The rising cost of devices has recently had a drastic impact on the way ASCs operate. Twenty five-plus leaders told Becker’s how they have been impacted and detailed their workarounds.
The leaders featured below are speaking at Becker’s 31st Annual: The Business and Operations of ASCs, Oct. 16-18, 2025, at the Swissotel in Chicago.
If you would like to join the event as a speaker, please contact Scott King at sking@beckershealthcare.com.
As part of an ongoing series, Becker’s is connecting with healthcare leaders who will speak at the event to get their perspectives on key issues in the industry.
Editor’s note: Responses have been lightly edited for length and clarity.
Question: How have rising device costs affected your ASC?
Melissa Rice. ASC Administrator, Loyola Ambulatory Surgery Center, Trinity Health (Maywood, IL): Rising device costs have not significantly impacted our ASC operations, thanks to the strong constructs we have in place. We benefit from strategic partnerships and well-negotiated contracts that help us maintain cost stability. Additionally, our Group Purchasing Organization (GPO) pricing has been instrumental in offsetting potential increases, allowing us to continue providing high-quality care without compromising our budget. Our supply chain team works proactively to evaluate alternatives and ensure we’re leveraging the best value. While we remain vigilant about market trends, our current structure has helped us stay resilient. Overall, we’ve been fortunate to avoid major disruptions due to rising device costs.
Benjamin H. Levy III, MD. Gastroenterologist and Clinical Associate of Medicine, University of Chicago Medicine: Device cost increases at ASCs due to inflation and new technologies have the potential to constrict profit margins. It’s also important for ASCs to stay current with technology over time by purchasing new generation colonoscopes, larger 4K ultra-high-definition screens, and artificial intelligence driven software to detect polyps like GI Genius. To offset device/equipment costs, ASCs should maximally schedule endoscopy cases especially when there is a cancellation 24-48 hours prior through the help of nursing navigators and a nimble scheduling department. EGDs can more easily be added to the schedule since this procedure does not require a prep solution or special diet. Another strategy is to use volume and bundling when establishing supplier contracts.
Dariya Golan. CEO, Advanced Surgery Center of Clifton (NJ): We are primarily a GI center, and our focus is on maximizing the longevity of our equipment. To achieve this, we maintain a consistent, well-trained team that follows best practices in handling devices. In addition, we hold quarterly reviews with our vendor to evaluate repair trends and identify factors that may shorten device life. One of the key outcomes of these reviews has been addressing water hardness, which we recognized as a contributing factor to premature wear.
Marjorie Reiter. CEO and Administrator, Surgery Center of Central NJ: Rising device costs (and other materials beside devices) have led us to critically look at how we can bundle our case costs more efficiently. For example, our surgical packs are now all-inclusive and we have standardized most of them for the vast majority of our cases. We have also leveraged our relationships with our vendors and GPOs to ensure our pricing is most advantageous. We are also trying to limit the number of vendors from whom we purchase devices, extend our payment terms and pay for them with a new credit card vendor whereby we receive a percentage of our purchases back as cash.
George Hanna, MD. President, Director of Pain Management and Chief Transformation Officer, Vein Clinic and Pain Treatment Center, VIP Medical Group (New York, NY): Rising device costs have challenged ASCs to be even more innovative in balancing financial sustainability with patient access. In vein care, disposable closure devices, and in pain management, advanced implantable technologies such as spinal cord stimulators, represent high-cost inputs — yet they also deliver life-changing outcomes. By focusing on efficiency, smarter purchasing strategies, and value-based alignment with payers, ASCs are uniquely positioned to preserve strong performance while ensuring patients continue to benefit from cutting-edge treatments in a convenient, outpatient setting.
Jessica Lam, PhD. Practice Manager, Pacific Coast Anesthesia (Los Angeles): With device costs rising, efficiency and scheduling discipline matter more than ever. Surgeons need to be accountable for block time—starting cases on time, minimizing gaps, and bringing the cases they’ve committed to. Partnering with anesthesia is key because anesthesiologists see every service line and every inefficiency, and bring an objective perspective beyond any one specialty’s priorities. Using that lens ensures both expensive equipment and staff are being put to their best use.
