Increased Focus On Outpatient Procedures And Ambulatory Surgery Centers For Medical Device Companies

Throughout the COVID-19 pandemic, ambulatory surgery centers (ASCs) have endured rapid disruption and expansion in order to make the best fit for overall healthcare during the public health crisis. Much like many other businesses across industries, a significant number of ASCs were forced to close their doors and cancel non-essential surgeries, closures that trickled down to manufacturers and distributors of medical equipment.

With a vaccination in operation and pandemic relief in sight, the ASC market (which was already on an upward trajectory pre-COVID) can expect quicker transformation and growth, especially with CMS providing more “flexibility” for elective and non-COVID procedures. A pre-pandemic report suggested that medtech companies were already slow to enact changes to their business models. Now, with a new-found urgency, medical technology and device suppliers are already shifting their strategies in order to keep pace.

Become a Subscriber

Please purchase a subscription to continue reading this article.

Subscribe Now

Medtech enterprises are accustomed to serving large hospitals and medical centers, with larger inventories and a greater number of facilities, whereas ASCs spend less money on fewer devices. Companies such as Stryker and Zimmer Biomet are making new plans-of-action to adapt to the rising number of new inpatient/outpatient procedures approved for surgicenters. With operations including knee and hip replacements made possible in ASC settings, Stryker sees an opportunity to grow their modest market share by focusing more resources to the smaller and more-dispersed healthcare enterprises.

The change could prove tricky for the company, who with a wide selection of products and equipment could face problems with having too broad of an assortment. On the other hand, Zimmer, with its specialty in joint-related appliances, is branching out with two recent acquisitions squarely pointed at the impending ASC boom: Incisive makes AI-enabled operating room infrastructure, and Relign offers a consolidated tower system for arthroscopic procedures. Both stand to drive revenue growth in 2021 and beyond.

Recently, the extensive hospital system operator Tenet Healthcare began selling its urgent care centers (UCCs) and buying ASCs in their stead, a strong prediction for the post-pandemic healthcare ecosystem. The new paradigm brings significant growth potential for medtech companies across the board, increasing competition for companies like Stryker and Zimmer amid an updated and rebooting economy. Medtech organizations will be forced to revamp their business models, but the rise of ASCs as an essential component in healthcare benefits patients and profits.