital Leadership ASC Survey
Becker’s ASC Annual Meeting, October 16–18, Chicago
Brought to you by HST Pathways.
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Transcript
Introduction and Episode Format
00:00:00
Speaker
Welcome to This Week in Surgery Centers. If you're in the ASC industry, then you're in the right place. Every week, we'll start the episode off by sharing an interesting conversation we had with our featured guest, and then we'll close the episode by recapping the latest news impacting surgery centers.
00:00:16
Speaker
We're excited to share with you what we have, so let's get started and see what the industry's been up to.
Q4 2026 Planning and Market Trends
00:00:24
Speaker
Hi everyone, and welcome back to This Week in Surgery Centers. It's the last day of Q3, and we're gonna do something a little different today. I'm gonna share with you some of the market trends, the big news and announcements we heard over the summer, and let you in on a couple of things that we're tracking so that you can do the same at your center. We're gonna cover policy updates, market structure, workforce dynamics, and of course, a little note on technology as we gear up for fourth quarter in 2026 planning.
00:00:51
Speaker
What we're not doing today No product talk, no deep policy analysis, just enough signal to inform planning. Two anchor points set the tone.
CMS 2026 Payment System and ICD-10 Code Changes
00:01:01
Speaker
In mid-July, the Centers for Medicare and Medicaid Services released the proposed calendar year 2026 outpatient prospective payment system and ambulatory surgery center payment system rule.
00:01:13
Speaker
It continues the long shift toward outpatient care and previews what a late year final rule will likely look like. And a quick heads up for operations. On October 1st or tomorrow, if you're watching this podcast upon release, the ICD-10-CM codes and guidelines switched to fiscal year 2026. It's a routine turnover and certainly not today's headline, but worth noting because early weeks can bring some preventable denials if teams are not aligned.
Shift to ASCs: Trends and Employer Strategies
00:01:39
Speaker
So let's get into it and talk about the trend of case migration to the outpatient setting. Over the past few years, we've seen a steady shift of procedures into ambulatory surgery centers. And this quarter, that momentum is, of course, being reinforced from two directions, so policy and purchasers.
00:01:55
Speaker
The CMS proposed 2026 update continues to normalize outpatient care, while employers, with better claims transparency, are pushing care to high-value sites.
00:02:05
Speaker
That combination sets the stage for where volume goes next. So first, let's talk about policy. As I mentioned, this summer's proposed 2026 payment update for ASCs is incremental but directionally consistent.
00:02:18
Speaker
Payment policies and the supporting addenda shape which services, ancillaries, and indicators fit well in the ASC setting. The public comment window precedes a late-year final rule that will ultimately govern 2026.
Employer Influence on ASC Utilization
00:02:31
Speaker
Then on September 8th, just a few weeks ago, the National Alliance of Healthcare Purchaser Coalition's released new findings from its Pulse of the Purchaser Survey of over 324 employers.
00:02:43
Speaker
It found that employers with full claims data rights were markedly more likely to use higher value purchasing strategies like site of care redirection and direct contracting than employers without complete data access.
00:02:56
Speaker
The report also highlights persistent pressure from hospital and pharmacy costs, with purchasers leaning on data transparency to counter trends. Here's a quick real-world example.
00:03:08
Speaker
A self-funded employer runs a simple comparison on a routine orthoscope. The all-in episode cost at a hospital outpatient department is higher, while the ASC comes in lower with similar outcomes.
00:03:20
Speaker
When the employer actually has full claims access, their third-party administrator can steer members to the ASC with a benefit design nudge. Maybe a lower copay, simpler scheduling, no fanfare, just a quiet shift in cases.
00:03:36
Speaker
Multiply that by a handful of common procedures and you will start to feel the volume move. Now, none of this is a sudden pivot. It's the next chapter in a multi-year arc.
00:03:47
Speaker
More procedures moving to lower cost, high quality sites, reinforced each year by CMS rulemaking and employers getting smarter with claims data.
CMS Proposal for Cardiac Procedures in ASCs
00:03:56
Speaker
Within that arc, cardiovascular stands out.
00:03:59
Speaker
The 2026 proposed rule from CMS includes adding cardiac catheter ablation to the ASC-covered procedures list, something professional societies have been pushing for, and it also revisits the criteria for what can be added to the list more broadly.
00:04:14
Speaker
We'll know what actually makes the cut when the final rule lands later this year. Meanwhile, summer trade coverage shows a practical shift. more cardiovascular work finding its way to ASCs and office-based labs, and some operators planning hybrid facilities that can flex between settings.
00:04:31
Speaker
If ablation is finalized for ASCs, expect payer policies to follow over time, which is typically what accelerates real specialty and service line build-outs. It's not at all clear for every cardiac procedure, but the direction is favorable.
00:04:45
Speaker
If 2026 policy tracks as proposed, it could open the door wider for heart rhythm cases in the ASC setting. So now let's shift over to the market and what moves we're seeing there.
