Financial and regulatory tailwinds are boosting opportunities for ASC growth in the wake of recent policy proposals by CMS and other state-level legislative updates.
Certificate-of-need
CON has long been identified as barriers to growth by ASC leaders, especially those in independent practice. Proponents argue that the laws are an important regulation that keeps healthcare costs down. But others claim that the laws favor existing healthcare providers — often large hospitals, health systems and corporate entities — which stifles competition and growth.
However, three states are currently re-evaluating their CON laws. North Carolina plans to fully eliminate its certificate-of-need laws by January 2026. This planned repeal signals a major deregulation of healthcare facility development, particularly favorable for the growth of ASCs, imaging centers, and other outpatient services. In February 2025, New York state proposed significant amendments to its CON process aimed at easing regulatory burdens and modernizing cost benchmarks.
Both Tennessee and Georgia have also advanced reforms to scale back their CON requirements in the past year. Tennessee passed legislation that will scale back its CON program by 2025 through a phased program. Georgia has adopted incremental revisions, including raised spending thresholds and relaxed rules for certain rural projects, although it maintains its overall CON framework for now.
Recently, Alabama state Sen. Larry Stutts announced plans to file a bill during the next legislative session to reform certificate-of-need laws in the state. Mr. Stutts previously filed legislation aimed at limiting the authority of Alabama’s CON Review Board.
Procedure migration
On July 15, CMS released its proposed rules for 2026, which included the addition of nearly 300 new procedures to the covered procedures list for ASCs.
The proposal represents a significant future opportunity for ASCs. While the migration of these procedures will take place over the course of several years, the general shift toward outpatient care is likely to result in cost savings for patients, payers and providers.
“This expansion of ASC procedures represents one of the most significant single-year increases in ASC-eligible procedures. The ASC is becoming the facility that is positioned best for the future of outpatient surgery,” Amit Mirchandani, MD, medical director of Seva Pain & Wellness in Tulsa, Okla., told Becker’s. He added that if ASCs want to seize this opportunity, they will need to hone in on quality, safety and performance.
“By getting ahead of implementation timelines, as ASC leaders, we are collaborating to take action steps to align clinical teams, RCM teams and data points to model financial outcomes,” he said. “A safe transition to the ASC for higher acuity procedures will take place, especially in the field of cardiology and vascular surgery — and this will be a massive opportunity for those independent physicians in those specialties who are able to invest in independent facilities. There are always challenges, but the future looks bright for properly managed ASCs.”
Investment opportunities from big healthcare players
Hospitals, health systems and other corporate healthcare entities are increasingly investing in outpatient strategies as the cost-savings potential and elevated patient experience of ASCs makes them an increasingly attractive opportunity for growth.
A January survey of health system executives by VMG Health found that 60% of leaders were considering pursuing outpatient surgery joint ventures in 2024, the highest area of interest of any potential specialty partnerships. Additionally, Becker’s has reported on at least 13 hospitals and health systems investing in outpatient care so far in 2025.
This trend has begun transforming the once adversarial relationship between ASCs and hospitals.
“It’s not a ‘them versus us’ mentality anymore,” Karen Reiter, vice president of operations and payer management at Newport Beach, Calif.-based TriasMD and DISC Surgery Centers, told Becker’s. “This ongoing collaboration is a great thing to see and will take us where we want to go.”
The increased range and complexity of services ASCs offer have escalated the synergy between ASCs and hospitals, Ms. Reiter said.
Even for independent ASCs, hospital partnerships can present beneficial spinoffs, such as shared resources. Surgery centers and hospitals can also develop co-ownerships, such as partnerships with private equity or physician groups, Ms. Reiter said.
Support for independent practice
For those interested in maintaining an independent practice, there are numerous emerging strategies for partnership and consolidation that maintain ASC independence while tapping into the benefits of joint ventures with more well-resourced organizations.
Pelto Health Partners, launched three years ago, is a cross-state collaboration between three physician-owned orthopedic groups, aimed at supporting private practice sustainability. The group was formed to counteract the trend of small and midsized practices being pushed toward hospital employment or acquisition by private equity firms.
“We felt something needed to be done to keep independent groups independent, as many were being driven into hospital employment or selling to private equity,” Frank Aluisio, MD, of EmergeOrtho, who now serves as chair of Pelto’s board, told Becker’s. “Maintaining independence is important in prioritizing patients and the physician-patient relationship — not profits.”
Becker’s has reported on at least seven management services organizations and ASC development companies with similar goals and structures.
Hidden value in ASC real estate
As ASCs look for ways to improve liquidity, simplify ownership and increase valuation, sale-leaseback arrangements are becoming an increasingly attractive option.
Jon Vick, founding partner of ASCs Inc. and Vick & Co, told Becker’s that many ASC physicians and leaders may not even realize the value of their real estate.
“Every time a group of doctors builds a surgery center, they improve the property,” he said. “They’re paying themselves market-rate rent, which often is around $40 a square foot, so they’ve greatly increased the value of the property.”
In a sale-leaseback, an ASC sells its facility to a third-party investor or real estate investment trust and simultaneously signs a long-term lease, typically 12 to 15 years, to remain in the space. The ASC retains full operational control of the surgery business while offloading the burden of property ownership. The lease is usually structured as triple-net, Mr. Vick said, where the ASC maintains responsibility for property expenses but preserves long-term occupancy rights.
For physician-owned ASCs with equity in their real estate, sale-leasebacks can convert a non-liquid asset into cash. This liquidity can be used to pay off existing debt, buy out partners, fund expansion or technology upgrades, and build cash reserves, Mr. Vick said.
