Revision hip and knee replacements, long considered too complex, risky and expensive to move out of hospitals, are now entering a new frontier: ASCs for Medicare patients.
A federal Medicare payment rule that took effect Jan. 1 expanded the procedures eligible for reimbursement in ASCs, pushing more complex orthopedic cases into outpatient settings. The change reflects how far outpatient joint replacement has evolved, but it also raises the stakes for surgery centers now expected to manage cases that can swing from straightforward to highly complex.
“These were the last procedures we were not able to do at an ambulatory surgery center,” Craig Della Valle, MD, chief of adult reconstructive surgery at Chicago-based Rush University Medical Center, said. “If you had asked most people, myself included, five years ago, seven years ago, certainly 10 years ago, it would have been almost laughable.”
Dr. Della Valle said surgeons have become more comfortable operating in ASCs and more skilled at running them. With improved perioperative protocols and more outpatient experience, he believes many “simple” revision procedures can be done safely in a freestanding center, but only if facilities approach the work with discipline around cost, staffing and patient selection.
A long-impossible move becomes realistic
Revision joint replacement is often discussed as a single service line, but Dr. Della Valle described it as a wide spectrum. Some procedures are narrowly defined and predictable. Others can become lengthy operations that require complex reconstruction and expensive implants.
Unlike primary joint replacement, revision patients arrive with scar tissue and existing implants, and surgeons may need to remove hardware before rebuilding the joint with new components.
“Patients already had surgery, so there’s going to be scarring,” he said. “If they’ve got a failed implant, depending on exactly what it is, you may be taking out implants, which isn’t easy, and then putting in new implants. The bone is distorted.”
Dr. Della Valle said that variability is what has historically kept revisions in hospitals. Primary hips and knees, he said, have become routine outpatient procedures for many surgeons comfortable in ASCs, but revisions carry a much wider “bell curve” of complexity.
As outpatient care has advanced, he said, the calculus has changed.
“As we’ve gotten more comfortable operating in an ASC and better at it, and our protocols have gotten better, I think it is reasonable to do many simple revisions at an ambulatory surgery center,” he said.
He added that he has become more aggressive in his own practice, particularly when it comes to revision knees, though he emphasized that not every revision case is appropriate for an outpatient center.
“I personally have gotten a little bit more aggressive, particularly with my knee revisions,” he said. “I feel like I could probably do most of my knee revisions at an ambulatory surgery center.”
Implant costs and reimbursement drive the business case
Even when a revision is clinically appropriate for outpatient care, Dr. Della Valle said the economics can be unforgiving. Implant costs can quickly outpace reimbursement, turning a case into a loss for the facility.
“You have to carefully look at the price of the implants you’re going to use and what your proposed reimbursement is,” he said. “It will be very easy to overspend on your implants and spend more than you’re going to get reimbursed for the case.”
That margin pressure matters more in ASCs, where reimbursement is generally lower than in hospitals, he said. It also intersects with a broader debate in orthopedics: which tools and technologies actually provide value.
Dr. Della Valle said surgeons often want products because they prefer them, not because strong evidence shows they improve outcomes. Surgery centers must be willing to confront that dynamic if they want revision procedures to be sustainable outpatient.
Cost control is not an abstract exercise. ASCs are businesses, and a center that consistently loses money on surgeon preference cannot survive.
“You can’t run a business that loses money. It goes bankrupt,” he said.
A procedure type built for outpatient care
Because revision procedures range widely in difficulty, Dr. Della Valle said ASCs should start with cases that are more controlled, more predictable and less likely to require high-cost implant constructs.
Research his group presented at the American Association of Hip and Knee Surgeons pointed to one category as particularly well-suited for outpatient care.
“Modular liner or bearing surface exchanges for both hips and knees looked like ideal cases to do at an ambulatory surgery center,” he said.
