Ambulatory Surgery Centers

Industry Profile Report

Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters

Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Call Prep Questions, Industry Terms, and Weblinks.

Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.

Industry Profile Excerpts

Industry Overview

The 5,900 ambulatory surgery centers (ASC) in the US provide facilities and services to physicians to perform medical procedures that do not require an extended patient recovery period. Common services include eye procedures, endoscopies, biopsies, pain management treatments, and orthopedic procedures. Physicians have some type of ownership interest in about 93% of ASCs. Through joint ventures, hospitals have ownership interest in at least 28%.

Dependence upon Insurers

ASCs derive the majority of their revenue from third-party payers, including private insurers, managed care systems, and government sources, such as Medicare and Medicaid.

Legislation Targets Physician-Owned Centers

Amendments to Stark laws, which prohibit self-referrals for Medicare and Medicaid beneficiaries, limit growth opportunities and could significantly change ownership structures for ASCs.

Industry size & Structure

A typical ASC operates out of a single location, employs about 30 workers, and generates $7.3 million in annual revenue.

    • The ASC industry consists of about 5,900 companies which employ 176,300 workers and generate $43.1 billion annually.
    • There are about 7,600 freestanding ASCs in the US. Of these, around 72% are Medicare-certified facilities.
    • Physicians have some type of ownership interest in about 93% of ASCs. Through joint ventures, hospitals have ownership interest in 28%. Only 3% of ASCs are owned entirely by hospitals.
    • About 25-30% of ASCs are owned by multiple facility chains.
    • Large companies include Amsurg, United Surgical Partners, Surgical Care Affiliates, HCA, NueHealth, and Surgery Partners.
                              Industry Forecast
                              Ambulatory Surgery Centers Industry Growth
                              Source: Vertical IQ and Inforum

                              Recent Developments

                              Jun 16, 2024 - Employment Increases
                              • Ambulatory surgery center industry employment increased slightly during the first four months of 2024 while average wages for nonsupervisory employees decreased slightly, according to the US Bureau of Labor Statistics (BLS). Ambulatory surgery centers sales are forecast to grow at a 5.1% compounded annual rate from 2024 to 2028, faster than the growth of the overall economy.
                              • Higher acuity cases continued moving to the ambulatory surgery center (ASC) setting in 2023, according to Becker’s ASC Review. The shift is expected to continue in 2024, with the Centers for Medicare & Medicaid Services (CMS) moving total shoulder arthroplasty to the ASC Covered Procedures List. Significant changes in the regulatory landscape occurred in 2023, particularly with the liberalization of Certificates of Need (CON) requirements for certain states. The changing of CON regulations is poised to further accelerate the development opportunities of ASCs, enhancing their ability to meet the increasing demand for outpatient surgical care, according to Becker’s ASC Review.
                              • The pressure of labor shortages, inflation, and COVID-19 on the healthcare industry’s financial health is easing, according to professional services firm McKinsey. Health-system margins remain below pre-pandemic levels, however. Segments within health systems that can expect higher growth in profit pools through 2027 include outpatient care settings such as ambulatory surgery centers and physician offices, with growth driven by site-of-care shifts.
                              • The Centers for Medicare and Medicaid Services (CMS) is adding pre-treatment approval requirements for some procedures covered by Medicare that are performed at certain ambulatory surgery centers (ACSs), according to Axios news service. Medicare has seen a sharp uptick in billings from the centers that are being hit with the requirements. Approval will be required for 40 services related to five procedures, including rhinoplasty, eyelid lifts, and varicose vein treatments. The procedures have cosmetic as well as medical purposes. Medicare covers the services as medical treatments, but billing for cosmetic purposes is considered fraud.
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