Prior authorization is no longer just an administrative hurdle for ASCs; it is a defining constraint on growth.
As authorization requirements expand, policies shift and payer scrutiny intensifies, ASCs are being forced to rethink expansion timelines, staffing models and financial risk tolerance.
Here are five notes:
1. A growing share of ASC cases now require prior authorization: Prior authorization rates are increasing at ASCs, according to HST Pathways’ latest State of the Industry Report, which surveyed 590 ASCs across 47 states.
Forty-six percent of ASC cases completed preauthorizations in 2024, up from 42% in 2023. While only 24% of cases that required prior authorization completed the process in 2024, a modest increase from 21% the year prior, the rising volume of cases subject to prior authorization adds to the administrative load.
2. ASCs are adopting aggressive, hands-on strategies to keep cases moving amid prior authorization delays: As prior authorization paperwork intensifies, some ASCs are proactively treating it as a daily operational challenge rather than a back-end billing issue. Leaders are enlisting patients early, escalating documentation, proceeding with time-sensitive cases despite authorization risk and using payer contract negotiations as leverage to protect patient access.
“We’re actively fighting the insurance company regularly and escalating every single time,” Elisa Auguste, administrator at East Setauket, N.Y.-based Precision Care Surgery Center, told Becker’s.
While these approaches can help avoid care delays, she cautioned that absorbing denied cases is not financially sustainable: “The problem is it’s not a sustainable system.”
3. Regulatory and reimbursement uncertainty is complicating ASC expansion decisions: ASC growth plans are being disrupted by shifting CMS policy and increased payer friction. Delays and reversals of previously favorable CMS policies, including pullbacks on covered procedures and site-neutral payment efforts, have created uncertainty around which services ASCs will be reimbursed for.
At the same time, new mid-cycle quality reporting requirements and tighter prior authorization and claims scrutiny are increasing administrative burden, forcing many centers to reconsider expansion timelines and devote more resources to compliance and revenue cycle management.
4. CMS’ Medicare prior authorization pilot signals expanding federal oversight of prior authorization for outpatient procedures: CMS’ Wasteful and Inappropriate Service Reduction initiative requires prior authorization for certain services in multiple states under a pilot program running through 2031.
The WISeR model applies to providers, including ASCs, in Arizona, Washington, New Jersey, Texas, Ohio and Oklahoma, with CMS contractors using a combination of AI tools and clinical review to evaluate requests. CMS has also outlined future features such as “gold carding” exemptions for clinicians with high approval rates, though the model has drawn scrutiny from lawmakers concerned about AI-driven authorization decisions. For ASCs, WISeR reflects how prior authorization requirements are increasingly shaping outpatient growth strategy and compliance planning.
5. Insurers pledged major prior authorization reforms — but ASC leaders remain cautious: Nearly 50 major insurers have announced voluntary commitments to simplify prior authorization across commercial, Medicare Advantage and Medicaid managed care plans, potentially affecting 257 million Americans.
The plans include reducing prior authorization requirements beginning in 2026 and moving toward standardized electronic processes with most approvals delivered in real time by 2027, though physicians and ASC leaders say meaningful impact will depend on how consistently the changes are implemented.
