ASCs face rising financial pressures on multiple fronts, from declining reimbursements to rising costs of supplies and labor.
This trend has pushed vendor and payer contract negotiations to make-or-break status for many ASCs. In its annual report to Congress released March 12, the Medicare Payment Advisory Commission found that the number of ASCs nationwide grew more than 2% per year on average between 2019 and 2024, and the volume of ASC surgical procedures per fee-for-service beneficiary increased 3.5% in 2024 alone, after growing at an average annual rate of 1.3% from 2019 to 2023.
While this growth indicates significant opportunities for facility growth, many ASCs are still struggling to keep pace with demand as margins become increasingly thin.
Melissa Rice, administrator of Loyola Ambulatory Surgery Center at Oakbrook Terrace (Ill.), recently joined Becker’s to discuss her organization’s process for collecting and presenting data in contract negotiations to keep her center ahead of rising costs.
Editor’s note: Responses have been lightly edited for clarity and length:
Question: What’s your biggest challenge when it comes to pulling together the right data ahead of a contract renewal?
Ms. Melissa Rice: One of the biggest challenges in preparing for a contract renewal is pulling together accurate, aligned data from multiple sources and ensuring it tells a consistent, credible story across clinical, financial, and operational teams. Even when the data exists, the real hurdle is translating it into clear, compelling insights that demonstrate value — highlighting quality, efficiency and market competitiveness in a way that resonates with payers and supports stronger negotiation outcomes.
Q: How has your approach to vendor negotiations shifted over the past couple of years given supply chain pressures?
MR: Over the past two years, our approach to vendor negotiations has become more proactive, data-driven and collaborative in response to ongoing supply chain pressures. We engage vendors earlier, use utilization and benchmarking data to guide decisions, and prioritize total value — including reliability and performance — over unit cost alone.
At the Becker’s 32nd Annual Meeting: The Business and Operations of ASCs, taking place October 29-31 in Chicago, ASC leaders, surgeons and healthcare executives will explore strategies to drive growth, enhance operational performance, navigate reimbursement challenges and prepare for the future of ambulatory surgery. Apply for complimentary registration now.