Megan Friedman, DO. Chair and Medical Director, Pacific Coast Anesthesia (Los Angeles): Rising device costs have really squeezed ASC budgets. Robotics, scopes, and monitoring systems are essential investments, but the trade-off is that workforce spend often becomes the area under the most pressure. Anesthesia and nursing are sometimes viewed as variable costs, leading to adjustments in hours or shift lengths. The key is remembering that labor stability is just as important as the latest equipment—without it, efficiency, morale, and patient care will all be impacted.
Sumana Moole, MD. Physician and Founder, Gastroenterology & Gut Health LLC (Katy, TX): The surge in device costs has compressed our margins, forcing us to shift from passive acceptance to active cost management. Our strategy is twofold: First, we are pursuing rigorous device standardization to leverage volume with our GPO. Second, we now critically evaluate the clinical ROI of every single item, from high-cost equipment like endoscopes to high-volume disposables like biopsy forceps and snares. This process includes a deliberate analysis of premium brands versus clinically similar, cost-effective alternatives. Ultimately, this challenge has fostered a culture of cost-consciousness, making our physicians essential partners in procurement to ensure our financial health without sacrificing quality.
Pierce D. Nunley, MD. Director, Spine Institute of Louisiana; Medical Director, Spine Center of Excellence (Shreveport): Rising device costs have placed significant pressure on our ASC, particularly as reimbursement continues to decline. We cannot simply absorb these increases, so we focus on several strategies: negotiating construct pricing to ensure fair value, standardizing with preferred vendors to streamline costs, and exploring group purchasing organizations (GPOs) to gain volume-based savings. Additionally, we lean heavily on long-standing vendor relationships to find creative solutions. Ultimately, we remain diligent in balancing high-quality patient care with financial sustainability by refusing to accept unchecked cost increases.
Azizza Dorsey. COO, Advanced Pain Medical Group (Burbank, CA): Rising device costs require physician-owned ASCs to be very cautious with their devices and ensure that the equipment is monitored proactively. You cannot perform cases without safe, working and tested equipment. Equipment being down is the worst thing for smaller ASCs, for example a down C-arm for a pain day is very challenging and requires major revenue loss. Ensuring you have preventative maintenance contracts, a biomed person/team and are consistently monitoring the equipment to be proactive is imperative.
Also, monitoring equipment with obsolete parts and budgeting in advance for spends you will need to make the following year. Replacing a C-arm for a pain practice could take months to recover financially for a practice, but there are loans and other ways to support your practice. For example, don’t purchase a PRP machine, work with the vendor and only obtain the disposables, this ensures your equipment is always new and you can always return it if you don’t do those cases anymore.
Lindsay Lauderdale. Senior Director, Development, Huebner Ambulatory Surgery Center, LLC (San Antonio, TX): Rising device costs have placed significant financial pressure on our ASC by increasing the cost of performing cases without seeing an increase in reimbursement of these cases. It has decreased our overall margins, particularly those that require high-cost implants and devices. To mitigate these circumstances, we’ve had to be more diligent in reviewing reimbursement allowables and selecting cases we allow to be performed at the center, strengthen our vendor negotiations, while optimizing our supply chain management to preserve both clinical quality and financial sustainability. While patient care and outcomes remain at our forefront, these cost pressures require ongoing evaluation of case mix, supply utilization, and operational efficiencies.
Wael Barsoum, MD, Orthopedic Surgeon, Cleveland Clinic Florida (Weston): Rising device costs have certainly created pressures in the ASC space, especially since margins are already tighter than in hospital settings, but the reality is that the costs of running an ASC go far beyond implants and devices. Investments in IT, digital security, and infrastructure are also significant and continue to increase every year. This is where Healthcare Outcomes Performance Company (HOPCo) provides a distinct advantage. Through our national scale, data-driven contracting strategies, and robust digital platforms, we’ve been able to offset these challenges by helping ASCs manage device costs and also integrate the advanced technology and cybersecurity resources that individual centers often can’t achieve on their own.
