The ASC industry is entering a new era of growth, fueled by federal reimbursement changes and state-level deregulation.
Recent moves by the CMS and the rollback of certificate-of-need laws are reshaping where patients receive surgical care.
CMS moves
On July 15, CMS proposed a 2.6% increase in ASC payments for 2026 and announced a phased plan to remove hundreds of procedures from the inpatient-only list. The transition will begin with 285 procedures, largely musculoskeletal, phased out over three years. CMS will also continue exempting some procedures from medical review activities tied to the two-midnight rule.
“The most important factor is the ASC covered procedures list. By approving the outward migration of more complex spine and orthopedic surgeries to ASCs, CMS is accelerating the shift to more cost-effective settings,” Shakeel Ahmed, MD. CEO of St. Louis-based Atlas Surgical Group, told Becker’s. “CMS has already added more than 200 CPT codes this year, and I expect this trend to intensify. One urgent issue is payment updates — ASCs need inflation-adjusted reimbursement to remain sustainable as costs rise.”
For 2026, CMS has proposed revising the ASC Covered Procedures List, eliminating five general exclusion criteria and reframing them as nonbinding physician considerations for patient safety. This change would add 276 procedures to the list. Additionally, CMS plans to move another 271 procedures from the IPO list to the ASC setting in 2026.
“CMS adding more than 500 procedures to the ASC covered procedures list — including 271 codes being removed from the inpatient-only list — will drive serious growth to ASCs over the next five years,” William Vanderveer. CEO of Matawan, N.J.-based Redefine Management, told Becker’s.
Certificate-of-need updates
At the state level, certificate-of-need laws, long criticized by ASC leaders, are being scaled back or eliminated. These laws, which require state approval to expand or build healthcare facilities, have historically limited ASC growth.
Alabama state Sen. Larry Stutts has announced plans to file legislation to reform CON laws in the upcoming session. He argues the current process is too costly and burdensome, noting that he has worked with healthcare groups to shape reform efforts.
Meanwhile, North Carolina is moving toward a full repeal of its CON laws by January 2026. In the interim, as of Nov. 1, 2023, ASCs in counties with populations over 125,000 no longer require CON approval. This phased approach has already opened the door for expansion in high-demand regions. Experts suggest that the regulatory shift will intensify competition across the state’s healthcare market.
“This may vary region by region,” said Richard Saver, a professor of law at the University of North Carolina at Chapel Hill who also works in the university’s social medicine, medical, and public health departments. “In highly competitive markets like the Research Triangle or other parts of the state, major health systems will continue to compete with one another. If CON is overturned, it could create competitive pressure to lower barriers to entry.”
Other states are taking similar steps. In February, New York proposed raising capital expenditure thresholds in its CON process. Under the plan, the threshold for general hospitals would increase from $15 million to $30 million, and for ASCs and clinics, from $6 million to $8 million, a move aimed at easing regulatory burdens and modernizing cost benchmarks.