Hospital Ownership and Joint Ventures in ASCs
00:04:55
Speaker
United Surgical Partners International, or USPI, part of Tenant Healthcare, care reported continued momentum this summer Same-store revenue was up more than 7% in the first half of 2025, helped by integration of around 50 centers acquired last year and a strong development pipeline.
00:05:12
Speaker
Tenet also raised its 2025 outlook in late July, reinforcing the growth thesis in ambulatory surgery. Ascension's agreement to acquire Amsurge adds another major system buyer to the ASC platform landscape.
00:05:27
Speaker
The June announcement cites over 250 centers across 34 states, with reporting pegging the deal value at $3.9 billion. dollars That's a scale move with obvious implication for referrals, contracting leverage, and recruiting in multiple regions.
00:05:44
Speaker
Zooming out, hospital and health system ownership of surgery centers has surged. The latest hospital leadership ASC survey from Avonza Strategies shows 82% of hospitals or health systems owned at least one ASC in 2024, number that's up from 48% 2023 and 41% in 2019.
00:06:04
Speaker
and forty one percent and twenty nineteen Among those that own ASCs, 57% now own two or more, and 90% plan to increase ASC investments or affiliations.
00:06:17
Speaker
Ownership models remain mixed, but the center of gravity is shared control. Around 75% structure their ASCs as joint ventures, and 67% prefer to hold a majority stake.
00:06:29
Speaker
As larger platforms and health systems expand, you feel it close to home. Referral patterns start to shift, payer negotiations get recalibrated, and recruiting dynamics move with them.
00:06:39
Speaker
The hinge is ultimately physician alignment. You can see it in how many operators now emphasize health system partnerships. SCA Health is one example, which tells you that joint venture models are shaping access in a lot of markets.
00:06:53
Speaker
So what might that look like where you are? When a health system takes a majority stake in a joint venture center, employed physicians often get priority access and day-to-day operations tighten up, credentialing, quality reporting, even the software stack.
00:07:06
Speaker
Where a platform like USPI Tenet grows alongside a big system buyer, referral gravity usually follows physician alignment first and payer rates second. And independents still have a clear lane, faster access, predictable block time, and transparent outcomes.
00:07:22
Speaker
In competitive areas, they keep their edge by leaning into subspecialty depth or by centering well-known surgeon experience. Which is a nice segue into our next topic, something that's top of mind for everyone, which is staffing, the issue that's never fully eased, especially in anesthesia.
Challenges in Anesthesia Coverage
00:07:39
Speaker
Over roughly the past decade, anesthesia reimbursement has gone down, while pay for anesthesia professionals has gone up. That squeeze is why it's getting harder in some places to secure steady anesthesia coverage.
00:07:51
Speaker
To keep rooms running, many centers are now using stipends or guarantees in their agreements. It's not anyone's first choice. It's just what the math often requires right now. And at the same time, demand is not falling.
00:08:04
Speaker
We have an aging population, steady surgical volume, and the limits on how fast new anesthesiologists and CRNAs can be trained. Put those together and you'll have a very tight labor market at the very moment revenue pressure is mounting.
00:08:19
Speaker
And that's a tough combination. You can see this tension in everyday operations. As we've discussed on the podcast, ASCs have some different ways to set up coverage. Traditional contracts with anesthesia groups, in-house teams employed by the center or health system, certified registered nurse anesthetist-only models in states that allow it, or a hybrid of all of these approaches.
00:08:43
Speaker
There is a one right model for everyone. Centers have to choose what fits their state rules, case mix, and budget. What these models do have in common though is the goal. Reliable coverage so you can start on time and finish on time.
00:08:58
Speaker
Here's the practical takeaway. For an ASC, the most persuasive thing that you can show an anesthesia provider is time you can count on. First case on time starts prove that you're organized and accurate turnover times prove that your schedule is realistic.
00:09:12
Speaker
When those two things are strong, it's easier to staff rooms, easier to discuss performance terms, and easier to avoid last-minute scrambling that burns money and goodwill. Whether you contract with an outside group or employ clinicians directly, predictable days are what keep people willing to cover your rooms.
00:09:30
Speaker
There's also a policy backdrop worth noting. We've seen payers test new ideas to control costs. Some proposals haven't gone forward, but they remind us that payment rules can change, and anesthesia is often in the spotlight when payers are looking for savings.
00:09:45
Speaker
Even when a proposal is withdrawn, the conversation usually comes back in a different form. So where does that leave ambulatory surgery centers today? Professional payments are under pressure.
00:09:56
Speaker
Compensation for clinicians has climbed. And that gap makes coverage harder to sustain without new terms. The workforce is tight. Demand for anesthesia services is steady, and training pipelines take time to expand. Nothing in the last quarter suggests that these themes are fading.
00:10:12
Speaker
If anything, recent news has underlined the same two points. reimbursement pressure and workforce supply are still the biggest anesthesia challenges. And until both of those change, the centers that do best are the ones that make their days as predictable as possible because predictability is what keeps anesthesia coverage in the building.
AI in ASC Operations
00:10:31
Speaker
On to the topic I know everyone can't get enough of, artificial intelligence. But let's bring down how it's actually helping ASCs today across both the office and the OR. Every ASC leader we talk to is fighting some combination of the same three pressures.
