As ASC leaders wait for CMS to release its final 2027 outpatient payment rule, expected in the coming weeks, many are focused on whether the agency will change course on reimbursement.
The proposed rule, released July 2, includes a 2.4% payment update for ASCs and hospital outpatient departments. It also adds 618 procedures to the ASC covered procedures list and removes 637 more procedures from the inpatient-only list as part of a three-year phaseout. In addition, it expands site-neutral payment to certain imaging services at off-campus hospital outpatient departments.
Becker’s connected with eight ASC and physician practice leaders to ask which policy in the proposed rule concerns them most. A common theme emerged: CMS is pushing more complex cases into ASCs, but payment isn’t keeping pace.
The question: Which policy in CMS’ 2027 OPPS/ASC proposed rule concerns you most for your practice or center, and why?
Editor’s note: Responses have been lightly edited for clarity and length.
Michael Boblitz. CEO, Athens Orthopedic Clinic (Athens, Ga.): Funding a 2.4% increase to hospital outpatient services in 2027 by cutting physician reimbursement under Medicare Part B is not good, and only accentuates the increased shortage of physicians that cannot sustain further cuts. Continued cuts to physician reimbursement force physicians to seek hospital employment or professional services agreements. That shift not only increases Medicare costs by up to 20% with the move from in-office to hospital-based pricing, but the cost to the private insurer, and their client the private business, can increase by up to 50% or more. CMS should expand the incentive introduced in 2026 to perform more work in physician offices to the ASC setting in 2027, for example by increasing physician reimbursement by 3% or more for orthopedic surgery performed in ASCs. That rewards physicians for working in lower-cost settings and results in a net overall savings to Medicare Part B by shifting cases from higher-cost hospital settings.
Adam Bruggeman, MD. CEO and surgeon, Texas Spine Care Center (San Antonio): The ASC weight scalar introduced in 2007/2008 continues to create issues and threatens ASCs long term. For those who don’t know what the scalar is, it essentially is budget neutrality applied to ASCs. In the ASC setting, lowering the scalar has the effect of paying less for non-device-intensive procedures while paying more for device-intensive procedures. CMS proposes to reduce the scalar related to 340B changes in the hospital fee schedule, which has the effect of lowering payment for 85 out of the top 100 highest-volume ASC procedures. ASC rates are now falling from about 53% to 44% of the hospital rate. This continues to undercut CMS’s own goal of moving care to lower cost settings while simultaneously adding 618 procedures to the ASC list. We need to get rid of the scalar once and for all as so many of the societies have requested over the years.
Brian Cohen, MD. CEO, Miami Anesthesia Services (Miami): My main concern is that the payment methodology is not keeping pace with the policy to support these more complex cases in the ASC. I am confident that my anesthesia colleagues will continue to act as responsible gatekeepers for this shift, using patient selection to direct each case to the safest and most appropriate setting. If payment can be aligned to support this migration, everyone benefits. Patients will gain access to safe, cost-efficient care, ASCs will grow responsibly, and hospitals can focus their resources on higher acuity patients.
Travis Doering, MD. Owner, Upper Extremity ATX (Austin, Texas): What concerns me most is how fast site of service is moving: the inpatient-only list is being phased out, hundreds of codes are being added to the ASC list, and site-neutral payment keeps spreading. I’m an independent hand surgeon operating in a physician-owned surgical hospital, and I’m not opposed to moving appropriate cases to lower-cost settings. Most hand surgery should be outpatient. My concern is that payment policy is moving faster than the evidence on patient selection. Meanwhile, high-value, physician-led facilities that are paid as hospitals keep getting squeezed toward ASC economics while still carrying hospital-level overhead and regulatory burden. I’d like to see CMS pair site-neutral payment with site-neutral regulation, so physicians can choose the setting based on the patient rather than the payment.
Julie Jackson, NP. Chief Administrative Officer, GI Associates (Milwaukee): The policy that concerns me most is the proposed ASC payment methodology, which produces a headline 2.4% update but still reduces reimbursement for many of the highest-volume procedures performed in our endoscopy centers. For example, the proposed national rates would decrease payment for colonoscopy with lesion removal and colonoscopy with biopsy by about $20 per case, and EGD with biopsy by about $15 per case. All 10 of the highest-volume ASC procedures are projected to receive lower reimbursement despite the stated update. Since this is still a proposed rule, we are members of national organizations who are urging CMS to evaluate procedure-level impacts rather than relying on the average update alone.
Neeraja Kikkeri. CEO, North Texas Team Care Surgery Center (Mesquite, Texas): What concerns me most is the proposed 2.4% payment increase. This is not a good increase reflecting the economics of today. At our independent ASC, we still must pay for staffing, anesthesia coverage, and supplies, and that increase leaves little room to absorb rising costs. Allowing more procedures in ASCs is helpful, but we must be able to afford to do them. For some cases, the implant alone can cost more than Medicare pays. Payment rates need to reflect those costs if CMS wants more independent centers to continue offering these procedures to Medicare patients.
Patrick McEneaney, DPM. Owner and CEO, Northern Illinois Foot & Ankle Specialists (Crystal Lake, Ill.): CMS is counting on ASCs and doctors’ offices to absorb more of the surgical volume with an increase of over 600 proposed procedures. The problem is that the 2.4% increase doesn’t keep up with staff costs, supplies, and other overhead plaguing ASCs. Additionally, the implants consume much of the payment to the facility. This gap between payment and cost determines whether the case can be performed in the ASC. ASCs are happy to take on more procedures, but they cannot carry the burden of all increasing costs. I feel that this factor isn’t sufficiently considered when these proposals are made. If they increased reimbursement for ASCs, more cases could be pulled away from costly hospital settings.
Raghu Reddy. CAO, MiOrtho Surgery Center (Southfield, Mich.): As CAO of a multispecialty ASC, my biggest concern is the 2.4% payment update. Our staffing, anesthesia, and supply costs are rising faster than CMS’s forecast, so each ‘increase’ is really a margin cut. CMS wants ASCs to take on more complex cases as the inpatient-only list shrinks, but it has to pay what those cases actually cost. This goes unaddressed among many things.
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.
