IG report: Some states fall short on oversight of surgery centers


Photo: Hospital UTPL via Flickr

Here’s a somewhat worrisome report from the Office of Inspector General.  Some two-thirds of the ambulatory surgery centers (ASCs) in the nation are supposed to be surveyed for quality and safety issues by their state health agency, according to Medicare rules. But a troubling number of states seem to be ignoring their responsibility.

Since Medicare reimburses ASCs for certain approved procedures — including some that carry higher risks for complications — federal officials have set requirements for how often and how extensively those state agencies are supposed to inspect those facilities.  One could argue, and many have, that stricter standards should be put into place, but this report is just about the compliance of the ones that do exist.

The agency found that 15 states failed to meet Medicare’s highest priority benchmark, to survey at least 25% of their ASCs every year, although seven of those 15 came within one survey of meeting their quota.

The OIG found that in fiscal year 2017, more than half of the states — 28 — did not meet Medicare’s second priority requirement that those states survey all their ASCs at least within the prior six years. And some of those lapses were among high-population states, like New Jersey and North Carolina, which left up to 10% of their ASCs unsurveyed since prior to 2013.

Some of those failed states are among the largest: California, Pennsylvania, Texas, New York, Florida, Illinois, Michigan and Ohio, nine of the 10 most populous states.

Eleven states failed to meet both priority requirements and three — with a total of 213 ASC facilities within them — Hawaii, Nevada and New Jersey — failing to meet either requirement by large margins, the report said.  The report’s tables identify which states failed and which passed.

Why is this important? For starters, about 3,700 of the 5,603 ambulatory surgery center facilities in the nation in FY 2017 were under the purview of their state health agency. The rest, some 1,900 ASCs, are surveyed not by their state agencies but by a Medicare-approved “deeming” agency such as The Joint Commission. The reason for the difference was not addressed in this report, but that distinction in itself, and whether deeming agencies find more problems, might make an interesting story.

Thus, these state agencies “play critical roles in ensuring the health and safety of Medicare beneficiaries who receive medical procedures, including invasive surgeries, from ASCs,” and because “periodic surveys are an essential tool for ensuring that ASCs meet the minimum standards for health and safety,” the report said.

Second, ambulatory surgery centers are not only increasing in number, but they are doing riskier procedures like joint replacements, for which they are paid less than if the procedure were performed in an inpatient or hospital outpatient setting.

Third, Medicare paid $4.6 billion to ASCs in 2017.

To show the importance of these surveys, it appears that the state agencies that did conduct surveys found problems, and some of them were significant threats to patient safety.

Just over three-fourths of the facilities surveyed between fiscal years 2013 and 2017 had at least one deficiency and 25% had serious deficiencies, with the most common one being lapsed infection control, which made up about 20% of the deficiencies. Serious deficiencies are of such gravity as to indicate what the report called “pervasive noncompliance,” posing “a serious threat to patient health and safety.”

“These findings underscore the importance of timely surveys so that deficiencies do not go unaddressed even longer,” the report said.

Other findings or story angles:

  • Between fiscal years 2013 and 2017, complaints were filed on just 4% of ASCs, but the share of those complaints that required an onsite survey, including those considered an “immediate jeopardy,” i.e. likely to cause, serious injury, harm, impairment, or death, more than tripled, from 15% to 54%.
  • One could ask whether it’s enough to ask states to survey just 25% of their ASCs every year, or whether a facility should go up to six years without a survey.
  • The OIG pointed out that in general, ASCs “appear to struggle” with infection control requirements. In fact, when states did inspect their ASCs, they found more than half were deficient in infection control procedures, such as making sure surgical equipment was properly sanitized.
  • Of the 732 complaints that states received about ASCs between FY2013 and FY2017, nearly half were substantiated. They included a finding that the ASC “failed to properly assess patients pre-operatively, did not have medical records for some patients, and did not follow its own procedures.”
  • Of the ASCs inspected, roughly a third had problems meeting either pharmaceutical requirements, or environmental controls or patient rights, and some failed to meet all three.
  • Number of ASCs are increasing — 25% between 2006 and 2017— because more procedures are being done in them instead of in hospitals.
  • Why do so many facilities opt to be overseen by their state agency, instead of so-called “deemed” accreditation organizations, such as the Joint Commission? Are deemed accreditation organizations thought to be more strict or time intensive?
  • Another possibly worrisome issue is that many patients I know who have had a procedure in an ambulatory surgery center were there for more than 24 hours, and spent at least one night. Yet the OIG said that ASCs perform services that are safely performed within less than 24 hours, including pre-operative and recovery time. While the most common procedures reimbursed by Medicare that are performed at ASCs are cataract procedures and colonoscopies, Medicare reimbursees for permanent pacemaker placement, it plans to reimburse ASCs for knee replacement and also plans to cover several interventional cardiac procedures in 2020.
  • The report is important because it’s the first time the OIG has assessed ASC state certification frequency in more than 17 years.
  • For those surveys that were done by state agencies, the mean number of deficiencies dropped between 2013 and 2017, from 6.1 to 4.2, but that may not mean the facilities were providing safer or higher quality care. The report suggests that some states may have changed the aggressiveness of their inspections.
    “These decreases could reflect improvements in ASC performance and/or changes in how states assessed compliance,” it said.
  • What is inspected during an inspection that can affect safety? To be reimbursed, ASCs must pass muster on 14 issues, for example, setting standards for who is qualified to administer anesthesia. The ASC must have an infection control program overseen by a trained infection control professional and assure that each patient has appropriate pre and post-surgical condition assessments and documentation.

There’s a lot of meat in this report, especially as the Centers for Medicare & Medicaid Services has plans to allow ASCs, many of which are privately owned rather than affiliated with a hospital system, to do a lot more procedures that involve increasing complexity and are increasingly invasive.


  1. Call for comment from your state health agency that is supposed to inspect your region’s ASCs.
  2. Find out what the Ambulatory Surgery Center Association, the trade group, has to say about the OIG’s findings. The contact there is Kay Tucker, ktucker@ascassociation.org
  3. Read the latest CMS proposed rule that would add more quality measures to ASC reporting requirements.
  4. Review CMS’ quality measure data files for ASCs. You can view scores for the nation, by state or by individual facility.
  5. Find out the ownership of ASCs in your area, whether it’s hospitals, physician groups or other corporate interests.
  6. Read Kaiser Health News reporter Christina Jewett’s and Mark Alesia’s excellent reporting on lax oversight at ambulatory surgery centers. Also see this piece on an outbreak of hepatitis C linked to a gastroenterology practice and this piece about surgery center patients that were possibly exposed to hepatitis and HIV.

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