On This Page On This Page How to Start an Ambulatory Surgery Center (ASC) Written by: Bill Warren If you’re a physician who’s considering opening their own ambulatory surgery center (ASC), you’re in good company. MCG Health reports that, of the 5,800 ASCs on record in the U.S. in 2023, 95% were at least partially physician owned and 52% were solely physician owned. The incentives for physicians are clear: ASCs offer greater autonomy than traditional hospital outpatient departments (HOPDs), allowing physicians to perform a smaller variety of specialized procedures. This selectivity translates to greater efficiency and productivity without compromising on quality of care, as well as lower overhead costs, enabling physicians to retain a larger percentage of profits and even pass cost-savings on to their patients. Speaking of patients, a growing number are turning to ASCs over HOPDs for outpatient procedures, citing lower costs, greater convenience, and higher quality care as motivating factors. According to one study from the Leapfrog Group, patients rated ASCs more favorably than HOPDs across all patient experience domains, including staff and facilities, communication, overall facility ratings, and willingness to recommend. The potential benefits of building an ambulatory surgery center are certainly compelling. In this article, we’ll offer a step-by-step guide on how to start an ambulatory surgery center, including legal considerations, design options, licensing, and much more. Step 0: Feasibility Analysis Before you can begin the formal process of building an ambulatory surgery center, you must first determine whether the project is financially viable. Begin your feasibility analysis by conducting in-depth research to gauge local market demand, understand population demographics within your target market, and assess competitor performance. From there, you’ll want to put together revenue projections for your new facility. To do so: Create a list of the services and procedures your ASC will offer, Estimate the total number of each type of procedure you anticipate performing on an annual basis, and Determine reimbursement rates for each procedure from Medicare, Medicaid, and private insurers. The Centers for Medicare & Medicaid Services (CMS) assigns each outpatient procedure to an Ambulatory Patient Classification (APC) payment group. These payment groups are organized based on shared clinical characteristics and estimated resource usage and are designed to standardize reimbursement rates for different procedures across ASCs. The CMS assigns a Healthcare Common Procedure Coding System (HCPCS) code to each APC group, which sets the reimbursement rate for procedures in that group. This rate is a fixed cost, which the CMS reevaluates and updates annually. Once you’ve put together revenue projections, calculate the initial investment required to open your ASC. This estimate should include various cost components, including site development, construction, licensing fees, equipment, staffing and training, IT infrastructure, and initial operating expenses. While your capital investment will vary depending on the size and scope of the project, industry estimates place the startup cost for building a new ambulatory surgery center between $2 million and $8 million. When evaluating startup costs, you’ll also want to consider how you intend to finance your ASC; there are multiple options available, including loans, equity financing, and grants. Finally, your feasibility analysis should include a break-even analysis that determines the number of procedures you’ll need to perform each month to cover operating expenses and recover your initial investment. Taken as a whole, market research, revenue projections, capital investment calculations, and break-even analysis will enable you to make an informed decision about whether to open an ASC and, if the numbers make sense, to engage in strategic financial planning throughout every stage of development. Step 1: Legal Considerations Whether you’re interested in acquiring and renovating an existing ASC or building a brand-new facility, it’s imperative that you research legal and regulatory requirements and obtain all of the necessary paperwork — starting with building permits. A building permit verifies that your proposed project complies with all applicable zoning laws, building codes, safety and environmental regulations. Most authorities, regardless of jurisdiction, will require you to submit detailed project plans and specifications for approval in order to receive a building permit. Many states also require healthcare providers to obtain a certificate of need (CON) before establishing a new healthcare facility or expanding an existing one. A CON is exactly what it sounds like: A legal document that demonstrates the necessity of your facility and explains how the surrounding community will benefit from its services. The CON program was first introduced in the 1960s in an effort to control rising healthcare costs, prevent duplicate services, and maintain a high standard of patient care. At present, 35 states and Washington, D.C. have CON programs in place; requirements to obtain a CON vary from one jurisdiction to another. Physicians looking to start an ASC — rather than expand upon their existing practice — may also need to form a legal entity, such as a limited liability company or corporation, to provide a legal and financial structure for their facility. Once all of the foundational pieces are in place for your ASC, the next step is to obtain the necessary state licenses to operate it. Each state has specific requirements, which generally include meeting health department standards, passing a series of inspections, demonstrating compliance with healthcare regulations, and paying licensing fees. Beyond state-specific requirements, ASCs must adhere to several federal regulations to be eligible for Medicare and Medicaid reimbursement and to comply with broad healthcare standards. These regulations include: The CMS’s Conditions for Coverage and Conditions of Participation The Health Insurance Portability and Accountability Act The No Surprises Act The 21st Century Cures Act At this stage of the process, you’ll want to work closely with an attorney to ensure you have a complete understanding of all legal requirements and have done your due diligence to meet them. Although accreditation doesn’t come until later in the process, it’s also worth engaging with accrediting organizations at this stage to understand their requirements and integrate their standards into your planning and operations. Step 2: Property Acquisition With all legal considerations and paperwork accounted for, you’re ready to move on to site selection and property acquisition. This can be an exciting step of the ASC development process, as it enables you to envision what your future facility might look like. You have a few potential options here: You can purchase an existing ASC and renovate it, acquire an existing building and convert into an ASC, or purchase a plot of land and build your ASC from the ground up. Focusing first on the option to renovate or convert, there are a few things to consider when viewing potential properties, including: Structural Integrity and Condition: Ensure the building has a solid foundation and is free from major structural issues, such as cracks, water damage, or mold. These issues can be costly to repair and could impact the safety of your ASC. You’ll also want to inspect the condition of the roof, walls, and exterior finishes, looking for signs of wear and tear that might indicate future repair needs. Interior Layout and Space: It’s important that the layout of the building can be easily modified to accommodate your ambulatory surgery center’s floor plans, including operating rooms (ORs), pre-op and post-op areas, sterile processing department (SPDs), administrative offices, waiting rooms, and so on. Each