Image by Mildred Rios from PixabayGLP-1s and Medicare Advantage (MA) are two potential headwinds for ambulatory surgery centers (ASCs), with each undoubtedly playing a larger role in 2025.
Partly because of this increasingly prominent standing, the U.S. Centers for Medicare & Medicaid Service (CMS) proposed new policies related to both GLP-1s, or glucagon-like peptide-1s, and MA on Nov. 26.
“This proposed rule includes more policies to remove unnecessary barriers to care stemming from the use of inappropriate prior authorization by clarifying requirements for plan use of internal coverage criteria and proposing guardrails for the use of artificial intelligence (AI) to protect access to health services,” CMS wrote in a corresponding fact sheet. “It would also expand access to transformative anti-obesity medications under the Medicare Part D and Medicaid programs, helping to ensure more Americans have access to these medications.”
GLP-1s are a type of medication that has become popular in the treatment of obesity. These drugs have shown significant success in weight loss, and CMS is seeking to expand access for Medicare beneficiaries.
Traditionally, CMS has excluded drugs primarily used for weight loss from coverage.
“However, CMS has re-evaluated the exclusion and considered changes in the prevailing medical consensus towards recognizing obesity as a disease and the increasing prevalence of obesity in the U.S. population generally, and in the Medicare population more specifically,” the agency’s fact sheet explains.
The change would impact both the Medicare and Medicaid programs.
While GLP-1s have surged in popularity, they pose possible challenges for ASCs. As more of these weight-loss medications are prescribed, the types of patients requiring surgeries, along with the procedures they’re undergoing, could shift.
ASCs that specialize in or derive revenue from bariatric procedures, for instance, could see fewer patients opting for surgical interventions. Additionally, if Medicare beneficiaries are living at healthier weights, they could experience better heart health, in turn needing cardiovascular procedures less frequently.
At the same time, healthier lifestyles may lead to more rigorous physical activity and, in turn, more orthopedic procedures.
ASC leaders have regularly had to field questions about GLP-1s throughout much of 2023 and 2024.
“While we do not know the ultimate impact of these drugs, it is believed that such drugs will lead to fewer co-morbidities in a healthier, more active lifestyle, which generally bodes well for our short-stay surgical facilities,” Eric Evans, the CEO of Surgery Partners Inc. (Nasdaq: SGRY), said during his company’s 2023 third-quarter earnings call.
On the Medicare Advantage front, CMS in its Nov. 26 proposed rule said it is seeking to eliminate red tape, particularly around prior authorization. The agency also wants to put into place guardrails around AI.
MA has become a bigger slice of the ASC reimbursement pie as enrollment figures have risen.
About 32.8 million people were enrolled in a Medicare Advantage plan in 2024, according to Kaiser Family Foundation statistics. That’s more than half of the eligible Medicare population.
But MA plans often reimburse ASCs at lower rates compared to traditional Medicare, with MA payers able to negotiate their rates and significantly undercut fee-for-service pricing. What’s more, MA plans frequently require pre-authorization for procedures, adding delays and paperwork for ASC staff.
And with greater frequency in recent years, claims are denied outright.
In its fact sheet, CMS specifically noted that regulators want to “remove barriers that delay care or deny people services and medications they need to be healthy.”
“Key proposals include defining the meaning of ‘internal coverage criteria’ to clarify when MA plans can apply utilization management, ensuring plan internal coverage policies are transparent and readily available to the public, ensuring plans are making enrollees aware of appeals rights, and addressing after-the-fact overturns that can impact payment, including for rural hospitals,” a CMS announcement detailed.
CMS is additionally seeking to gather more information on the MA plan decision-making process, such as when prior authorization is required or why claims are denied in certain circumstances.
On average, MA plans overturn 80% of their decisions to deny claims when those claims are appealed to the plan, according to CMS.
As for AI, payers have begun using AI-powered algorithms to review and deny claims. This practice has led to multiple lawsuits in 2023 and 2024.
Broadly, CMS wants to adjust rules and regulations to better ensure “AI does not result in equitable treatment, bias, or both, within the health care system.”
