Ascension is selling its ownership stake in Mercy Care, an Arizona Medicaid insurer, to CVS Health-owned Aetna — the latest in a string of moves by the nonprofit hospital giant to exit non-core insurance businesses and redirect capital toward outpatient care, including its recent, far larger bet on ASCs.
Ascension has co-owned Mercy Care with CommonSpirit’s Dignity Health since the plan was founded in 1985, though Aetna has run its day-to-day operations since 2002. Terms of the deal weren’t disclosed, and it’s still pending regulatory approval.
Ascension exited the Texas ACA marketplace in 2024, sold its stake in insurer Network Health to Froedtert Health in 2023, and has now shed its Arizona Medicaid plan.
Mercy Care is profitable, reporting $34 million in income last year on roughly 404,000 members. At the same time, Ascension has moved aggressively in the opposite direction on outpatient surgery: it closed its roughly $3.9 billion acquisition of Amsurg, one of the largest ASC operators in the country, expanding its ambulatory footprint from 58 to 312 ASCs.
Ascension is stepping back from insurance risk, while doubling down on ASCs and outpatient care, and it isn’t alone in its retreat from the insurance side.
Providence and Baylor Scott & White have also exited health plan businesses this year, as more integrated systems conclude that owning an insurer isn’t worth the regulatory uncertainty and rising medical costs that come with it.
The exodus in insurance ventures also comes along with increased investments in outpatient care. Health systems are increasingly doubling down on ASC ventures, and Ascension is not the only one. Nine health system leaders told Becker’s they expect ambulatory care to remain a major growth driver into 2027, citing coverage gaps, payer pressure and an aging population pushing more care into outpatient settings.
Kaufman Hall’s latest National Hospital Flash Report found outpatient revenue per calendar day rising faster than inpatient revenue, prompting analysts to warn that “hospitals without an outpatient footprint will struggle.”
Cleveland Clinic, Bon Secours Mercy Health and ChristianaCare have struck similar ASC partnerships this year.
Ascension’s approach stands out for its scale and structure. The Amsurg deal made it the third-largest ASC operator nationally, behind only Tenet’s USPI and Optum’s SCA Health, and Chief Clinical Officer Thomas Aloia, MD, has said the system sees these centers as the foundation for a broader push into community-based and virtual care — “ambulatory procedural centers,” in his framing, rather than surgery-only ASCs.
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.