room within the facility should have enough square footage to comfortably accommodate personnel, patients, and equipment. Ceilings should be high enough to install essential equipment and ensure proper lighting and ventilation. Plumbing, Electrical, and HVAC Systems: Check the existing plumbing systems to ensure they’re adequate and consider whether they can support the increased demand of an ASC. You’ll also want to verify that the facility’s electrical system can handle the high power demands of medical equipment. Upgrading these systems can be costly, so existing capacity is a key consideration. Finally, proper ventilation and climate control are crucial in an ASC, so you’ll want to determine whether the current HVAC system is capable of supporting sterile conditions in ORs and your SPD. Accessibility and Safety: Your ASC should be accessible to all patients, including those with disabilities. When touring properties, note whether they have existing ramps, elevators, and ADA-compliant restrooms, or if you’ll need to modify the ASC’s layout to incorporate these. From a safety perspective, adequate fire safety measures, including alarms, sprinklers, and clearly identified fire exits, are essential. Make sure each property you view meets local fire codes and regulations. Zoning and Permits: Though you’ll have secured a building permit for your new ASC by this point, you’ll still want to confirm that any properties you view are zoned for medical use and that previous renovations were completed with the necessary permits. Doing your due diligence will reduce your risk of running into unresolved building code violations or other restrictions that might prevent you from converting the property into an ASC. Location: You’ll want to locate your ASC somewhere central and convenient for patients, staff, and suppliers. Consider the proximity of prospective properties to major roadways and assess the availability of public transportation to ensure that your facility is accessible to a broader patient base. The building itself should be visible and easily identifiable, with space for adequate signage. Potential for Expansion: There may come a time in the future when you want to expand your ASC. It’s best to take a forward-thinking approach when viewing properties and consider whether there’s room for expansion either within the building (in the form of unfinished basements or attic space) or on the property (such as adjacent land or parking lot space). Purchasing a plot of land and choosing to build new comes with many of the same considerations as acquiring an existing property, such as location, accessibility, zoning and permits, and future growth potential. There are, however, a few additional considerations that should factor into your decision when looking at available land: Site Infrastructure: Check the availability and capacity of essential utilities such as water, sewer, electricity, gas, and high-speed internet, confirming that these services can support the demands of a busy healthcare facility. You’ll also want to assess whether the site has direct access to public roads; there may be a need for additional infrastructure such as turn lanes or traffic signals to facilitate safe entry and exit. Size and Topography: Determine whether the plot is large enough to accommodate the building’s footprint, parking, landscaping, and any future expansion plans, making sure to account for required setbacks and buffer zones. You’ll want to prioritize sites with relatively flat terrain to minimize grading and excavation costs and to evaluate the soil quality and stability, as poor soil conditions can lead to higher construction costs. Environmental and Site Conditions: Conduct environmental assessments to identify any potential issues such as contamination, protected species habitats, or wetlands. Addressing these issues early can prevent costly delays. You’ll also need to evaluate the site’s drainage capabilities and flood risk, ensuring proper drainage systems are in place or can be developed to prevent water damage and meet local regulatory requirements. Long-term Development: Investigate local government development plans to confirm that there are no planned infrastructure or zoning changes that could negatively impact your site. Whether you’re touring existing buildings or plots of land, it’s in your best interest to have a team of professionals on site with you to offer real-time guidance. Depending on what types of properties you intend to view, your team might include any of the following: Your architect, your broker, a civil engineer, an environmental professional, a general contractor, a surveyor, a local government representation, your attorney, and/or other key stakeholders in the project. Step 3: Equipment Planning As a prospective ASC owner, it’s your responsibility to determine what equipment you’ll need for your facility; this equipment will inform both the design requirements and overall budget of your project. Unless you have prior experience working directly with suppliers, it’s in your best interest to retain the services of a procurement specialist. When vetting potential procurement specialists, look for one who: Specializes in healthcare facility setup (particularly ASCs) Holds certifications such as the Association for Supply Chain Management’s Supply Chain Procurement Certificate Is a member of professional associations such as the Association for Health Care Resource & Materials Management or the Ambulatory Surgery Center Association The full list of equipment you’ll need when building an ambulatory surgery center is extensive and includes: Category Equipment Operating Room Equipment Operating tables Surgical lights Anesthesia machines and monitors Electrosurgical units Surgical instruments and trays Suction units Endoscopy towers and scopes Pre-op and Post-op Equipment Patient beds and stretchers Vital sign monitors Infusion pumps Defibrillators and emergency crash carts Imaging and Diagnostic Equipment Ultrasound machines X-ray machines MRI or CT scanners Laboratory Equipment Basic lab analyzers Refrigerators for specimen storage Sterile Processing Department Equipment Washers-disinfectors Ultrasonic cleaners Sinks and workstations for manual cleaning Drying cabinets Steam sterilizers (autoclaves) Low-temperature sterilizers Sterilization containers, wraps, and pouches Sterile storage racks and cabinets Case carts Transport trolleys Biological and chemical indicators Sterility assurance monitoring systems Administrative and Office Equipment Computers and servers Office furniture (e.g. desks, chairs, filing cabinets) Telecommunication systems Billing and scheduling software Facility Support Equipment HVAC systems Generators Backup generators Medical gas systems Waste management systems Step 4: Design & Development To build an ambulatory surgery center that is functional, efficient, and welcoming, you’ll need to work with qualified architects and engineers who specialize in designing and developing healthcare facilities. The Healthcare Design Directory, professional associations such as the American College of Healthcare Architects and the American Society for Healthcare Engineering, and industry conferences and tradeshows can all be helpful places to start your search. Additionally, connecting with colleagues and seeking recommendations from established ASCs can lead to valuable referrals. When designing your ASC’s layout, be sure to allocate space for all essential workflows. In addition to operating rooms, which will be the core of your facility, you’ll need: A reception/check-in area and waiting room Consultation rooms where physicians can meet with patients before or after procedures A laboratory for on-site testing needs A sterile processing department for cleaning, sterilizing, and storing surgical instruments Preoperative and postoperative areas designated for patient preparation and recovery Storage areas for medical