HOPCo leverages its strong relationships with leading implant vendors to help reduce implant costs across our owned and managed facilities nationwide. We also collaborate closely with our physicians to standardize implant usage at each of our affiliate centers. In other words, while device costs continue to rise, our combination of vendor partnerships and clinical standardization enables us to mitigate – or in some cases offset – these increases.
By combining these digital services with evidence-based clinical pathways, HOPCo enables our ASC partners to deliver exceptional patient outcomes while keeping costs sustainable and predictable. No other organization combines clinical expertise, scale, and digital infrastructure the way HOPCo does, which is why so many ASCs turn to us to remain competitive in an increasingly challenging healthcare environment.
Candy Corral. Executive Director, Surgical Services, Rady Children’s Hospital Orange County (CA): As with other financial impacts, leaders must use creative solutions when managing rising device costs. Some of the techniques I have used involve collaborating with our surgeons to identify vendor selection and products that best meet our needs and collectively working towards negotiating supply rates. I strongly encourage transparency with my team. This has been helpful to mitigate waste and related expenses.
If you keep surgeon preference cards current, review supplies, devices, and implants for cost increases periodically, your team and surgeons will be less likely to open all supplies on the card until needed or surgeons may be open to switching products because another brand has a less expensive yet comparable item. Many times, it’s simply a matter of having the discussion with your surgeons to raise awareness of the cost increase. This can lead to better rapport, trust, and a common language around efficiency, quality, and collaboration.
Janet Carlson. Vice President, Ambulatory Surgery Centers, Commonwealth Pain & Spine (Louisville, KY): Margin Compression & Financial Strain
- Medical devices, supplies, and drugs-essential and non-negotiable items are consuming larger portions of ASC budgets due to persistent inflation and pandemic-related price hikes that have still not normalized.
- Operating expenses jumped nearly 9% in 2024, with direct costs per physician surpassing $1.1 million annually.
- Reimbursement rates are not keeping pace, especially under CMS’s bundled payment models, which often don’t cover the full cost of procedures.
Operational Strain & Delays
Limited availability of certain supplies has forced ASCs to anticipate capital expenses well in advance, increasing planning complexity.
ASCs are facing longer lead times for capital equipment due to supply chain disruptions. For example, some centers have waited over a year for sterilization equipment orders. I have also experienced long lead times for electrical panels as there is a significant bottleneck manufacturing these necessary components.
Thomas Hutchinson, Administrator, Surgery Center of Central Florida (Winter Park): At the Surgery Center of Central Florida, we continue to experience significant increases in supply costs, particularly within our vascular product lines. While disposable medical supplies across the board have risen in price, the impact has been especially pronounced in peripheral vascular products, including atherectomy devices and drug-coated balloons. Some vendors have projected cost increases of up to 20% in the near future.
From the industry perspective, these adjustments are often attributed to higher operating expenses associated with production and distribution. While this is an understandable challenge, the timing is critical: peripheral vascular procedures in the ambulatory surgery center (ASC) setting have recently seen reimbursement increases compared to office-based labs (OBLs). Unfortunately, this shift has not offset the rising costs and has instead negatively impacted our cost-per-case margins.
To address this challenge, we have placed greater emphasis on outpatient diagnostics, particularly CT angiograms, as a way to optimize case selection and reduce time in the operating room. By streamlining diagnostics and focusing on efficiency, we aim to preserve both clinical quality and financial sustainability in an evolving healthcare environment.
Nikhil Shetty, MD. COO, Midwest Interventional Spine Specialists (Downers Grove, IL): The pricing of devices and their variance can have several direct and indirect consequences in the operations, as well as the budgeting and finance sectors of the ASC.
ASCs are typically operating on a margin, and supply costs are a big contributor to that. When costs increase due to various reasons, the downstream revenue impacts can change the shape of healthcare delivery. Medicare and insurance reimbursement rates typically lag behind cost inflation, and ASCs will, unfortunately, absorb that difference.