00:10:48
Speaker
Rising costs, a relentless administrative burden, and the constant challenge of a lean team. You're asked to do more with less, and it can feel like you're fighting fires all day, every day.
00:11:00
Speaker
But what if you had a new kind of teammate, one that could handle the tedious, repetitive work without complaint? That's the promise of AI in the ASC space. And now, while major hospital systems are spending millions on headline-grabbing robotics and predictive diagnostics, the AI trend in surgery centers is more measured, more practical, and frankly, more immediately useful.
00:11:21
Speaker
It's not about being a rocket scientist. It's about becoming a smarter, more efficient operator. The fastest gains are not necessarily in the operating room, but in the front office and business office where the little wins add up to a significant competitive advantage.
00:11:36
Speaker
Think about your schedule. It's the engine of your ASC, but it's a fragile one. single late start or a surprise add-on can derail an entire day. AI tools are now acting as co-pilot for your schedule.
00:11:50
Speaker
They analyze historical data from your center, which surgeons run long, which procedures are faster than you might think, and they use that data to create a more realistic and therefore more reliable daily schedule.
00:12:02
Speaker
They can even flag patients who are statistically more likely to no-show, giving your team a chance to fill that slot proactively. The result? Fewer surprises, less wasted time, and a smoother flow for patients and staff.
00:12:16
Speaker
Published in the Journal of the American Medical Association Surgery in a randomized trial of 683 surgical patients, a machine learning model predicted case length more accurately than standard estimates and reduced patient wait times with no increase in turnover time. The author's takeaway was simple.
00:12:34
Speaker
Using machine learning every day to predict case duration can help optimize and tighten your schedule. Let's talk about the business office, the place where AI makes the quickest, clearest difference.
00:12:47
Speaker
A denied claim drains margin and time, so think of AI as a steady extra set of hands for your RCM team. Upfront, it runs eligibility and prior authorization checks and gives you a simple list of what's missing before the patient even arrives. That alone cuts a lot of day-of cancellations and paperwork.
00:13:04
Speaker
On the back end, it reads the operative note to suggest codes, with the human reviewing, of course. Scrubs claims for common errors before they go out, and groups denial by root cause so the right fixes happen fast.
00:13:17
Speaker
The result is straightforward. More first-pass approvals and less time spent chasing dollars after the fact. On the clinical side, AI is all about freeing up your highly skilled staff from the mundane.
00:13:29
Speaker
An ambient documentation tool, for example, can listen in on a patient conversation and draft a quick history and physical or a post-anesthesia note. AI can also help with inventory management, suggesting reorder times based on usage, and even prompting staff to capture implant lot numbers before the patient leaves, making recalls and audits cleaner.
00:13:48
Speaker
And it can even help you with something as simple as updating a preference card, ensuring your team has the right tools every time. So what's the takeaway? For ASCs, AI isn't a silver bullet, and you don't need to be the first to adopt every shiny new tool that comes out in the market. The smart move is to take incremental safe steps.
00:14:06
Speaker
Find a pilot program that addresses a specific pain point, whether it's scheduling chaos or denied claims, and start there. Always keep a human in the loop for anything clinical and make sure any tool that handles PHI offers a business associate agreement. The fastest gains will come from improving your processes, not from a single piece of technology.
00:14:26
Speaker
By using AI as an assistant, you can save time, reduce stress, and elevate your team to the work that truly matters, which is caring for patients.
ASC Growth Signals and Strategic Expansions
00:14:36
Speaker
To wrap things up, taking a step back, the signals from this quarter line up and they point in the same direction toward ASC growth.
00:14:45
Speaker
On the policy front, the proposed 2026 update keeps the shift to outpatient on track. We'll get the details in the final rule later this year. For purchasers, employers are leaning harder on claims transparency.
00:14:59
Speaker
Where they have full data rights, you see more site of care redirection and more interest in ASC partnerships. Looking at platforms, major operators and health systems continue to expand on the ASC side.
00:15:11
Speaker
Capital, development, and integration work are all pointed at outpatient growth. Looking at the workforce, anesthesia is still the practical bottleneck. Coverage models are evolving under reimbursement pressure and the centers that run predictable days are the ones most likely to keep coverage.
00:15:28
Speaker
And finally, on the AI front, interest is up, adoption is measured. The near-term wins are practical and focused on improving business efficiency and streamlining your processes.
Upcoming Conferences and Knowledge Sharing
00:15:40
Speaker
And as we look ahead to the next month, there are a number of state conferences and, of course, the Becker's ASC conference in Chicago, October 16th through 18th. So lots of places to compare notes in person with your colleagues. I encourage you to get out there, meet some folks, make some new friends, bring your team along and find a couple of new ideas that you can start implementing right away.
00:16:02
Speaker
And with that, we wrap up today's episode of This Week in Surgery Centers. I hope today was helpful for you as you gear up for an always busy Q4. We have some incredible guest conversations lined up over the next few months, so be sure to check back often for new episodes, and we'll see you again next time.