supplies, equipment, and medications Staff areas, including break rooms and administrative offices It’s important that these spaces be designed with patients, physicians, or both parties in mind. For patients and their families, the goal is to create a calm environment where they can recover from their procedure or wait for their loved ones. Spacious waiting areas with comfortable, soothing color schemes, natural lighting, artwork, and easy navigation with clear signage can all create a more inviting atmosphere. Accessibility features such as ramps, wide corridors, and ADA-compliant restrooms ensure inclusivity for all patients, while private recovery rooms offer a quiet space for patients to rest post-surgery. For physicians, the focus is developing a space that enables them to efficiently deliver high-quality care. This includes well-planned OR layouts that reduce unnecessary movement, ergonomic workstations, easily accessible equipment storage, and dedicated areas for physicians to consult with patients and collaborate with colleagues. Some additional tips when designing your ASC: Ensure pre-op, OR, and post-op areas are logically arranged to allow seamless transitions between different stages of care. Create distinct pathways for patient movement and supply transport to prevent cross-contamination and enhance efficiency. Position nurses centrally within patient care areas for easy monitoring and fast response times. Install hand hygiene stations at strategic locations throughout the facility, including the entrance to every room. Use materials and finishes that are durable, non-porous, and easy to clean. Utilize sound-proofing materials to reduce noise levels in post-op areas, ensuring a calm environment for recovering patients. Consider using modular design elements that can be easily reconfigured as your facility’s needs change. Design rooms that can serve multiple purposes, such as consultation rooms that can double as minor procedure rooms if needed. Invest in robust IT infrastructure to support electronic health record storage, telemedicine, and other digital healthcare solutions. Ensure that staff workstations are located near high-traffic areas to reduce time spent walking between tasks. By incorporating these principles, you can design an ASC layout that supports efficient operations while prioritizing the highest standards of patient care. Step 5: Project Bids Blueprints in hand, you’re ready to start soliciting and evaluating project bids from contractors for the construction of your facility. This typically involves working with stakeholders to compile a comprehensive request for proposal (RFP) that outlines the project’s scope, specifications, timeline, and budget. With the help of your architect, engineer, and procurement specialist, you’ll need to distribute your RFP to a list of reputable contractors with prior experience in healthcare construction. When evaluating incoming bids, be sure to consider the following: Does the proposal address all of the requirements listed in your RFP? Does the proposal answer all of the questions included in your RFP? Does the proposal include a detailed breakdown of anticipated costs for labor, materials, equipment, and any subcontracted work? Does the proposed timeline for the project align with your expectations? Does the proposal set clear milestones for project phases, so you can easily track the progress of the project? What are the reputations of any subcontractors or suppliers mentioned in the proposal? Does the proposal clearly explain how the contractor plans to manage and coordinate subcontractors and suppliers to ensure seamless project execution? Does the proposal account for healthcare industry regulations and local, state, and federal requirements? Does the proposal list all of the members of the contractor’s project management team, including their qualifications, experience, and roles? Does the proposal set clear expectations for communications and reporting throughout the project? Does the proposal include contingency plans should issues arise during construction? Is the contractor willing and able to provide references from past clients? Step 6: Equipment Selection & Acquisition While it’s important to plan out your equipment needs early on in the process, you’ll want to select and order your equipment closer to when construction actually starts to avoid potential issues with storage and changes in project specifications. Similar to contractors, you’ll want to carefully evaluate different equipment vendors, as well as the various makes and models for different pieces of equipment, to make informed purchasing decisions. Some key factors to consider during the equipment selection and acquisition process include: What is the manufacturer’s reputation? Are they a well-established company with a history of producing reliable medical equipment? Are there any product reviews or testimonials from other healthcare professionals about the vendor or the particular product? Is the vendor willing and able to provide references for past customers? Does the equipment come with a comprehensive warranty? Does the vendor offer different financing options for their products such as leasing, installment plans, or deferred payment options? Does the manufacturer meet the Food and Drug Administration’s regulations for medical device manufacturing or ISO standards? Is the equipment compatible with the IT infrastructure and software systems you’ve chosen for your facility? How user-friendly is the equipment? Does the vendor offer staff training programs? How responsive is the vendor’s customer service team, and do they offer multiple forms of support? Does the vendor offer maintenance services, either directly or through a third-party provider? Does the vendor have a spare parts program? Can the vendor provide information about the environmental impact of their manufacturing process, or their equipments’ energy consumption? Step 7: Construction With all of the pieces in place, it’s time to transform your architectural plans into a functional facility. While the construction phase of the ASC development process is fairly straightforward — contractors and subcontractors will begin building or renovating your facility — there are still a few things you can do to navigate this stage successfully, including: Establish clear communication channels. This includes holding regular meetings with project stakeholders to discuss progress, assess any issues, and make necessary adjustments. Keep detailed minutes of these meetings to ensure accountability and track decisions made throughout the project. Keep a close eye on your project timeline. Your contractor’s proposal should have included a project timeline inclusive of all major phases of construction, from initial site preparation to final inspections. Regularly compare the actual progress of your project against this planned timeline to identify and promptly address any deviations. Your contractor should have contingency plans in place for potential delays caused by unforeseen circumstances such as weather conditions or supply chain disruptions. Carefully manage your budget to avoid cost overruns. This involves tracking expenditures, approving change orders, and confirming that any additional costs are justified and documented. It’s also beneficial to establish a contingency fund to cover unexpected expenses that may arise during construction. Plan ahead for equipment installation. Your contractor and procurement specialist should work closely together to schedule equipment deliveries and installations at appropriate stages of construction so that the installation process does not interfere with ongoing work and that equipment is properly integrated within your ASC’s infrastructure.In addition to supervising installation, your procurement specialist should: Verify that all equipment is properly connected to power and utility systems Conduct