By Bill Prentice
Ambulatory surgery centers (ASC) will experience meaningful expansion this year, but the growth will be slow and gradual. Market dynamics and government policies will play an important role and result in an uneven growth. The healthcare industry as a whole is in transition with growing emphasis on cost-effective, high-quality and patient-centric care delivered outside traditional hospital settings. Consequently, ASCs have emerged as one of the most dynamic segments of modern healthcare delivery.
Sg2’s 2025 Impact of Change Forecast projects total adult ASC volume to grow 21 percent over the course of the decade. Surgical utilization in the ASC is expected to grow 23 percent and account for more than 75 percent of billable activity. The markets that adopt ambulatory surgery more aggressively will see higher growth percentages.
This projected growth will be aided by the Centers for Medicare & Medicaid Services’ (CMS) 2026 final payment rule for ASCs and hospital outpatient departments (HOPD). The rule added 573 codes to the ASC Covered Procedures List (ASC-CPL).
A big part of ASCA’s advocacy efforts is convincing CMS that there are more procedures that can be safely performed in surgery centers. In many instances, these are procedures that are already being performed on the non-Medicare population in our facilities. Allowing the migration of more procedures would give patients more choice and save Medicare substantial amounts of money since ASCs are generally reimbursed at rates 50 percent or less than those paid to hospitals. The 2026 final rule responded to many of the arguments that ASCA has been making and proposed certain sweeping changes for the years ahead. One of those important changes is the addition of 573 codes to the ASC-CPL.
Out of the 573 added codes, 302 include cardiovascular, spine and vascular procedures that ASCA requested CMS to add. Sg2 projects robust growth in ASCs in total hip, knee and shoulder replacements over the next five years. However, despite the momentum, the actual rate of migration of these cases will vary. In some markets, ambulatory settings perform fewer than 10 percent of total joint replacements, while in others as much as 48 percent, according to Sg2’s 2024 data. And while primary hip and knee replacements are moving to ASCs, 75 percent of these procedures are still performed in HOPDs.
Sg2 also forecasts a quickening of cardiac procedure volumes in ASCs, especially for electrophysiology (EP) procedures. Cardiovascular ablations will grow 26 percent across the combined inpatient and outpatient settings over five years, according to Sg2. In the 2026 final rule, CMS added cardiac catheter ablation procedures to the ASC-CPL with strong encouragement from ASCA and support from clinical societies.
The rest of the 271 codes of the 573 came off of the inpatient-only (IPO) list as part of CMS’ bigger sweeping three-year removal process of the IPO list. We are not anticipating a significant shift in volume for those IPO codes. Most of those codes were not ones that we requested for addition to the ASC-CPL.
Growth Drivers
The growth of the ASC market will depend on national and state factors, as well as each ASC’s readiness to mold and adapt to change. On the federal level, the expansion of the ASC-CPL, phasing out of the IPO list and site-neutral payment proposals have created a perfect opportunity for ASC growth. On the state level, certain states are loosening certificate of need (CON) laws, and reforming facility fees and site-of-service billing restrictions. And while insurers are pushing to move ambulatory-appropriate cases to lower-cost sites of care, physicians are showing more interest in ASC ownership and autonomy, and patients are seeking out convenience, speed of procedure and lower out-of-pocket costs for their procedures. ASCs will have to take this opportunity and run with it. However, surgery centers will have to keep in mind that adding complex procedures requires staff training and deeper investments in infrastructure, sterile processing and scheduling discipline.
ASCs also will need to keep an eye on the local market when adding more complex procedures. According to Sg2, in half of all hospital service areas (HSA) in the country, fewer than 14 percent of surgeries are performed in ASCs. In contrast, the HSAs with the fastest ASC adoption perform nearly a third of their surgical cases in ASCs. Market dynamics drive this uneven adoption. For instance, Colorado has no CON restrictions and, according to Sg2, has seen 40 percent of endoscopy cases migrate to ASCs; whereas Illinois, which has strict CON laws, still sees 73 percent of gastrointestinal endoscopy cases in HOPDs.
Conclusion
CMS’ 2026 final rule represents a significant policy moment for ASCs. The rule recognizes ASCs as integral players in the healthcare delivery system and supports expanded clinical opportunities. Surgery centers that proactively understand and adapt to these changes stand to benefit from enhanced Medicare reimbursement and an expanded portfolio of services.
As CMS continues to evolve its outpatient and surgical payment systems in subsequent years, ASCs will need to stay attentive to emerging clinical opportunities to optimize their strategic trajectory in the Medicare landscape.
