The number of ASCs in Florida and Texas have grown rapidly in the past five years due to an increased demand for elective surgery and a favorable regulatory environment.
Last year, Florida added 28 ASCs and Texas added 23. Metropolitan areas in both states are becoming saturated with surgery centers, so physician owners and future developers are looking eagerly at a few new emerging markets with huge potential for growth.
North and South Carolina
The environment in both Carolinas is ripe for an ASC explosion over the next few years. Both have a growing population as former city dwellers flocked to the region during the pandemic, when workers went fully remote, as a destination that offered some comforts of city life in addition to a variety of outdoor activities.
Neither state is saturated with surgery centers either due to certificate of need laws. North Carolina has 1.32 ASCs per capita after adding nine last year, and South Carolina has 1.41 ASCs per capita with the addition of two centers in 2021. Hospitals have a history of challenging new surgery centers or expansions in the state, but the tides could be turning.
The South Carolina Senate voted to eliminate its certificate of need program in January and sent the bill to the House. Last October, North Carolina Court of Appeals Judge Richard Dietz questioned the basic premise of the state's certificate of need law during oral arguments in an ASC case. North Carolina also issued more favorable decisions for ASCs, approving multiple expansions and new centers last year.
New York
The Big Apple is quietly preparing for a shift in the healthcare landscape. For years, New York was considered one of the most challenging states for new ASCs, and even the nation's biggest chains stayed away. The market was so challenging that it had just around 0.82 ASCs per capita in 2021.
However, insurers in the state are changing the game by directing more patients to ASCs for outpatient surgery. Last year, Empire BlueCross BlueShield in New York updated its coverage policy for several outpatient procedures, requiring medical necessity reviews if surgeons want to perform the cases in a hospital outpatient department instead of an ASC. The payer's goal is to drive more members to lower-cost ASCs.
New York has certificate of need laws that have been restrictive in the past, but the pandemic highlighted the need for more hospital alternatives. Last year, New York added at least 19 ASCs. The only states to add more centers in 2021 were, of course, Texas and Florida.