functional, performance, and safety testing Perform final calibrations Compile all equipment documentation, including operational manuals and warranties, to prepare for handover Conduct final inspections and testing. Before your ASC can open, it must pass a series of final inspections to ensure that everything is up to code and functioning correctly. This includes testing all electrical, plumbing, and HVAC systems, as well as verifying the proper installation of equipment. Once testing is complete, conduct a thorough walkthrough with your construction team, architect, engineer, and project manager to create a punch list of any remaining tasks or corrections needed. You’ll need to address these issues promptly to avoid delays in obtaining permits and final certifications. Step 8: Accreditation, Certification, & Licensure Before your new ambulatory surgery center can open to the public, there are three key things you’ll need to obtain: State licensure, Medicare certification, and accreditation. State Licensure At present, 43 states require ASCs to obtain licensure before opening. Licensure requirements vary by state, so you’ll want to consult your state’s health department or relevant regulatory body before proceeding. Most states require you to submit an application with detailed information about your facility, undergo multiple inspections to ensure your facility meets the required standards, and submit records and documentation — including policies and procedures, staff credentials, and emergency plans — for review. Medicare Certification To receive reimbursement from Medicare and Medicaid, your ASC must be certified by the CMS. According to the Ambulatory Surgery Center Association (ASCA), to obtain Medicare certification, ASCs must: Obtain a National Provider Identifier from the National Plan and Provider Enumeration System Enroll in Medicare through either the online Provider Enrollment, Chain and Ownership System or by mailing a completed 855b form to your state’s Medicare Administrative Contractor Demonstrate that your facility meets the CMS’s Conditions for Coverage Either obtain accreditation from an approved organization or agree to be surveyed by their state’s Medicare agency Accreditation While not mandatory, accreditation from recognized bodies such as the Joint Commission, the Accreditation Association for Ambulatory Health Care, the Accreditation Commission for Health Care, or QUAD A can enhance your facility’s reputation, ensure compliance with industry, and support Medicare certification. Each accrediting organization has its own standards and practices, so you’ll want to select one that aligns with your facility’s goals and practices. Once you’ve chosen an accrediting body, you’ll need to: Provide comprehensive details about your ASC’s operations, staffing, and patient protocols, Conduct a self-assessment based on the accrediting body’s standards, Undergo an on-site survey, and Maintain continuous compliance. Step 9: Staffing & Training The final — and perhaps most critical — step in the ASC development process is to find and train a team of highly qualified surgeons, physicians, nurses, technicians, and other personnel to work in your facility. When assembling your team, look for surgeons and physicians with board certification in their respective specialties and a proven track record in performing the types of procedures your ASC will offer. Nurses should have significant experience in perioperative cares, while technicians should be proficient in operating and maintaining surgical equipment. Your team will need to undergo comprehensive training to align with your ASC’s policies and procedures, starting with an orientation program that covers your facility’s missions, values, and patient care philosophy. Initial training should also include detailed information on safety protocols, infection control procedures, and emergency response plans. Ensuring that every team member understands these foundational aspects is vital to creating a safe and effective care environment. You’ll also need to provide specialized training on the operation of various equipment. Given the complexity and precision required in surgical settings, it’s imperative that all staff members be proficient in using your ASC’s equipment. Arrange for hands-on training sessions with equipment vendors or certified trainers to ensure that every staff member is comfortable and skilled in using the technology at their disposal. You can further reinforce training and foster a culture of continuous learning and improvement by providing access to additional workshops, seminars, and certification programs and by scheduling routine training updates and refresher courses. — As a physician, opening your own ambulatory surgery center can be a rewarding experience, not only in terms of financial gain, but also in delivering positive patient outcomes and supporting your community. For additional guidance, we encourage you to explore the ASCA’s full catalog of resources — and, when you’re ready to build your ASC, consider adding Consolidated Sterilizer Systems to your list of equipment vendors. Our healthcare autoclaves are built to last the test of time and can be custom-configured to suit any ASC layout, and our team of specialists are able to provide on-site installation support and equipment training. Start your search for the right sterilizer today with our healthcare autoclave buyer’s guide. Sources: MCG Health, “The Role of Ambulatory Surgical Centers, https://www.mcg.com/blog/2023/08/17/ambulatory-surgical-centers/.” Journal of Spine Surgery, “Ambulatory surgery center ownership models, https://www.ncbi.nlm.nih.gov/pmc/articles/PMC6790806/.” The Leapfrog Group, “Part One: Outpatient Surgical Care: Patient Experience at Ambulatory Surgery Centers (ASCs) and Hospital Outpatient Departments (HOPDs), https://www.leapfroggroup.org/sites/default/files/Files/Patient%20Experience%20Report_OASCAHPS_Final.pdf.” Centers for Medicare & Medicaid Services, “Hospital Outpatient Prospective Payment System (OPPS), https://www.cms.gov/cms-guide-medical-technology-companies-and-other-interested-parties/payment/opps.” Centers for Medicare & Medicaid Services, “Healthcare Common Procedure Coding System (HCPCS), https://www.cms.gov/medicare/coding-billing/healthcare-common-procedure-system.” Surgery Center Consultants, “Costs of Developing an Ambulatory Surgery Center, https://surgerycenterconsultant.com/costs-of-developing-an-ambulatory-surgery-center/.” National Conference of State Legislature, “Certificate of Need State Laws, https://www.ncsl.org/health/certificate-of-need-state-laws.” Centers for Medicare & Medicaid Services, “Conditions for Coverage (CfCs) & Conditions of Participation (CoPs), https://www.cms.gov/medicare/health-safety-standards/conditions-coverage-participation.” Ambulatory Surgery Center Association, “HIPAA Resources, https://www.ascassociation.org/asca/asc-operations/regulations/hipaa-resources.” American Medical Association, “Implementation of the No Surprises Act, https://www.ama-assn.org/health-care-advocacy/access-care/implementation-no-surprises-act.” Ambulatory Surgery Center Association, “Cures Act Final Rule, https://www.ascassociation.org/asca/asc-operations/regulations/cures-act-final-rule.” Samuels Group, “On Shaky Ground – Addressing Unsuitable Soils in Construction, https://www.samuelsgroup.net/blog/addressing-unsuitable-soils-in-construction.” Consolidated Sterilizer Systems, “4 Key Impacts of Sterile Processing in Hospitals and ASCs, https://consteril.com/sterile-processing-department-hospital/.” Ambulatory Surgery Center Association, “Medicare Certification Resources, https://www.ascassociation.org/asca/medicare/certification.” 17 Questions to Ask Before Buying Your Next Autoclave We created this 17-question eBook as a framework to help you explore and discover the exact type of autoclave best suited to your needs. 