The U.S. Centers for Medicare & Medicaid Services (CMS) is delaying the implementation of its five-year prior-authorization demonstration for ambulatory surgery centers (ASCs).
Originally, the prior-auth demo was set to go live in December 2025 across all participating states: California, Florida, Texas, Arizona, Ohio, Tennessee, Pennsylvania, Maryland, Georgia and New York. Now, the demo will be rolled out in two phases.
ASCs in California, Florida, Tennessee, Pennsylvania, Maryland, Georgia and New York can submit prior-authorization requests beginning on Jan. 5, 2026, for dates of service on or after Jan. 19, 2026, according to CMS. Those in the remaining states can submit beginning on Feb. 2, 2026, for dates of service on or after Feb. 16, 2026.
The Ambulatory Surgery Center Association (ASCA) had asked CMS to consider a delay in October, partly due to the government shutdown and its ongoing ripple effects.
“ASCA has concerns with the demonstration project in general, but especially in light of the government shutdown, we do not believe that the Medicare Administrative Contractors (MAC) are equipped to handle the new prior authorization requests,” ASCA wrote to CMS.
This isn’t the first time such a project from CMS has been delayed.
Broadly, CMS’ prior-authorization and pre-claim review demonstrations have been criticized as inconsistent, confusing and operationally messy, often creating administrative burdens without clearly improving program integrity.
Demos in the past have been launched with lofty goals – such as reducing improper payments or standardizing medical review – but undermined by shifting timelines, unclear guidance and abrupt policy pivots. What’s more, providers in other parts of health care have described the demonstrations as moving targets.
The home health Review Choice Demonstration (RCD) saga illustrates the pattern.
CMS initially proposed the program as the Pre-Claim Review Demonstration (PCRD) in 2016, sparking immediate pushback due to fears of excessive denials and administrative overload. After rolling out in Illinois, CMS abruptly paused and delayed the expansion amid complaints and operational problems, then canceled the program entirely, only to later revive it in 2018 under a new name with modified options for agencies to choose from.
Even after revival, implementation was staggered, delayed again due to the pandemic and marked by inconsistent contractor performance.
The rollout was such a mess U.S. Sen. Marco Rubio (R-Fla.) even got involved at one point.
“We support efforts to combat Medicare fraud and protect taxpayer funds, but we are concerned that the PCRD’s current parameters are too broad to reduce fraud and improper payment rates,” a 2017 letter from Rubio and other lawmakers to CMS emphasized.
Among other concerns with the ASC prior-auth demo, ASCA has pointed out that its focus may be off target from the get-go.
“Of the 41 codes included in the demonstration project, there are only eight codes for which nationwide volume exceeded 900 claims in 2023,” ASCA’s letter explained. “Twenty-four of the codes CMS proposes for this demonstration had fewer than 100 claims nationwide in 2023. Five of those codes (15847, 36474, 36476, 36479 and 36483) have a payment indicator N1, meaning they are not separately payable in the ASC setting. Since they do not receive reimbursement, it does not make sense to include them in a prior authorization demonstration.”
