Healthcare is in the middle of a structural shift, one that is being driven as much by policy as by technology, cost pressures, and patient expectations. Few areas illustrate this more clearly than ambulatory surgery. What started as a fringe concept more than 50 years ago has become one of the most powerful forces reshaping where and how care is delivered today.
Why This Conversation Matters
The Architecture of Healing was created to be more than a podcast, it’s a platform for real-time dialogue across healthcare strategy, operations, and the built environment. Too often, these conversations happen in silos or only surface at conferences once or twice a year. Meanwhile, policy, reimbursement, and care delivery continue to evolve at a pace that demands faster learning and shared understanding.
Ambulatory surgery centers sit at the intersection of all of these forces. They are not simply a reimbursement mechanism or a real estate play. They represent a fundamental rethinking of site of care, patient experience, operational efficiency, and long-term facility strategy.
A Brief History of Ambulatory Surgery Centers
The first ambulatory surgery center opened in 1970, driven by a desire to provide safer, more affordable outpatient alternatives to inpatient procedures. What followed was rapid growth:
- By the late 1970s, dozens of ASCs were operating across the U.S.
- By the late 1980s, that number exceeded 1,000, supported by Medicare reimbursement models that remain largely intact today.
- By the early 2000s, thousands of ASCs were performing millions of procedures annually.
- Today, more than 5,000 ASCs deliver tens of millions of surgeries each year.
This growth didn’t happen by accident. It was enabled by standards, accreditation, reimbursement, and advancements in clinical techniques that made outpatient surgery safer and more efficient.
The Inpatient-Only List and the 2026 CMS Rule
In 2000, CMS introduced the inpatient-only (IPO) list to identify procedures deemed too complex or risky for outpatient settings. For years, this list served as a clear boundary between inpatient and outpatient surgery.
That boundary is now dissolving.
With the 2026 CMS rule, hundreds of procedures are being removed from the inpatient-only list, with CMS signaling its intent to fully eliminate the list by 2028. This follows a stop-and-start pattern over the past several years, including the removal and partial reinstatement of procedures amid safety and operational concerns.
The implications are significant:
- More procedures are shifting to outpatient and ASC settings
- Hospitals face increasing pressure to justify inpatient stays
- Payers are less willing to reimburse higher-cost sites of care
- Documentation, safety protocols, and care pathways become even more critical
This is not just a policy update, it’s a catalyst for structural change.
What This Means for Hospitals
As more care moves out of the hospital, the role of the hospital itself is changing. In many ways, the hospital of the future is becoming more focused, more acute, and more specialized.
At its core, that hospital increasingly centers on three functions:
- Emergency care
- Intensive care
- Complex surgery
Many services that once lived comfortably within hospital walls are now better suited for outpatient environments. This shift reduces demand for certain inpatient spaces while increasing demand for highly flexible, highly specialized surgical environments.
For health systems, this raises difficult but necessary questions:
- Which services truly belong in the hospital?
- Where does outpatient care create greater value?
- How do facilities evolve without overbuilding or underutilizing space?
Designing for Flexibility, Not Certainty
One of the most important lessons from the rise of ASCs is that flexibility matters more than prediction. Policy will continue to change. Technology will continue to evolve. Care models will continue to shift.
Designing rigid environments based on today’s rules is a recipe for obsolescence.
Instead, organizations should be thinking about:
- Hybrid models that allow surgical space to flex between inpatient and outpatient use
- Co-located ASCs that maintain proximity to hospital resources while operating independently
- Infrastructure that supports future acuity changes without wholesale renovation
In one recent project, an ASC was fully co-located within a hospital but operated as a distinct entity, designed to flex operating rooms between hospital and ASC use as demand shifts over time. Models like this acknowledge uncertainty and build adaptability into the physical environment.
Beyond Reimbursement: Strategy, Alignment, and Care Delivery
While reimbursement often drives these conversations, it shouldn’t be the only factor. Decisions about ASCs also affect:
- Physician alignment and recruitment
- Staffing models and workforce sustainability
- Patient access and experience
- Long-term master planning and capital deployment
In some cases, higher-acuity procedures may technically be eligible for outpatient reimbursement, but clinical, operational, or alignment considerations still point toward hospital-based care. Strategy requires nuance, not absolutes.
Looking Ahead
The removal of the inpatient-only list is not the end of the story, it’s the beginning of a new chapter. As outpatient surgery continues to expand, healthcare leaders, designers, and planners must deepen their understanding of how policy translates into space, workflow, and experience.
If we want to design environments that truly support healing, we can’t treat buildings as static objects. They are strategic assets shaped by regulation, operations, and the evolving needs of patients and clinicians alike.
That is the work ahead.
And it’s exactly the kind of conversation this platform was created to support.
If you’re navigating ASC growth, hospital strategy, or outpatient expansion within your organization, I’d love to hear what you’re seeing. These shifts are happening everywhere—and we all get better by learning from one another.