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How to Start an Ambulatory Surgery Center (ASC) Written by: Bill Warren If you’re a physician who’s considering opening their own ambulatory surgery center (ASC), you’re in good company. MCG Health reports that, of the 5,800 ASCs on record in the U.S. in 2023, 95% were at least partially physician owned and 52% were solely physician owned. The incentives for physicians are clear: ASCs offer greater autonomy than traditional hospital outpatient departments (HOPDs), allowing physicians to perform a smaller variety of specialized procedures. This selectivity translates to greater efficiency and productivity without compromising on quality of care, as well as lower overhead costs, enabling physicians to retain a larger percentage of profits and even pass cost-savings on to their patients. Speaking of patients, a growing number are turning to ASCs over HOPDs for outpatient procedures, citing lower costs, greater convenience, and higher quality care as motivating factors. According to one study from the Leapfrog Group, patients rated ASCs more favorably than HOPDs across all patient experience domains, including staff and facilities, communication, overall facility ratings, and willingness to recommend. The potential benefits of building an ambulatory surgery center are certainly compelling. In this article, we’ll offer a step-by-step guide on how to start an ambulatory surgery center, including legal considerations, design options, licensing, and much more. Step 0: Feasibility Analysis Before you can begin the formal process of building an ambulatory surgery center, you must first determine whether the project is financially viable. Begin your feasibility analysis by conducting in-depth research to gauge local market demand, understand population demographics within your target market, and assess competitor performance. From there, you’ll want to put together revenue projections for your new facility. To do so: Create a list of the services and procedures your ASC will offer, Estimate the total number of each type of procedure you anticipate performing on an annual basis, and Determine reimbursement rates for each procedure from Medicare, Medicaid, and private insurers. The Centers for Medicare & Medicaid Services (CMS) assigns each outpatient procedure to an Ambulatory Patient Classification (APC) payment group. These payment groups are organized based on shared clinical characteristics and estimated resource usage and are designed to standardize reimbursement rates for different procedures across ASCs. The CMS assigns a Healthcare Common Procedure Coding System (HCPCS) code to each APC group, which sets the reimbursement rate for procedures in that group. This rate is a fixed cost, which the CMS reevaluates and updates annually. Once you’ve put together revenue projections, calculate the initial investment required to open your ASC. This estimate should include various cost components, including site development, construction, licensing fees, equipment, staffing and training, IT infrastructure, and initial operating expenses. While your capital investment will vary depending on the size and scope of the project, industry estimates place the startup cost for building a new ambulatory surgery center between $2 million and $8 million. When evaluating startup costs, you’ll also want to consider how you intend to finance your ASC; there are multiple options available, including loans, equity financing, and grants. Finally, your feasibility analysis should include a break-even analysis that determines the number of procedures you’ll need to perform each month to cover operating expenses and recover your initial investment. Taken as a whole, market research, revenue projections, capital investment calculations, and break-even analysis will enable you to make an informed decision about whether to open an ASC and, if the numbers make sense, to engage in strategic financial planning throughout every stage of development. Step 1: Legal Considerations Whether you’re interested in acquiring and renovating an existing ASC or building a brand-new facility, it’s imperative that you research legal and regulatory requirements and obtain all of the necessary paperwork — starting with building permits. A building permit verifies that your proposed project complies with all applicable zoning laws, building codes, safety and environmental regulations. Most authorities, regardless of jurisdiction, will require you to submit detailed project plans and specifications for approval in order to receive a building permit. Many states also require healthcare providers to obtain a certificate of need (CON) before establishing a new healthcare facility or expanding an existing one. A CON is exactly what it sounds like: A legal document that demonstrates the necessity of your facility and explains how the surrounding community will benefit from its services. The CON program was first introduced in the 1960s in an effort to control rising healthcare costs, prevent duplicate services, and maintain a high standard of patient care. At present, 35 states and Washington, D.C. have CON programs in place; requirements to obtain a CON vary from one jurisdiction to another. Physicians looking to start an ASC — rather than expand upon their existing practice — may also need to form a legal entity, such as a limited liability company or corporation, to provide a legal and financial structure for their facility. Once all of the foundational pieces are in place for your ASC, the next step is to obtain the necessary state licenses to operate it. Each state has specific requirements, which generally include meeting health department standards, passing a series of inspections, demonstrating compliance with healthcare regulations, and paying licensing fees. Beyond state-specific requirements, ASCs must adhere to several federal regulations to be eligible for Medicare and Medicaid reimbursement and to comply with broad healthcare standards. These regulations include: The CMS’s Conditions for Coverage and Conditions of Participation The Health Insurance Portability and Accountability Act The No Surprises Act The 21st Century Cures Act At this stage of the process, you’ll want to work closely with an attorney to ensure you have a complete understanding of all legal requirements and have done your due diligence to meet them. Although accreditation doesn’t come until later in the process, it’s also worth engaging with accrediting organizations at this stage to understand their requirements and integrate their standards into your planning and operations. Step 2: Property Acquisition With all legal considerations and paperwork accounted for, you’re ready to move on to site selection and property acquisition. This can be an exciting step of the ASC development process, as it enables you to envision what your future facility might look like. You have a few potential options here: You can purchase an existing ASC and renovate it, acquire an existing building and convert into an ASC, or purchase a plot of land and build your ASC from the ground up. Focusing first on the option to renovate or convert, there are a few things to consider when viewing potential properties, including: Structural Integrity and Condition: Ensure the building has a solid foundation and is free from major structural issues, such as cracks, water damage, or mold. These issues can be costly to repair and could impact the safety of your ASC. You’ll also want to inspect the condition of the roof, walls, and exterior finishes, looking for signs of wear and tear that might indicate future repair needs. Interior Layout and Space: It’s important that the layout of the building can be easily modified to accommodate your ambulatory surgery center’s floor plans, including operating rooms (ORs), pre-op and post-op areas, sterile processing department (SPDs), administrative offices, waiting rooms, and so on. Each room within