Hospital consolidation may lead to higher costs of care and fewer choices for patients, but does present an opportunity for ASCs to provide a more cost-effective and efficient option.
These four healthcare leaders recently connected with Becker’s to discuss the potential effects of continuing consolidation throughout the industry on the delivery of spine surgery and spine care in the future.
Note: Responses were lightly edited for clarity and length.
Question: How do you anticipate hospital consolidation impacting spine care in the future?
Christopher Blanchard, DO. Orthopedic Spine Surgeon of Resurgens Orthopaedics (Cumming, Ga.): To answer the question, we must first understand why there is hospital consolidation. I have a great working relationship with my local hospital and do approximately 75% of my surgeries in the hospital. I think that most hospital consolidation is done to gain market share, power and profit. Hospital consolidation, including adding independent practices, leads to a funneling of patients into the specific healthcare system. We know that hospitals, with inpatient rates, charge and are reimbursed at higher rates than ambulatory surgical centers with no improvement in care metrics. Long term, I believe that continued consolidation of hospital systems will lead to higher cost of care and less patient choice.
Janet Carlson, MSN, RN. Vice President of ASC Operations of Commonwealth Pain & Spine (Louisville, Ky.): When healthcare systems consolidate, they employ more surgeons to align with their clinically integrated network. In doing so, these surgeons are then faced with pressure to conform to standardized practices of where they are given block time to perform surgery and what implants they are allowed to use based on which vendors are approved by the hospital value analysis committee. Recent studies have shown that consolidation leads to higher costs, reduced competition and more denials for surgeries. The dynamic to consider is the impact of hospital consolidation on accessibility, affordability and the quality-of-care options for patients. Those surgeons who want to remain independent are under tremendous pressure trying to work within the confines of the payers declining reimbursements along with increasing denials for care and the large hospital entities that dominate their local market. The opposite end of the healthcare system consolidation trend is the increasing migration of higher acuity spine surgeries to the ambulatory surgery setting. In my experience, ASCs are becoming the hub for spine specific surgical innovation with advancements in robotics, navigation and precision which leads to improved patient safety and shorter recovery times with each technological advancement.
Ali Ghalayini. ASC Administrator of Advanced Spine Center of Wisconsin (Neenah): As the U.S. healthcare landscape continues to evolve, hospital consolidation is emerging as a dominant trend and one with profound implications for spine care delivery. From the perspective of ambulatory surgery centers, this consolidation wave represents both a significant challenge and a unique strategic opportunity. With hospitals merging into large, integrated networks, ASCs must adapt to preserve their share of the spine care market and continue offering high-quality, cost-effective alternatives.
One of the most immediate consequences of hospital consolidation is the increased dominance of health systems and their ability to control referral networks. As hospitals acquire physician groups and consolidate services, spine referrals are more frequently kept in-house and directed to hospital outpatient departments. This limits access for independent ASCs, particularly those without formal affiliations or joint ventures with hospital systems. To remain competitive, ASCs must build stronger partnerships with independent spine surgeons and maintain robust relationships with referring providers.
While referrals may become more restricted, the migration of complex spine procedures to the outpatient setting presents a major opportunity. As payers and CMS expand the list of approved outpatient spine procedures, ASCs with the right clinical protocols and capabilities are well-positioned to take on this growing volume. Spine-focused ASCs that invest in equipment, overnight recovery capabilities and enhanced anesthesia protocols can safely manage 23-hour stays and more advanced procedures, offering a compelling value proposition to both payers and patients.
In parallel, health systems themselves may increasingly look to acquire or partner with high-performing ASCs as part of their broader outpatient growth strategy. For ASCs, this raises a critical decision point: remain independent and compete through agility and efficiency or consider strategic partnerships that enhance access to cases while potentially sacrificing some operational autonomy. In either scenario, demonstrating superior outcomes, financial transparency, and patient satisfaction will be key to sustaining long-term viability.
Finally, the rise in healthcare costs driven by consolidation may ultimately work in ASCs’ favor. As patients and employers become more cost-conscious, ASCs offer a transparent, lower-cost alternative to hospital-based care. Spine procedures, in particular, often carry a significant price difference between HOPDs and ASCs. By emphasizing affordability, convenience, and quality, ASCs can position themselves as the preferred site of service for spine care, even in a market increasingly dominated by consolidated health systems.
Carrie Spencer. COO of Texas Spine Care Center (San Antonio): Hospital consolidation continues to negatively impact every aspect of an independent physician practice providing spine care to our community. Health systems are focused on profits and not the overall well being of the patients seeking treatment. Hospital consolidation creates a closed network which prioritizes in-system referrals and dramatically impacts the ability of independent spine surgeons to receive patient referrals from specialists associated with the health system. Patients are forced into a system that they may not be happy with because there are limited specialist options available in the community. The cost of care rises as health systems have much more aggressive insurance contracts with higher reimbursement rates than independent practices. Independent physicians are left with suboptimal payer contracts and a continued decline in physician reimbursement rates that have not adjusted with inflation rates for decades. Health systems are often reimbursed three times the amount for a procedure or visit performed by a health system employed physician versus an independent physician. The cards are stacked against physicians that chose autonomy over salary.