This results in reduced margin per case, which then affects the volume of certain cases offered in certain markets, which ultimately impacts the regional healthcare landscape. These shifts have the potential to cut service/procedure lines if certain devices are no longer viable in the ASC.
In our ASC, we have standardized our device and supply chains as a lever against price increases; however, we are small and nimble enough to enter into newer agreements with vendors as the pricing market shifts.
As an ASC, we have the responsibility to do margin analysis and optimize vendor negotiations, supply standardization in the name of operational efficiency. We also rely on our societies to work with payors to ensure reimbursement rates reflect the rising costs of procedures.
Sean Gipson, Division CEO and President, Remedy Surgery Centers (Dallas): As a leader in the Ambulatory Surgery Center (ASCs) space, we have been responsible for the ability to deliver high-quality surgical care at a lower cost than hospital outpatient departments. Built on principles of operational efficiency, patient convenience, and streamlined workflows, ASCs have historically outperformed traditional hospital settings in both patient satisfaction and cost control.
But in today’s inflationary environment, those advantages are being tested. We have continued rising labor costs, persistent supply chain disruptions, stagnant reimbursement rates, and mounting overhead, which have created a perfect storm that is forcing many ASCs to reassess their financial models, operational strategies, and long-term sustainability.
Staffing has emerged as the most pressing cost concern. With ongoing shortages of perioperative nurses, certified registered nurse anesthetists (CRNAs), and surgical technologists, ASCs are struggling to maintain adequate staffing levels without blowing their budgets. Many facilities now rely on travel nurses or per diem staff solutions that offer flexibility but come at a steep premium. Our average hourly wages for perioperative RNs have increased by more than 20% over the past three years, while competition from hospitals and health systems continues to drive wage escalation.
ASCs are at a disadvantage because we can’t always match hospital compensation packages. In the industry, we are seeing burnout, early retirements, high turnover and all of which impact case throughput and revenue. Cost volatility isn’t limited to just labor. The price of surgical implants, disposable instruments, medications, and personal protective equipment has steadily increased since the COVID-19 pandemic began and many prices have never returned to pre-pandemic levels.
ASCs, which lack the bulk purchasing power of large hospital systems, are particularly vulnerable. Many are forced to overstock key supplies to avoid backorders, further straining their cash flow and storage capacity. We’re seeing 15–30% increases on some of our core supplies year over year. Perhaps the most significant pain point is the widening gap between operating costs and reimbursement. While CMS continues to support ASCs through site-of-service neutrality in certain areas, Medicare’s annual ASC payment updates, often 2–3%, fail to reflect the actual inflationary pressures ASCs face.
Commercial payers aren’t much better. Bundled payments, narrow networks, and downward pressure on negotiated rates are making it harder for ASCs to remain financially viable, especially those that remain independent. For years, we’ve kept costs down by being lean and efficient. However, we are now operating at a point where those strategies alone aren’t enough.
In response, the ASC industry is adapting in several key ways:
Consolidation: Many independent ASCs are partnering with hospital systems or management companies to gain access to capital, contracting leverage, and staffing resources.
Case mix optimization: Centers are reevaluating service lines, focusing on higher-margin procedures while eliminating low-reimbursement, resource-intensive cases.
Tech-driven efficiency: From automated inventory management to advanced scheduling platforms, ASCs are investing in technology to cut waste and boost productivity.
Flexible staffing models: Some are piloting team-based care models, cross-training staff, and offering creative incentives to improve recruitment and retention.
Despite current headwinds, the outlook for ASCs remains cautiously optimistic. Demand for outpatient surgical care continues to grow, particularly as payers and policymakers push to shift more procedures out of inpatient settings. The challenge lies in aligning financial structures with this evolving demand.
To stay competitive, ASCs must evolve, not just operationally, but strategically. That means leveraging partnerships, embracing innovation, and advocating for policies that reflect the true cost of care. With the right tools and support, ASCs can continue to fulfill their mission: delivering safe, efficient, and affordable surgical care in a rapidly changing healthcare economy. The overall message is that rising costs are forcing ASCs to adapt quickly or risk falling behind. The centers that will thrive are those that understand their data, optimize their resources, and remain agile in both leadership and strategy.
