Advances in technology and the cost effectiveness of ASCs have made them a fast-growing market.
Here are 10 key takeaways:
1. Fast growth. The ASC market is projected to reach $60 billion by 2030, reflecting a compound annual growth rate of 6% from 2023 to 2030. Advancements in technology and devices are a big growth driver.
2. ASCs are gaining a greater share of high-acuity procedures. ASCs continue to perform a greater number of high-acuity procedures, particularly in orthopedics and cardiology. In 2023, CMS added 11 procedures to the ASC-covered list that were not included in the proposed rule, including total-shoulder arthroplasty.
3. The industry is still highly fragmented. According to a report from VMG Health, 68% of ASCs are independently owned. The remaining 32% are owned by ASC chains, the largest being Tenet's United Surgical Partners International and Optum's SCA Health, and other healthcare operators.
4. Private equity continues to eye ASCs, though activity has slowed. While many ASCs are independently owned, PE groups are playing an increasingly larger role in mergers and acquisitions. Two of the largest ASC chains — Surgery Partners and AmSurg — have PE ownership, and smaller groups are PE-backed as well.
5. Mega-mergers are shaping the industry. The three biggest include Tenet Healthcare’s $425 million majority purchase of Dallas-based United Surgical Partners in 2015, Nashville, Tenn.-based AmSurg and Envision Healthcare’s $10 billion 2016 merger and Optum’s 2017 acquisition of Deerfield, Ill.-based SCA Health.
6. ASCs struggle with staffing shortages. ASCs continue to face staffing shortages as they compete with hospitals and health systems who are able to offer higher salaries. This is consistent with staffing issues throughout the healthcare sector. The workforce lost 145,213 providers from 2021 to 2022.
7. Reimbursements are decreasing. CMS’ finalized payment rate for ASCs in 2024 is 3.1%, down from 3.8% 2023. Many leaders are concerned about how low reimbursements will affect their ability to meet margins.
8. Costs are increasing. Costs for supplies and staffing are high along with inflation. ASCs spend on average $2.2 million on employee salaries and wages, about 21.3% of net revenue, according to the VMG Health's "Multi-Specialty ASC Benchmarking Study."
9. Cardiology is the fastest growing specialty. ASCs are increasingly looking to cardiology for growth. In 2021, cardiology received the highest estimated Medicare payment increases, according to Avanza's "2022 Key ASC Benchmarks and Industry Figures" report.
10. Independent ASCs have an edge when it comes to physician recruitment. While physicians nationwide are migrating toward employed models, many are drawn to ASCs potential for more autonomy and control over the quality of care.