From Medicare prior authorization to hospital pushback on site of care, ASCs spent 2026 fighting on several policy and payment fronts at once.
Here are five battles that shaped the year for surgery center operators and physicians:
1. Medicare prior authorization arrives at ASCs
CMS launched a five-year prior authorization demonstration for select ASC services in 10 states in early 2026, after delaying its original Dec. 1, 2025, start.
The first phase covered services on or after Jan. 19 in California, Florida, Georgia, Maryland, New York, Pennsylvania and Tennessee. Arizona, Ohio and Texas followed for services on or after Feb. 16, according to CMS.
The program targets blepharoplasty, botulinum toxin injections, panniculectomy, rhinoplasty and vein ablation. Participation is voluntary, but ASCs that skip prior authorization face prepayment medical review on those claims.
2. Physician pay cuts hit facility-based procedures
Two 2026 physician fee schedule policies hit surgeons who operate in ASCs and hospitals, and specialty societies are still fighting both.
CMS finalized a 2.5% “efficiency adjustment” to work RVUs for non-time-based services such as endoscopy, set to be recalculated every three years with no floor. It also overhauled practice expense methodology, raising office-based payments while cutting payments for services performed in ASCs and hospitals.
The American College of Gastroenterology said the practice expense change “fails to distinguish between physicians who are hospital employed versus those who are private practice, or physicians in private practice who typically perform procedures in an ASC.” The ACG said the efficiency cut essentially cancels out the 2.5% conversion factor increase for GI practices.
In comments on the CY 2027 proposed rule, the American College of Surgeons called for repeal of the 2.5% cut, citing its analysis of more than 1.7 million operations that found operative time rose 3.1% from 2019 to 2023. The ACS also opposed a proposed 50% payment reduction for same-day E/M services billed with modifier 25.
3. Hospitals and ASCs split over the 2027 payment rule
CMS’ 2027 outpatient prospective payment system and ASC proposed rule, released July 2, would add roughly 618 procedures to the ASC covered procedures list and remove 637 procedures from the inpatient-only list in the second year of a three-year phaseout. It proposes a 2.4% ASC payment update.
The American Hospital Association opposed the covered procedures list expansion in Aug. 28 comments, citing safety concerns about a “weakened standard” for ASC eligibility. The AHA also urged CMS to revert to its standard process for removing procedures from the inpatient-only list.
ASCs are not fully on board either. The Ambulatory Surgery Center Association supported the list expansion but objected to a proposed cut in the ASC weight scalar from 0.872 to 0.809, which it said would substantially reduce payment for high-volume procedures. The association also warned that eliminating the inpatient-only list could lower rates for procedures already on the ASC list.
The final rule is expected in November.
4. Certificate-of-need fights pit physicians against hospitals
State CON laws remained a flashpoint in 2026, with hospital associations and physician developers on opposite sides.
In Tennessee, the state’s 40-year-old CON law is set to be repealed by Dec. 1, 2027. Once that takes effect, independent ASCs must participate in TennCare and serve TennCare enrollees and charity patients at levels matching hospital-affiliated ASCs. HCA Healthcare supports restricting CON, while the Tennessee Hospital Association opposes reform.
“The certificate-of-need process has become nothing more than a free gratification,” Rep. Greg Vital (R-Harrison) said at a Jan. 8 event.
In North Carolina, a trial court upheld the state’s CON law on Dec. 12, 2025, rejecting an argument from Jay Singleton, MD, owner of Singleton Vision Center in New Bern, that it creates an unconstitutional “exclusive emolument” for incumbent providers. Lawmakers filed Senate Bill 1040 on April 30 to repeal CON requirements for ASCs and inpatient rehabilitation.
5. Payers squeeze ASCs over anesthesia
Anesthesia costs became a contracting fight in 2026, with ASCs caught between falling professional reimbursement and payer scrutiny of out-of-network providers.
UnitedHealthcare cut reimbursement 15% for QZ-billed CRNA services in select states and eliminated payment for several add-on and qualifying-circumstance codes. The share of ASCs expecting to pay anesthesia stipends rose from 28% in 2024 to 44% in 2025.
Mo Azam, MD, head of innovation at US Anesthesia Partners, warned that stipends are fueling an unsustainable “arms race.”
Some payers are also penalizing ASCs that use out-of-network anesthesia groups.
“Payers are coming after ASCs that allow out-of-network providers, including anesthesia, sometimes by terminating the facility contract outright,” Vijay Bachani, president and chief growth officer of Roslyn Heights, N.Y.-based New York Bariatric Group, told Becker’s.
Medicare anesthesia reimbursement has fallen 5.5% per unit since 2019 while CRNA salaries rose 59%, according to Marit Health and American Association of Nurse Anesthesiology data.
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.