the facility should have enough square footage to comfortably accommodate personnel, patients, and equipment. Ceilings should be high enough to install essential equipment and ensure proper lighting and ventilation. Plumbing, Electrical, and HVAC Systems: Check the existing plumbing systems to ensure they’re adequate and consider whether they can support the increased demand of an ASC. You’ll also want to verify that the facility’s electrical system can handle the high power demands of medical equipment. Upgrading these systems can be costly, so existing capacity is a key consideration. Finally, proper ventilation and climate control are crucial in an ASC, so you’ll want to determine whether the current HVAC system is capable of supporting sterile conditions in ORs and your SPD. Accessibility and Safety: Your ASC should be accessible to all patients, including those with disabilities. When touring properties, note whether they have existing ramps, elevators, and ADA-compliant restrooms, or if you’ll need to modify the ASC’s layout to incorporate these. From a safety perspective, adequate fire safety measures, including alarms, sprinklers, and clearly identified fire exits, are essential. Make sure each property you view meets local fire codes and regulations. Zoning and Permits: Though you’ll have secured a building permit for your new ASC by this point, you’ll still want to confirm that any properties you view are zoned for medical use and that previous renovations were completed with the necessary permits. Doing your due diligence will reduce your risk of running into unresolved building code violations or other restrictions that might prevent you from converting the property into an ASC. Location: You’ll want to locate your ASC somewhere central and convenient for patients, staff, and suppliers. Consider the proximity of prospective properties to major roadways and assess the availability of public transportation to ensure that your facility is accessible to a broader patient base. The building itself should be visible and easily identifiable, with space for adequate signage. Potential for Expansion: There may come a time in the future when you want to expand your ASC. It’s best to take a forward-thinking approach when viewing properties and consider whether there’s room for expansion either within the building (in the form of unfinished basements or attic space) or on the property (such as adjacent land or parking lot space). Purchasing a plot of land and choosing to build new comes with many of the same considerations as acquiring an existing property, such as location, accessibility, zoning and permits, and future growth potential. There are, however, a few additional considerations that should factor into your decision when looking at available land: Site Infrastructure: Check the availability and capacity of essential utilities such as water, sewer, electricity, gas, and high-speed internet, confirming that these services can support the demands of a busy healthcare facility. You’ll also want to assess whether the site has direct access to public roads; there may be a need for additional infrastructure such as turn lanes or traffic signals to facilitate safe entry and exit. Size and Topography: Determine whether the plot is large enough to accommodate the building’s footprint, parking, landscaping, and any future expansion plans, making sure to account for required setbacks and buffer zones. You’ll want to prioritize sites with relatively flat terrain to minimize grading and excavation costs and to evaluate the soil quality and stability, as poor soil conditions can lead to higher construction costs. Environmental and Site Conditions: Conduct environmental assessments to identify any potential issues such as contamination, protected species habitats, or wetlands. Addressing these issues early can prevent costly delays. You’ll also need to evaluate the site’s drainage capabilities and flood risk, ensuring proper drainage systems are in place or can be developed to prevent water damage and meet local regulatory requirements. Long-term Development: Investigate local government development plans to confirm that there are no planned infrastructure or zoning changes that could negatively impact your site. Whether you’re touring existing buildings or plots of land, it’s in your best interest to have a team of professionals on site with you to offer real-time guidance. Depending on what types of properties you intend to view, your team might include any of the following: Your architect, your broker, a civil engineer, an environmental professional, a general contractor, a surveyor, a local government representation, your attorney, and/or other key stakeholders in the project. Step 3: Equipment Planning As a prospective ASC owner, it’s your responsibility to determine what equipment you’ll need for your facility; this equipment will inform both the design requirements and overall budget of your project. Unless you have prior experience working directly with suppliers, it’s in your best interest to retain the services of a procurement specialist. When vetting potential procurement specialists, look for one who: Specializes in healthcare facility setup (particularly ASCs) Holds certifications such as the Association for Supply Chain Management’s Supply Chain Procurement Certificate Is a member of professional associations such as the Association for Health Care Resource & Materials Management or the Ambulatory Surgery Center Association The full list of equipment you’ll need when building an ambulatory surgery center is extensive and includes: Category Equipment Operating Room Equipment Operating tables Surgical lights Anesthesia machines and monitors Electrosurgical units Surgical instruments and trays Suction units Endoscopy towers and scopes Pre-op and Post-op Equipment Patient beds and stretchers Vital sign monitors Infusion pumps Defibrillators and emergency crash carts Imaging and Diagnostic Equipment Ultrasound machines X-ray machines MRI or CT scanners Laboratory Equipment Basic lab analyzers Refrigerators for specimen storage Sterile Processing Department Equipment Washers-disinfectors Ultrasonic cleaners Sinks and workstations for manual cleaning Drying cabinets Steam sterilizers (autoclaves) Low-temperature sterilizers Sterilization containers, wraps, and pouches Sterile storage racks and cabinets Case carts Transport trolleys Biological and chemical indicators Sterility assurance monitoring systems Administrative and Office Equipment Computers and servers Office furniture (e.g. desks, chairs, filing cabinets) Telecommunication systems Billing and scheduling software Facility Support Equipment HVAC systems Generators Backup generators Medical gas systems Waste management systems Step 4: Design & Development To build an ambulatory surgery center that is functional, efficient, and welcoming, you’ll need to work with qualified architects and engineers who specialize in designing and developing healthcare facilities. The Healthcare Design Directory, professional associations such as the American College of Healthcare Architects and the American Society for Healthcare Engineering, and industry conferences and tradeshows can all be helpful places to start your search. Additionally, connecting with colleagues and seeking recommendations from established ASCs can lead to valuable referrals. When designing your ASC’s layout, be sure to allocate space for all essential workflows. In addition to operating rooms, which will be the core of your facility, you’ll need: A reception/check-in area and waiting room Consultation rooms where physicians can meet with patients before or after procedures A laboratory for on-site testing needs A sterile processing department for cleaning, sterilizing, and storing surgical instruments Preoperative and postoperative areas designated for patient preparation and recovery Storage areas for medical supplies, equipment, and