In 1970, the first Ambulatory Surgery Center was established in Phoenix, Arizona by two physicians who saw an opportunity to establish a high-quality, low cost alternative to hospital care for surgical and procedural services. These Ambulatory Surgery Centers, known as “ASCs,” are healthcare facilities that specialize in performing same-day surgical procedures that do not require a hospital stay. In short, they provide an alternative to traditional inpatient hospital settings.
ASC facilities are licensed freestanding outpatient facilities that provide patients the opportunity to have surgical procedure services performed outside of the hospital setting, often referred to as an outpatient procedure. Some of the most common procedures in ASCs are cataracts, colonoscopies, and arthroscopic surgeries performed by Otolaryngologists, Gastroenterologists and Orthopedic Surgeons, respectively.
Even though they have existed for more than 50 years, the number of ASCs has grown most rapidly over the last 30 years. For reference, in the early 1990s ASCs peaked at just over 1,000 centers. Today, there are around 5,700 Medicare Certified ASCs in the U.S.
As payment systems evolve and shift to a more cost-effective outpatient service setting, ASCs will continue to be a focus from a place-of-service perspective. For this reason, it’s important to have a baseline understanding of how they operate, as well as the pros and cons they present in the healthcare landscape.
Pros of Ambulatory Surgery Centers
- ASCs are generally less expensive than hospital surgical procedures, making them a cost-effective option for most people. This is because outpatient procedures do not require additional costs associated with overnight hospital stays, such as ward charges, meals, nursing care, and some supplies. According to a recent Public Health article, outpatient procedures performed in an ASC can cost between one half and two-thirds less than the same procedure being performed in the hospital.
Convenience and Efficiency
- Ambulatory Surgery Centers offer patients the convenience of scheduling same-day surgeries, making it easier for them to fit the procedure into their busy schedules. ASCs are also normally more efficient from a process perspective than traditional hospitals, with shorter wait times, less paperwork, and streamlined procedures.
- In an ASC, it takes far less time to prepare an operating room than in a traditional hospital setting. This allows physicians to treat more patients than they could in a hospital in the same amount of time.
- ASCs are equipped with state-of-the-art technology and qualified personnel that deliver high-quality care to patients. Because ASCs only focus on one type of procedure, the staff has the necessary expertise to ensure safe and efficient outcomes.
Ownership Potential and Provider Benefits
- In certain ASCs, there is an option for the physicians to invest and become partial or full owners. This leads to increased autonomy and incentivization, which can translate to increased quality of care and better alignment of goals between the practicing physician and the surgery center.
- The opportunity to bill the global fee and benefit from both the technical and professional portion of the service provided is another major benefit to physicians.
- Physicians can set the standards for safety, staffing, postoperative care, and more, versus having members of an administration decide for them. From a compliance perspective, physicians are much less restricted in an ASC setting.
Cons of Ambulatory Surgery Centers
Limited Ability to Handle Emergent Cases
- ASCs are not always equipped to handle higher acuity cases that require significant support, which can pose a risk if the patient undergoes significant complications. Patients with a history of complicated medical conditions like high blood pressure or high blood sugar levels must disclose this information to the surgeon to correctly manage and prevent any emergencies.
Limited Insurance Coverage
- Insurance coverage for ASCs is quite limited to specific outpatient surgical procedures. This makes it essential for patients to consult with their insurance company to ensure coverage is in place before undergoing surgery at an ASC.
- Patients who undergo a surgical procedure at an ASC may have to travel to separate facilities to receive rehabilitation or follow-up care, leading to added expenses and inconvenience.
Outpatient Procedures Only
- Not all surgical procedures are appropriate for an ASC setting, presenting a limitation of services performed from a regulatory perspective. For example, spinal surgery is a procedure that would very likely not qualify for an ASC and would ultimately be left to the discretion of the surgeon, as the safety of the patient always comes first.
Legal and Regulatory Issues
- Through CMS, government involvement with outpatient facilities has increased in recent years. As the number of for-profit ASCs increases, legal and regulatory questions rise as well. The biggest issue from a governmental perspective is the reimbursement for procedures performed in ASCs.
- Some observers believe that ASCs are being overpaid for services to CMS patients, as the CMS fee schedule is based on data from nearly 30 years ago.
As the healthcare landscape continues to evolve, ASCs and other alternative surgery methods are certain to remain a point of conversation. Ambulatory Surgery Centers, as we’ve shared, have many advantages, but also raise areas of concern, especially when considering the surgery type and patient’s health history. Other options, such as traditional inpatient hospitals and HOPDs (hospital-based outpatient departments), present pros and cons of their own, so a thorough discussion with a physician of benefits and any potential risks is always recommended when determining the best surgery options and location.
ASC usage is expected to keep growing in 2023 and beyond. Continue checking the MMG blog, or reach out to us directly, if you’d like to learn more.