In a healthcare landscape defined by rapid change, orthopedic practice owners face a high-stakes balancing act: meeting the growing demand for outpatient surgery, embracing new technologies, navigating reimbursement headwinds — all while preserving independence.
During a podcast interview at the 22nd Annual Spine, Orthopedic and Pain Management-Driven ASC + The Future of Spine Conference, Dr. Scott Hannum, partner at Emerge Ortho and president and medical director at Brunswick Surgery Center in Wilmington, N.C., shared his perspective on how independent orthopedic groups can thrive amid these pressures.
Now in his 27th year of practice, Dr. Hannum oversees one of North Carolina’s busiest physician-owned surgery centers and is helping lead Emerge Ortho’s effort to scale collaboration nationally without ceding control to hospitals or private equity. His message to peers: Growth is essential — but independence is worth protecting.
Here are key takeaways from the conversation.
- Scaling through partnership, not acquisition
Emerge Ortho was formed eight years ago through the consolidation of several North Carolina-based orthopedic practices, including groups in Wilmington, Raleigh, Greensboro, Winston-Salem and Asheville. Today, it is among the largest independent orthopedic practices in the country — and it’s not stopping there.
“Our biggest driver is how do we partner with other like-minded independent orthopedic groups around the country,” Dr. Hannum said, adding, “How do we come together to maintain independent practices, collectively improve contracts with payers and suppliers, and provide better healthcare coverage and benefits for our employees?”
To that end, Emerge Ortho is a founding member of PELTO — a national consortium of independent orthopedic groups aligned on clinical quality, payer advocacy and group purchasing strategies. Practices in the consortium span the West Coast, Midwest, Northeast and Southeast.
“In order to stay competitive and deal with the rapid changes in healthcare economics, we feel that it’s very important to have a different model than being owned by a healthcare system or being owned by a university system, which has benefits, but also has a lot of red tape and a lot of complexities,” said Dr. Hannum. “Our biggest growth driver in the next three to five years is how do we make that work and expand hopefully nationwide.”
For orthopedic practice owners, PELTO represents a middle path: scale without surrender. It also reflects a growing realization that solo independence is no longer sustainable — but collective independence might be.
- The outpatient shift is real — and it’s stressing ASC capacity
The movement of orthopedic surgeries from hospital settings to ambulatory surgery centers has been building for years. COVID-19 only hastened the trend, pushing procedures out of hospitals and permanently resetting patient expectations.
“There’s no question that we can safely and successfully do 70 to 80 percent of most, if not all, orthopedic surgeries at ASCs,” Dr. Hannum said. “That’s a good and a bad problem. It’s good for patients; patient care is better. The outcomes are better. The risk of infections are lower. But we don’t have the facilities to do that many surgeries, and there’s a lot of regulations in many states in the country about opening ASCs, who can own them, how fast you can build them.”
That mismatch between demand and infrastructure is a major challenge, especially in states where certificate of need laws and ownership restrictions limit ASC development. While many physicians see this as a growth opportunity, the logistical and regulatory hurdles remain significant.
- Unequal reimbursement is hurting ASC viability
One of the most frustrating dynamics for ASC leaders is reimbursement disparity. Dr. Hannum noted that federal payment rates still favor hospital-based settings, even when ASCs provide identical — or better — surgical care.
“The federal government, unfortunately, does not reimburse surgeries to be done at an ASC at the same rate that they do at a hospital or even an outpatient hospital setting, which is inappropriate,” he said. “It’s the same surgery, it’s the same care. If anything, we’re more efficient and we’re cheaper — with better outcomes. There is a huge lobbying effort that has to be done on the national level, which is not easy.”
For orthopedic practices that own and operate ASCs, this creates a structural disadvantage. While commercial payers may offer better rates, the gap in Medicare and Medicaid reimbursement remains a major concern — particularly for centers serving older or more complex patient populations.
Dr. Hannum called for a more concerted national effort to advocate for payment parity and push back against outdated assumptions about site-of-service value.
- Technology, when done right, is a force multiplier
Despite the financial and regulatory friction, Dr. Hannum expressed cautious optimism about the role of technology — especially artificial intelligence and robotic surgery — in improving efficiency and care quality.
“We’re seeing [AI] incrementally in the way we document cases, the way we do patient visits, operative notes, billing and collection,” he said, adding, “Even just the technology that we have with the surgery, with robotic surgery and other things — that’s very exciting.”
Still, he warned that the hype often outpaces the substance.
“Everybody wants to talk about AI and what AI is doing, and 90% of people don’t even know what it is, but they want to talk about it,” he said.
For practice owners, this means being deliberate: investing in tools that streamline operations, improve documentation and support billing accuracy — not just buying into buzzwords.
- The future belongs to agile, mission-aligned practices
As Dr. Hannum looks to the second half of 2025 and beyond, his focus is on strategic growth and operational efficiency — not for its own sake, but to preserve what matters most. The alignment between independent orthopedic practices can support surgeons in business growth and providing better patient care.
“The real question is: How do we preserve autonomy while still evolving?” he said. “We can’t do it alone. But we also don’t have to give everything away.”