medications Staff areas, including break rooms and administrative offices It’s important that these spaces be designed with patients, physicians, or both parties in mind. For patients and their families, the goal is to create a calm environment where they can recover from their procedure or wait for their loved ones. Spacious waiting areas with comfortable, soothing color schemes, natural lighting, artwork, and easy navigation with clear signage can all create a more inviting atmosphere. Accessibility features such as ramps, wide corridors, and ADA-compliant restrooms ensure inclusivity for all patients, while private recovery rooms offer a quiet space for patients to rest post-surgery. For physicians, the focus is developing a space that enables them to efficiently deliver high-quality care. This includes well-planned OR layouts that reduce unnecessary movement, ergonomic workstations, easily accessible equipment storage, and dedicated areas for physicians to consult with patients and collaborate with colleagues. Some additional tips when designing your ASC: Ensure pre-op, OR, and post-op areas are logically arranged to allow seamless transitions between different stages of care. Create distinct pathways for patient movement and supply transport to prevent cross-contamination and enhance efficiency. Position nurses centrally within patient care areas for easy monitoring and fast response times. Install hand hygiene stations at strategic locations throughout the facility, including the entrance to every room. Use materials and finishes that are durable, non-porous, and easy to clean. Utilize sound-proofing materials to reduce noise levels in post-op areas, ensuring a calm environment for recovering patients. Consider using modular design elements that can be easily reconfigured as your facility’s needs change. Design rooms that can serve multiple purposes, such as consultation rooms that can double as minor procedure rooms if needed. Invest in robust IT infrastructure to support electronic health record storage, telemedicine, and other digital healthcare solutions. Ensure that staff workstations are located near high-traffic areas to reduce time spent walking between tasks. By incorporating these principles, you can design an ASC layout that supports efficient operations while prioritizing the highest standards of patient care. Step 5: Project Bids Blueprints in hand, you’re ready to start soliciting and evaluating project bids from contractors for the construction of your facility. This typically involves working with stakeholders to compile a comprehensive request for proposal (RFP) that outlines the project’s scope, specifications, timeline, and budget. With the help of your architect, engineer, and procurement specialist, you’ll need to distribute your RFP to a list of reputable contractors with prior experience in healthcare construction. When evaluating incoming bids, be sure to consider the following: Does the proposal address all of the requirements listed in your RFP? Does the proposal answer all of the questions included in your RFP? Does the proposal include a detailed breakdown of anticipated costs for labor, materials, equipment, and any subcontracted work? Does the proposed timeline for the project align with your expectations? Does the proposal set clear milestones for project phases, so you can easily track the progress of the project? What are the reputations of any subcontractors or suppliers mentioned in the proposal? Does the proposal clearly explain how the contractor plans to manage and coordinate subcontractors and suppliers to ensure seamless project execution? Does the proposal account for healthcare industry regulations and local, state, and federal requirements? Does the proposal list all of the members of the contractor’s project management team, including their qualifications, experience, and roles? Does the proposal set clear expectations for communications and reporting throughout the project? Does the proposal include contingency plans should issues arise during construction? Is the contractor willing and able to provide references from past clients? Step 6: Equipment Selection & Acquisition While it’s important to plan out your equipment needs early on in the process, you’ll want to select and order your equipment closer to when construction actually starts to avoid potential issues with storage and changes in project specifications. Similar to contractors, you’ll want to carefully evaluate different equipment vendors, as well as the various makes and models for different pieces of equipment, to make informed purchasing decisions. Some key factors to consider during the equipment selection and acquisition process include: What is the manufacturer’s reputation? Are they a well-established company with a history of producing reliable medical equipment? Are there any product reviews or testimonials from other healthcare professionals about the vendor or the particular product? Is the vendor willing and able to provide references for past customers? Does the equipment come with a comprehensive warranty? Does the vendor offer different financing options for their products such as leasing, installment plans, or deferred payment options? Does the manufacturer meet the Food and Drug Administration’s regulations for medical device manufacturing or ISO standards? Is the equipment compatible with the IT infrastructure and software systems you’ve chosen for your facility? How user-friendly is the equipment? Does the vendor offer staff training programs? How responsive is the vendor’s customer service team, and do they offer multiple forms of support? Does the vendor offer maintenance services, either directly or through a third-party provider? Does the vendor have a spare parts program? Can the vendor provide information about the environmental impact of their manufacturing process, or their equipments’ energy consumption? Step 7: Construction With all of the pieces in place, it’s time to transform your architectural plans into a functional facility. While the construction phase of the ASC development process is fairly straightforward — contractors and subcontractors will begin building or renovating your facility — there are still a few things you can do to navigate this stage successfully, including: Establish clear communication channels. This includes holding regular meetings with project stakeholders to discuss progress, assess any issues, and make necessary adjustments. Keep detailed minutes of these meetings to ensure accountability and track decisions made throughout the project. Keep a close eye on your project timeline. Your contractor’s proposal should have included a project timeline inclusive of all major phases of construction, from initial site preparation to final inspections. Regularly compare the actual progress of your project against this planned timeline to identify and promptly address any deviations. Your contractor should have contingency plans in place for potential delays caused by unforeseen circumstances such as weather conditions or supply chain disruptions. Carefully manage your budget to avoid cost overruns. This involves tracking expenditures, approving change orders, and confirming that any additional costs are justified and documented. It’s also beneficial to establish a contingency fund to cover unexpected expenses that may arise during construction. Plan ahead for equipment installation. Your contractor and procurement specialist should work closely together to schedule equipment deliveries and installations at appropriate stages of construction so that the installation process does not interfere with ongoing work and that equipment is properly integrated within your ASC’s infrastructure.In addition to supervising installation, your procurement specialist should: Verify that all equipment is properly connected to power and utility systems Conduct functional, performance, and