Alaa Abd-Elsayed, MD. Medical Director, UW Health Pain Services, UW Pain Clinic (Madison, WI): The rising costs of supplies and devices became a burden on all ASCs and in combination with the reduced reimbursement, the situation is becoming very challenging.
Lea Anne Abernathy. Administrator, Physicians Endoscopy Center at One Nineteen (Birmingham, AL): Rising device costs have placed added pressure on our ASC’s margins, particularly given the fixed reimbursement rates we operate under. We’ve had to evaluate purchasing practices carefully, standardize products where possible, and strengthen vendor negotiations to help control expenses. While these costs are challenging, our priority remains ensuring that patients continue to receive safe, high-quality GI care without disruption.
Harel Deutsch, MD. Co-Director, Rush Spine Center, Rush University Medical Center (Chicago): We have found device costs to be stable or minimally going up given the competitive landscape for many of the devices we use. Some devices that have tried to increase costs based on competitive advantages have sometimes changed what surgeries are feasible in the ASC setting.
Leslie Jebson. Administrator, Orthopedics and Sports Medicine Network, Prisma Health (Greenville, SC): Rapidly increasing device costs continue to pressure ASC profitability. Having a clear understanding of your case mix in comparison to your case costs and contracted reimbursement rates is the essential trifecta.
In many cases, lower cost device alternatives are not a realistic option. Therefore, knowing the appropriate surgical procedures costs by surgeon and anticipated reimbursement allows the ASC operator effective insights into understanding individual device cost increases.
The future of HOPD and retail ASC operations will inevitably include AI algorithms that overlay the EHR. The EHR will gauge the patient ASA and acuity, with the surgical procedure and historical payer rates.
Alex A. Andrade, Chief Operating Officer, Medical Associates P.C. Iowa (Dubuque): Escalating device expenses have made vendor selection a strategic priority. We’re partnering creatively with suppliers on rent-vs-buy models to manage capital outlay, protect margins, and support long-term ASC growth.
Pradnya Mitroo, MD. President, Fresno Digestive Health (Fresno, CA): Rising device costs have had a significant impact on our ASC operations. Endoscopy is inherently equipment-intensive — from single-use devices like snares, biopsy forceps, and hemostasis tools to high-capital items like scopes and processors. Over the past two years, we’ve seen year-over-year increases in device pricing anywhere from 8–15%, driven by supply chain pressures as well as manufacturer consolidation and inflation
These cost escalations affect us in three key ways:
- Case Economics & Margins
Many GI procedures are reimbursed at fixed ASC rates by Medicare and commercial payers, which don’t adjust for inflation in device costs. Rising per-case expenses erode margins, especially on lower-reimbursing procedures such as screening colonoscopies. What used to be predictable profitability is now much tighter, requiring careful case mix management. - Operational Decisions
We have to negotiate harder with vendors, seek bulk purchasing arrangements, and align with GPO contracts to offset inflation. We have trialed devices from different manufacturers and made physicians more aware of costs of the devices to have better physician engagement in this process. - Patient Access & Scheduling
When margins shrink, there’s downstream pressure to maximize block utilization and efficiency. Staffing and turnover must be optimized so that rising device costs don’t limit the number of cases we can accommodate. The ripple effect is real — device pricing influences everything from scheduling to staff overtime.
In short, rising device costs haven’t changed our commitment to high-quality, safe endoscopy, but they’ve forced us to become more strategic in purchasing, more efficient in operations, and more vigilant in preserving access for our Central California community.
Patty Shoults. Corporate Director Ambulatory Surgery, Ambulatory Surgery Centers, AdventHealth (Altamonte Springs, FL): Regarding rising device costs, reviewing our GP pricing and negotiated prices to make sure we are being charged the correct amount.
John Prunskis, MD, FIPP, Medical Director and Principal, DxTx Pain and Spine (Chicago): Rising device costs have compelled us to look closer at all our vendor contracts. With locations in 10 states we have buying negotiation opportunities.
