The Ambulatory Surgery Center Association filed comments June 9 with CMS pushing back against potential inclusion of ASCs in the Transforming Episode Accountability Model, arguing the program is poorly structured for the ASC setting and could slow the migration of high-value procedures out of hospitals.
In its response to CMS’ fiscal year 2027 inpatient prospective payment system proposed rule, ASCA told CMS Administrator Mehmet Oz that ASCs are not the appropriate entity to coordinate 30-day post-discharge episodes of care. Unlike hospitals, ASCs are typically small, streamlined facilities that direct patients to their surgeon’s office rather than the ASC itself if complications arise after discharge. The decision to perform a procedure in an ASC also originates outside the center, meaning ASCs lack the care coordination infrastructure TEAM assumes.
ASCA also raised concerns about what mandatory episode-based payment could do to procedure migration. ASCs currently perform more than 42,000 total knee replacements and more than 24,000 total hip replacements annually. KNG Health Consulting found that ASC performance of total knee replacements alone saved Medicare $624 million from 2020 to 2024, with projections suggesting $2.8 billion in savings over the next 10 years. ASCA warned that forcing ASCs into TEAM could prompt some centers to drop Medicare joint replacement lines rather than assume episode accountability, pushing procedures back into higher-cost hospital settings.
The letter also flagged a structural equity problem for beneficiaries: a total knee replacement at a hospital outpatient department costs a Medicare fee-for-service patient $1,736, capped at the inpatient deductible. The same procedure at an ASC costs a patient $1,878, the full 20% coinsurance with no cap. ASCA said it cannot support any payment model incorporating high-cost procedures until that disparity is resolved.
On EHR readiness, ASCA noted that only about 50% of ASCs currently use an electronic health record, compared with 90% of hospitals by 2014. A July 2025 ASCA member survey found 43% of EHR-using centers have concerns about connecting to external programs and 40% have concerns about exchanging patient information. These gaps would need to be addressed before CMS could rely on health IT infrastructure for episode accountability, ASCA said.
ASCA recommended that any future episode-based model featuring ASCs be implemented with voluntary participation.
“Surgery centers are not well-suited to participate in episode-based payment models as currently constructed,” ASCA CEO Bill Prentice said in a statement. “We look forward to collaborating with CMS on the best mechanisms that leverage the advantages of ASCs.”
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