Bad debt and charity care per calendar day rose 18% nationally in March 2026 compared to March 2025, and 46% compared to the first quarter of 2023, according to Kaufman Hall’s National Hospital Flash Report.
The forces behind those numbers, such as coverage loss, inflation-driven patient cost sensitivity and delayed care, are not unique to hospitals. Most ASC operators have watched the hospital bad debt story from a distance, but their payer mix might not provide insulation.
Why payer mix is not a permanent shield
Commercial insurance and Medicare dominate most ASC revenue, and both patient populations have relatively stable coverage. But the conditions are changing. Medicaid changes passed into law in 2025 could result in 10 million more uninsured individuals over a decade. Around 5 million fewer people are expected to enroll in ACA marketplace plans in 2026 compared with 2025, according to KFF. Starting Dec. 31, states must conduct eligibility redeterminations every six months for Medicaid expansion populations, adding administrative burdens expected to push more people off the rolls even if they remain eligible.
As coverage erodes, a portion of newly uninsured patients will not stop needing gastroenterology, orthopedic or pain procedures. They will show up uninsured or underinsured. Hospitals are subject to EMTALA obligations and have charity care infrastructure, but that is not the case with most ASCs. Physician-owned centers in particular tend to operate with lean billing and collections teams. A modest shift in payer mix toward self-pay can have an outsized effect on cash flow when the infrastructure to absorb it is not in place.
Rising case acuity, tighter payer scrutiny and expanding administrative requirements are already placing new pressure on ASC business offices that were originally built for a simpler environment. Adding uninsured volume management to that list compounds the exposure.
The specialties and markets most exposed
Not all ASCs face equal risk. ASCs in specialties with higher Medicaid patient populations, including GI and pain management, face more direct exposure than centers weighted toward commercial payers.
Geography matters. The Congressional Budget Office estimates that expansion states will see uninsured rates rise five times more on average than non-expansion states under the new Medicaid work and verification rules. ASCs in high-expansion states — those with the largest ACA Medicaid populations — face a more acute version of this risk than centers in states that never expanded.
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