It has also furthered our resolve that HOPD and ASC rates need to reach parity. ASCs are saving the health care system, including Medicare, so much money. Congress needs to act as soon as possible on payment parity between ASCs and hospitals for identical procedures to save Medicare and substantially reduce health care costs.
Paul Lynch, MD, DABA, Founder and CEO, US Pain Care (Scottsdale, AZ): Rising device costs have put real pressure on our ASCs, but we see it as an opportunity rather than just a challenge. Instead of simply absorbing these increases, we’re leveraging the moment to launch our own group purchasing organization and negotiate better pricing for our physician partners. Through volume-based contracts, we can create win-win partnerships with device companies while delivering greater value to our clients. At the end of the day, something has to give—and at U.S. Pain Care, we’re determined to make sure it isn’t patient care.
Elisa Auguste. Administrator, Precision Care Surgery Center (East Patchogue, NY): Rising costs have significantly affected our facility. While we have always accounted for expenses in our operations to ensure the delivery of high-quality, impartial care, the current environment requires us to pause and find creative strategies to control costs without compromising patient outcomes.
Unfortunately, we are operating in a time when reimbursement and expenses are increasing at very different rates, and we have limited control over either since much depends on payers and vendors. This reality makes it essential to continuously evaluate costs, implement thoughtful savings initiatives, and actively renegotiate with both payers and vendors.
As healthcare leaders, we must advocate for our patients and facilities—even when it means engaging in difficult conversations with stakeholders. Without strategic, proactive efforts, rising costs will erode operations and create long-lasting, potentially irreversible challenges.
Sherman Tran, MD, Managing Partner, Spine Sports Surgery Center LLC (Fremont, CA): Device costs have definitely gone up, and it puts a real squeeze on us since reimbursements haven’t really moved. It makes some cases a lot tighter on margin. We’ve had to push harder on vendor contracts, look at standardizing, and be smarter about what we use. Sometimes even long-time vendors sneak in price increases without telling us, so we’ve had to stay vigilant about checking billed rates against contracts and be more aggressive negotiating across vendors.
Mahesh Mulumudi, MD. Co-Founder and CEO, CardioNow (Lynnwood, Washington): Medical devices used in ambulatory surgery centers (ASCs), such as catheters, implants like stents, pacemakers, and joints can be quite expensive and can significantly increase the cost of operations. To manage these costs effectively, it is crucial to identify the optimal device features for each patient, consolidate vendors for these devices, and maximize participation in rebate programs. Often, we assume a one-size-fits-all approach for all patients, which is not the most resourceful or cost-effective strategy. Tailoring device selection to individual patient needs can help mitigate expenses.
Donna Hayden. Director, Supply Chain Operations, Surgical Center of DuPage Medical Group (Downers Grove, IL): To help counter the rising costs of surgical devices, we’ve increased savings projects in the indirect procurement arena. Most of the low hanging fruit in medical supplies have already been standardized, contracted and converted, so we need to think outside the box for savings. We have also changed GPOs for better pricing, administrative fees, rebates, etc. And we’re proactively working at lowering our inventory while ensuring cases are not affected.
Brett Maxfield. Director, Surgical and Anesthesia Services, Madison Avenue Surgery Center (Albany, NY): Rising costs have definitely affected the way we run our business. We’ve always tried to run a very efficient program, but this has forced us to be even more judicious in the way we order and use our supplies. It has also forced us to look very closely at all hardware that is being implanted during surgery. Unfortunately, the rising cost of hardware has necessitated that we look at different options, and in some case, that we have to send surgeries elsewhere because the reimbursement will no longer cover the cost of the implanted devices.
Wayne Franklin, MD. Senior Vice President, Heart and Lung Center, Children’s National (Washington, D.C.): These have affected everything and everybody, on the clinician side and the patient side. We try to mitigate this by using technology such as scheduling software that fills slots or can predict no-shows, and we are looking into getting AI that can help with prior authorizations and denials. We are also continuously looking at our supply chain to make sure we are optimizing contracts and maximizing delivery timeliness and efficiency. At Children’s National, part of my role as SVP is to foster better collaboration between the clinical team and the administrative team.
