Ambulatory surgery centers (ASCs) are thriving as a cost-effective alternative to traditional hospital-based surgeries and offering patients a more convenient and efficient setting for procedures. However, managing an ASC comes with its own set of revenue-related challenges.
These facilities often run on tight margins due to lower reimbursement rates compared to hospitals, bundled payments that limit billing flexibility, and the need to balance competitive pricing with rising operational costs. These financial constraints require ASC leaders to carefully navigate operational complexities and find innovative ways to stay competitive.
Rising operational costs and an increasing rate of denied claims further intensify the pressure, making it critical for ASCs to adopt proactive measures if they want to maintain financial stability and continue delivering high-quality care in 2025.
Here are four approaches ASCs can focus on to optimize operations and sustain profitability in the upcoming year.
Stay Out of the Danger Zone (120–180 Days in Aged Receivables)
Because ASCs operate on narrow profit margins, cash flow is critical, making aged receivables more than just a financial inconvenience—they’re a serious threat to operational stability. Claims that go unpaid for more than 120 days enter the “danger zone,” where reimbursement becomes significantly less likely. By 180 days, recovery is nearly impossible.
Delayed payments ripple across the organization, affecting payroll, vendor payments, and the ability to invest in new equipment or services. Physician-owned ASCs also feel the pressure, as unpaid claims delay distributions and undermine morale. Staff may find themselves chasing “old money,” which is labor intensive and can increase costs if the work is outsourced to third-party agencies.
Effective receivables management starts with recognizing that the first 90 days post-procedure are critical. Claims aging beyond that point require additional resources to recover, reducing efficiency and straining resources. Staying proactive—by identifying discrepancies early, ensuring accurate coding, and following up swiftly—can help ASCs avoid falling into the danger zone.
Expect Higher Scrutiny from Payers
In recent years, payers have intensified their scrutiny of ASC claims, making compliance and adaptability more important than ever.
Even straightforward procedures can result in complex billing challenges. For instance, a routine screening colonoscopy may turn into a diagnostic procedure if a problem is detected, leading to coding changes and potential claim denials.
Payers’ increasing reliance on audits and stricter rules around authorizations further complicate matters. Some procedures require pre-authorization, but real-time changes in the operating room—such as shifting from a minimally invasive to an open approach—can necessitate retroactive approvals. Additionally, payers sometimes implement random audits or hold claims to verify compliance with their rules, which delays payments and creates operational bottlenecks.
To mitigate these risks, ASCs must ensure transparency at every step of the revenue cycle, including maintaining clear communication with patients about potential out-of-pocket costs and being prepared to address discrepancies that arise during coding and billing. Staying informed about payer trends and anticipating potential challenges can prevent disruptions and keep cash flow steady.
Avoid the Mentality That Hiring More People Fixes the Problem
When revenue cycle challenges arise, it’s easy to assume that hiring additional staff will solve the problem. However, more hands on deck doesn’t always translate to better results. In fact, this approach often compounds inefficiencies without addressing the root causes.
In reality, many issues stem from systemic failures in workflows or technology. Staff can only work as effectively as the systems in place allow. Additionally, labor costs are already one of the largest line items on an ASC’s profit and loss statement, and increasing headcount can strain tight budgets further.
Instead, ASCs should prioritize optimizing existing processes with automation and intelligent systems. Addressing inefficiencies with technology ensures that staff can focus on high-value tasks without being bogged down by repetitive manual processes.
Protect Your Lean Margins with Automation and Machine Learning
Given the ASC industry’s tight margins and little room for error, automation and machine learning (ML) have become critical tools for staying competitive.
However, it’s important to note that automation and ML aren’t about replacing people. Instead, they empower staff to focus on patient care and strategic decision-making by handling repetitive, time-consuming tasks.
These technologies start with early-stage processes like insurance verification and prior authorizations. Integrating systems that can check coverage instantly and flag discrepancies helps ASCs eliminate the need for repetitive manual tasks.
Such tools are especially critical during periods like Medicare open enrollment when insurance changes can disrupt claims if not identified promptly. Additionally, automation ensures claims are scrubbed for errors before submission, reducing denials and accelerating payment cycles.
ML takes automation a step further as they can analyze historical claims data and predict potential issues before they occur. For example, if a procedure typically involves an implant but none is documented, the system can flag the discrepancy and prompt staff to verify the operative report. In the same way, ML identifies patterns in payer behavior, empowering ASCs to adjust claims proactively to meet anticipated requirements and prevent denials altogether.
Denial management is another area where ML proves invaluable. Some payers send generic denial notices followed by detailed correspondence with instructions. But, when you can teach a system to read and interpret these letters, it significantly reduces the need for human intervention and expedites the resolution process.
Protect Your ASC’s RCM in 2025
Want to ensure your ASC stays ahead in 2025? Explore how our end-to-end RCM services and solutions can simplify your workflows, reduce denials, and protect your bottom line.
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