Restrictions on Medicaid reimbursement and the ongoing anesthesiologist shortage have been among the most pressing issues facing ambulatory surgery centers (ASCs) across the U.S. in 2024.

Representatives from several state ASC associations discussed those and other topics during a recent virtual panel discussion. 

“By joining together and just always viewing ourselves as community, I think we really do have to take that on ourselves, especially as the leaders of these organizations, to really make ourselves available to people who are new in the industry and people that are starting out and growing,” Jeffrey Flynn, president of the New York State Association of Ambulatory Surgery Centers, said during the panel.

Still, there have been victories for the ASC sector as well – both big and small. 

In New York, for example, Gov. Kathy Hochul is actively engaged with the ASC community, recognizing centers as critical health care access points, Flynn said.

“We have a governor who actually is in favor of shifting that to us, and we’re in the process of meeting with the New York State Health Department,” Flynn said. “For the first time ever, we’re really being recognized, so that we can be part of her solution.”

Challenges and solutions

But even the ASC sector in New York faces challenges, including restrictions on Medicaid reimbursements and regulations limiting the use of credit card information for medical debt recovery.

New surgery centers often wait up to two years for a Medicaid number, which delays their ability to serve Medicaid patients, Flynn said. This delay can jeopardize their five-year license renewals, despite meeting charity care requirements. 

“Centers are actually being deferred their five-year license because this council comes back and says, ‘Well, you didn’t do Medicaid for the first three years,’ and it was like, ‘But we exceeded our charity care because you didn’t give us a number to begin with,’” Flynn said. “So that’s finally being brought to the governor, who is actually asking the health department, ‘Why does it take so long?'”

In Texas, several legislative bills, including those addressing price transparency and artificial intelligence in health care, have been filed. One bill proposes that ASCs must absorb cost discrepancies of more than 5% between pre-surgical estimates and actual charges.

“The devil in the details is that if you give a patient a cost estimate, at the end, when they are billed, if the variance is greater than 5% than what you estimated, you’re on the hook, not the patient,” Krista Durapau, executive director of the Texas ASC Society, said during the panel discussion. “And you cannot try to collect that difference of greater than 5%. The goal is to try to get patients accurate estimates, although everybody knows things change day to day, and that’s going to be really hard to fit that 5% window.”

Additionally, the state is exploring ways to alleviate regulatory burdens on inspections and implement innovative strategies to tackle nursing shortages.

“There is discussion about inspections for certain equipment in ASCs and all health care facilities, reducing the burden and regulation around those,” Durapau said. “A couple of interesting [bills focus on] waste reduction for pharmaceutical bills that are being filed. And then, of course, workforce pipelines, nursing shortages, clinical hours, preceptorships, and trying to get the nursing workforce up and running.”

In Massachusetts, price transparency is a major focus, with the state passing its own bill simultaneously with the federal No Surprises Act, Ronna Wallace of the Massachusetts ASC Association said during the panel.

However, the two laws have conflicting requirements, creating challenges for operators. Massachusetts is working to delay state implementation until the federal law is fully in effect to avoid confusion, Wallace said. 

“If you had a contract with a management service organization or you had private equity money in your facility, you would have to disclose it, but it wouldn’t be prohibited,” she said. “We just wanted that gone. And it looks like we’re getting our wish because I do not believe the legislation will move forward in this session.”

The anesthesiologist shortage emerged as a common theme across all states. Some New York centers have been forced to close operating rooms due to shortages, while Texas physicians are increasingly scheduling surgeries on weekends to accommodate limited anesthesia availability.

“Lots of creative things that people are doing right now to get the cases done, even if it is on a Saturday or Sunday,” Durapau said. “It’s about when they can get the anesthesia providers there.” 

In Massachusetts, insurers are refusing to cover anesthesia costs for certain procedures, exacerbating the problem, Wallace said. 

“Some of the insurers have stopped paying, particularly for gastroenterology, for propofol, and will only pay for the conscious sedation,” she said. “So that’s the only anesthesiology issue that I’m familiar with at this point that we’ve dealt with here, and it hasn’t been a regulatory thing or a legislative thing. It’s been a contractual thing, mostly with Blue Cross Blue Shield.”

Creative staffing strategies, stipends for anesthesiologists and leveraging Certified Registered Nurse Anesthetists (CRNAs) were some of the solutions discussed, though using CRNAs has met resistance in states that require physician supervision.

“The problem is that what we’re finding when we talked about that, because that was one of the partial solutions we were discussing, is that when surveying a number of our doctors throughout our centers, the surgeons weren’t comfortable with supervising the anesthesiologist,” Flynn said. “That was where we kind of hit a brick wall because there was a pretty sizable number who said they’re just not comfortable doing it during their case. They’re there to do their part of the surgery.”