Those procedures involve swapping modular parts, the bearing surfaces designed to be replaced, rather than removing a full implant construct. Dr. Della Valle said that typically means lower implant costs, simplified surgical steps and less blood loss, making the cases a logical starting point for Medicare revision procedures in ASCs.
The change is already altering what some centers can offer.
“Three weeks ago, we couldn’t do those at our ambulatory surgery center,” he said. “Now we can.”
While those cases may not represent massive volume, he said they create a new avenue for growth, especially for physician-owned centers or those backed by management companies.
“If you own your ambulatory surgery center, you’re always looking to grow,” he said.
Readiness depends on aligned leadership and surgeon engagement
Dr. Della Valle said the centers best positioned to take on revision procedures will be those with engaged surgeon partners and hands-on leadership, administrators who understand what is being booked, what resources are required and what the implant construct will cost.
He said ASC leaders should take an active role when a revision case is booked, including sitting down with the surgeon to understand the procedure, ensuring the right tools are available and reviewing implant pricing against reimbursement.
In some situations, he said, leaders may need to tell surgeons that certain tool choices make a case inappropriate for the outpatient setting.
Physicians, profit and the hospital pressure point
Dr. Della Valle argued ASCs succeed for two reasons. “They are viable businesses that make money, and they do a really good job of taking care of patients, arguably a better job,” he said.
Discomfort around physicians making money has shaped policy decisions, including restrictions on physician-owned hospitals, he added. “Doctors should be allowed to make money,” he said, pushing back on the assumption that profit motive drives inappropriate surgery. He said he does not believe the evidence supports that concern.
Instead, he said physician leadership can produce stronger value. “Physician leadership in surgical facilities leads to higher quality of care and better value,” he said.
Dr. Della Valle said the economics of outpatient revision procedures benefit multiple stakeholders. Because hospitals are generally reimbursed more than ASCs for the same procedures, insurers and Medicare can save money when cases are done safely in outpatient settings.
“The insurers save money, the patients save money and the doctors make more money,” he said. “The only one that loses is the conventional hospital.”
He added that hospitals often underestimate how much leverage surgeons have when they are not employed. Surgeons, he said, are effectively customers of surgical facilities.
“If a surgical facility, whether it be a conventional hospital or an ASC, wants that surgeon’s business, they need to earn it,” he said, “and they need to earn it by partnering with that physician to help them provide best quality care for their patients.”
At the same time, he said many tertiary hospitals remain full, and shifting lower-acuity cases out of main operating rooms can help them focus on complex care.
He described the difficulty of transferring a patient for tertiary-level care because of capacity constraints.
“It took us a couple days to transfer a patient into Rush because Rush was full,” he said.
Early data shows promise, with a warning
Dr. Della Valle said early evidence suggests certain revision procedures can be performed safely in freestanding ASCs, with some early data pointing to lower complication risk for modular bearing surface exchanges compared with hospital settings.
He said the economics only hold if safety holds. Readmissions and complications are expensive, and a high readmission rate can erase any savings achieved by moving cases into lower-cost settings.
“If you’re readmitting 1 in 5 patients, that’s not going to lead to dollar savings,” he said. “If it’s 1 in 20, you probably have a winner.”
Dr. Della Valle added that continued monitoring and research will be essential as revision cases shift outpatient.
“Studies have shown this is possible and it’s safe, but we need more data and more experience,” he said.
He emphasized that safety must remain the priority.
“It requires careful surveillance and continued research to make sure patient safety is paramount,” he added.
Preparing for what comes next
With revision procedures now in play for Medicare patients in ASCs, Dr. Della Valle said the next phase will come down to whether facilities can execute on the details that determine success: selecting the right revision cases, ensuring the center has the tools and staffing to support them, and keeping implant spend aligned with reimbursement.
The shift may expand outpatient opportunity, but it will also expose weak infrastructure quickly, separating centers that can scale revisions safely and sustainably from those that are not yet ready.
