St. Louis-based Ascension’s transformation journey following the financial strain of the COVID-19 pandemic has included strategic divestitures, market exits, a $2.66 billion financial turnaround, and its $3.9 billion acquisition of AmSurg in early June. With the deal closure, Ascension has become the third-largest ASC operator in the U.S. and expanded its footprint to more than 300 surgery centers.
For Amber Sims, executive vice president and chief strategy and growth officer for Ascension, the context of the organization’s past is important to acknowledge.
“We looked at ourselves and said we had to change ultimately,” Ms. Sims said. “We needed to do three things: pull out what we call our ambulatory horizontal businesses because those are growing faster than our core. At the time, that included ASCs. We also needed to develop a new operating model that gave us that rigor to be able to really think about resilience. Then we also had to go on a journey of portfolio transformation.”
Ascension spent years reducing its hospital count from 139 to roughly 90, absorbing significant losses, and rebuilding around a new operating model before positioning itself for growth. The AmSurg deal came out of looking at its ambulatory surgery chassis and concluding it was not growing fast enough.
“To build it ourselves, it would take way too long to get to where we needed to go,” Ms. Sims said. “So we looked at all platforms available and said, where can we align from a mission and operating standpoint, and what organizations make best sense?”
She said AmSurg stood out partly because its operating model closely resembled Ascension’s own, focused on growth, optimization and rate management, and partly because of cultural alignment. Ascension retained AmSurg’s executive leadership.
“We are not converting AmSurg into Ascension,” Ms. Sims said. “We are working on synergies, and three of those synergies include business development and growth, managed care, and supply chain.”
Ms. Sims sees the platform as an industry offering: a flexible, nonprofit alternative to the dominant for-profit ASC operators including Tenet Healthcare’s USPI, which operates more than 535 ASCs and surgical hospitals, and Optum’s SCA Health, which operates more than 370 ASCs. She described the nonprofit model as more nimble and better positioned to serve poor and vulnerable populations in the communities where Ascension already operates.
“We are much more nimble,” Ms. Sims said. “We do not have a cookie-cutter model that says, hey, you get this fee; you can’t buy up to this amount. We are looking at how we best serve the needs of the community.”
Ascension is also learning from AmSurg. The platform has more than 2,000 physician investors and more than 3,500 affiliated investors, and Ms. Sims said physician satisfaction scores within AmSurg are notably strong, something Ascension is actively studying as it works to improve its own provider culture.
The ambulatory strategy is not measured in buildings or procedure volumes. Ms. Sims described Ascension tracking unique lives served, alongside metrics like ED readmission rates and primary care access times. The system has added primary care physicians steadily and cut average patient wait times by three days. In communities where AmSurg brings new market presence, Ms. Sims said the approach is to build end-to-end access ecosystems, wrapping primary care, imaging and physical therapy around the surgical platform.
“We’re not looking at this as really an asset strategy,” Ms. Sims said. “We’re looking at AmSurg and our ambulatory as an access and service line strategy.”
That framing extends to Ascension’s charity care commitments. The system reported $3.4 billion in community benefit last year, and Ms. Sims said the nonprofit differentiation in the ASC space has to show up in policy and practice.
Historically, Ms. Sims said, hospital operators and markets shared one pool of capital, and it flowed toward acute care because inpatient revenue was higher. Ascension carved out dedicated capital streams for ambulatory and for AmSurg ASCs specifically so the two are not competing.
“Many hospital systems, us included in the past, would have hospital operators and markets that had one pool of capital,” Ms. Sims said. “That one pool of capital, they would invest every day, all day long, in adding in acute care because the revenue was higher, but not because the growth was higher in a different area. So we decided to carve that capital out so that we’re not competing and that we dedicate fueling the ambulatory investments in a different way.”
The strategy is drawing interest from peer systems. Ms. Sims said multiple health systems have approached Ascension about partnership models in the ambulatory space, structures that have not yet been fully defined.
“We believe all health systems will need an ASC platform,” Ms. Sims said. “Many health systems are already engaging us on how we think about partnering together in new and unique ways, which honestly have yet to be imagined.”
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.