safety testing Perform final calibrations Compile all equipment documentation, including operational manuals and warranties, to prepare for handover Conduct final inspections and testing. Before your ASC can open, it must pass a series of final inspections to ensure that everything is up to code and functioning correctly. This includes testing all electrical, plumbing, and HVAC systems, as well as verifying the proper installation of equipment. Once testing is complete, conduct a thorough walkthrough with your construction team, architect, engineer, and project manager to create a punch list of any remaining tasks or corrections needed. You’ll need to address these issues promptly to avoid delays in obtaining permits and final certifications. Step 8: Accreditation, Certification, & Licensure Before your new ambulatory surgery center can open to the public, there are three key things you’ll need to obtain: State licensure, Medicare certification, and accreditation. State Licensure At present, 43 states require ASCs to obtain licensure before opening. Licensure requirements vary by state, so you’ll want to consult your state’s health department or relevant regulatory body before proceeding. Most states require you to submit an application with detailed information about your facility, undergo multiple inspections to ensure your facility meets the required standards, and submit records and documentation — including policies and procedures, staff credentials, and emergency plans — for review. Medicare Certification To receive reimbursement from Medicare and Medicaid, your ASC must be certified by the CMS. According to the Ambulatory Surgery Center Association (ASCA), to obtain Medicare certification, ASCs must: Obtain a National Provider Identifier from the National Plan and Provider Enumeration System Enroll in Medicare through either the online Provider Enrollment, Chain and Ownership System or by mailing a completed 855b form to your state’s Medicare Administrative Contractor Demonstrate that your facility meets the CMS’s Conditions for Coverage Either obtain accreditation from an approved organization or agree to be surveyed by their state’s Medicare agency Accreditation While not mandatory, accreditation from recognized bodies such as the Joint Commission, the Accreditation Association for Ambulatory Health Care, the Accreditation Commission for Health Care, or QUAD A can enhance your facility’s reputation, ensure compliance with industry, and support Medicare certification. Each accrediting organization has its own standards and practices, so you’ll want to select one that aligns with your facility’s goals and practices. Once you’ve chosen an accrediting body, you’ll need to: Provide comprehensive details about your ASC’s operations, staffing, and patient protocols, Conduct a self-assessment based on the accrediting body’s standards, Undergo an on-site survey, and Maintain continuous compliance. Step 9: Staffing & Training The final — and perhaps most critical — step in the ASC development process is to find and train a team of highly qualified surgeons, physicians, nurses, technicians, and other personnel to work in your facility. When assembling your team, look for surgeons and physicians with board certification in their respective specialties and a proven track record in performing the types of procedures your ASC will offer. Nurses should have significant experience in perioperative cares, while technicians should be proficient in operating and maintaining surgical equipment. Your team will need to undergo comprehensive training to align with your ASC’s policies and procedures, starting with an orientation program that covers your facility’s missions, values, and patient care philosophy. Initial training should also include detailed information on safety protocols, infection control procedures, and emergency response plans. Ensuring that every team member understands these foundational aspects is vital to creating a safe and effective care environment. You’ll also need to provide specialized training on the operation of various equipment. Given the complexity and precision required in surgical settings, it’s imperative that all staff members be proficient in using your ASC’s equipment. Arrange for hands-on training sessions with equipment vendors or certified trainers to ensure that every staff member is comfortable and skilled in using the technology at their disposal. You can further reinforce training and foster a culture of continuous learning and improvement by providing access to additional workshops, seminars, and certification programs and by scheduling routine training updates and refresher courses. — As a physician, opening your own ambulatory surgery center can be a rewarding experience, not only in terms of financial gain, but also in delivering positive patient outcomes and supporting your community. For additional guidance, we encourage you to explore the ASCA’s full catalog of resources — and, when you’re ready to build your ASC, consider adding Consolidated Sterilizer Systems to your list of equipment vendors. Our healthcare autoclaves are built to last the test of time and can be custom-configured to suit any ASC layout, and our team of specialists are able to provide on-site installation support and equipment training. Start your search for the right sterilizer today with our healthcare autoclave buyer’s guide. Sources: MCG Health, “The Role of Ambulatory Surgical Centers, https://www.mcg.com/blog/2023/08/17/ambulatory-surgical-centers/.” Journal of Spine Surgery, “Ambulatory surgery center ownership models, https://www.ncbi.nlm.nih.gov/pmc/articles/PMC6790806/.” The Leapfrog Group, “Part One: Outpatient Surgical Care: Patient Experience at Ambulatory Surgery Centers (ASCs) and Hospital Outpatient Departments (HOPDs), https://www.leapfroggroup.org/sites/default/files/Files/Patient%20Experience%20Report_OASCAHPS_Final.pdf.” Centers for Medicare & Medicaid Services, “Hospital Outpatient Prospective Payment System (OPPS), https://www.cms.gov/cms-guide-medical-technology-companies-and-other-interested-parties/payment/opps.” Centers for Medicare & Medicaid Services, “Healthcare Common Procedure Coding System (HCPCS), https://www.cms.gov/medicare/coding-billing/healthcare-common-procedure-system.” Surgery Center Consultants, “Costs of Developing an Ambulatory Surgery Center, https://surgerycenterconsultant.com/costs-of-developing-an-ambulatory-surgery-center/.” National Conference of State Legislature, “Certificate of Need State Laws, https://www.ncsl.org/health/certificate-of-need-state-laws.” Centers for Medicare & Medicaid Services, “Conditions for Coverage (CfCs) & Conditions of Participation (CoPs), https://www.cms.gov/medicare/health-safety-standards/conditions-coverage-participation.” Ambulatory Surgery Center Association, “HIPAA Resources, https://www.ascassociation.org/asca/asc-operations/regulations/hipaa-resources.” American Medical Association, “Implementation of the No Surprises Act, https://www.ama-assn.org/health-care-advocacy/access-care/implementation-no-surprises-act.” Ambulatory Surgery Center Association, “Cures Act Final Rule, https://www.ascassociation.org/asca/asc-operations/regulations/cures-act-final-rule.” Samuels Group, “On Shaky Ground – Addressing Unsuitable Soils in Construction, https://www.samuelsgroup.net/blog/addressing-unsuitable-soils-in-construction.” Consolidated Sterilizer Systems, “4 Key Impacts of Sterile Processing in Hospitals and ASCs, https://consteril.com/sterile-processing-department-hospital/.” Ambulatory Surgery Center Association, “Medicare Certification Resources, https://www.ascassociation.org/asca/medicare/certification.” 17 Questions to Ask Before Buying Your Next Autoclave We created this 17-question eBook as a framework to help you explore and discover the exact type of autoclave best suited to your needs. 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