South Carolina proposes moratorium on ASCs

Other action reported in FL, PA, and ME

A draft of a South Carolina state health plan includes a one-year moratorium on new ambulatory surgery centers (ASCs) and expansion of existing ASCs.

"The idea for the moratorium was sparked by the recent uptick in MDs phoning and meeting with DHEC [the Columbia-based S.C. Department of Health and Environmental Control] staff about starting an ASC," says Lynn Bailey, health care economist in Columbia.

"When the only tool in your toolbox is a hammer, every problem looks like a nail — hence the moratorium," she notes.

The West Columbia-based South Carolina Hospital Association wants to restrain the growth of ASCs, Bailey says. Hospitals can expand surgical capacity less than $2 million with a certificate-of-need exemption, she adds. However, freestanding hospital-owned ASCs billing as a department of the hospital but licensed as freestanding ASCs would be affected by the moratorium, Bailey says.

The moratorium is supported by the South Carolina Hospital Association, according to Jim Walker, vice president.

"This is a period to look at the impact they’re having and determine if there is need for additional ambulatory surgery centers in South Carolina," he says.

It won’t be the first time small health care providers such as ASCs and physician clinics are surprised by regulations, Bailey adds. "These smaller providers operating on narrow margins and with limited reserves simply do their work and mind their own business and get clobbered in the political/regulatory arena," she says.

Since 2001, the SC state health plan has mandated that, before approval could be granted for a new ASC, all existing ASCs in a county had to be licensed and operating for one year to determine the utilization levels for those ASCs.

At press time, the proposed moratorium was scheduled to have a public hearing at the end of July 2004 and go before the DHEC Board in October. If the draft plan is accepted by the state health planning committee and approved by the DHEC board, it will go into effect in mid-October and run for one year.

"During that time, DHEC staff will hold a series of public meetings/hearings to collect information about the impact on ASCs on hospitals," Bailey says. They then will revise the standards and criteria for evaluating a certificate-of-need application in the form of an amendment to the state health plan, she says.

"I expect we will have the ASC moratorium amendment process concluded by November or December 2005," she says. 

In other state news:

• A draft state health plan for Maine says that in considering certificate-of-need applicants, priority projects will not include projects that duplicate existing services or facilities in a region or community that has existing capacity for such services. "This limitation assists in the orderly development of the health care system and in our efforts to control costs," according to the draft plan. At press time, the final plan was expected to be adopted by the governor within a few weeks.

• In Pennsylvania, managers at a surgery center asked the state Department of Health if they could perform laparoscopic cholecystectomies. Upon review, the department decided that it was too invasive to be performed in an ambulatory surgery center (ASC). At press time, a memorandum was scheduled to come from the Department of Health. In the meantime, the department has cited one or two ambulatory surgical facilities for performing laparoscopic cholecystectomies, according to Jessica Seiders, spokeswoman. The department is reviewing the appropriateness of performing laparoscopic procedures in an ambulatory surgical facility, Seiders says.

Kathy Bryant, executive vice president of the Federated Ambulatory Surgery Association (FASA), says FASA is working with ASCs that may choose to appeal this decision. FASA is collecting national data to share with the state, she says.

Florida just enacted a law that prevents licenses for some specialty hospitals. The law prevents a hospital from being licensed or re-licensed if it restricted its medical and surgical services to primarily or exclusively cardiac, orthopedic, surgical, or oncology specialties, or if 65% or more of its discharges in the previous year were for cardiac, orthopedic, or cancer-related diseases and disorders. There is a grandfather clause that allows existing hospitals to continue as long as they have the same ownership, street address, and range of services.

• In New Jersey, a new law requires physician-owned ambulatory care facilities, including surgery centers, to pay a 3.5% gross receipts assessment. The assessment, which is capped at $200,000, will fund charity care. Also, a new law imposes a 6% tax on all elective surgery procedures.


For more information, contact:

  • Lynn Bailey, Lynn Bailey Associates, P.O. Box 2761, Columbia, SC 29202. Phone: (800) 236-3831. Fax: (803) 254-1894. E-mail: