How Medtech Founders Should Adjust Strategy for the Ambulatory Surgery Center Shift

The ambulatory surgery center shift is not a channel expansion. It's a different buyer, a different cost structure, and a different standard for what makes a product win, and medtech strategy built only for hospitals is already behind.

Key Takeaways

• There are roughly 15,000 hospitals in the United States and somewhere between 120,000 and 150,000 ASCs, a market Ted Bird of Dymicron calls much bigger than the hospital channel most medtech strategy still targets by default.
• Some procedures cost two to three times more in a hospital than in an ASC, the core economic driver behind the shift, according to takeaways from AdvaMed's MedTech Con.
• Smith+Nephew's Craig Gaffin designed the Cori robot's footprint specifically for the ASC setting, because a facility that can only fit one robot has to be the obvious choice.
• Gaffin compares the opportunity to Intuitive Surgical's rise: strong early positioning in an emerging setting created the pull-through that took the company toward a $200 billion market cap.
• ASCs reward efficiency and turnaround time over the feature depth that wins in a hospital, which means a product built for hospital sales cycles often needs real adjustment, not just a new sales channel.

Watch the full episode on YouTube

Why the ASC Shift Is Bigger Than Most Founders Realize

Most medtech strategy still treats the hospital as the primary site of care and the ASC as a secondary channel. The actual scale of the two markets doesn't support that assumption anymore.

Ted Bird, Chief Strategy Officer at Dymicron, laid out the numbers directly on an episode about the world's first diamond disc replacement:

"There's 15,000 hospitals in the United States, but there's 120,000 to 150,000 ASCs, which is a much, much bigger market."

That gap isn't a rounding error. It's an order of magnitude, and it's been widening for years.

A separate episode on boosting medtech revenue through digital sales put the growth in motion: the number of ASCs went from around a thousand to roughly 12,000 in a comparatively short window, while hospital counts stayed flat.

A medtech strategy that still allocates resources as if hospitals were the larger market is optimizing for the smaller, slower-growing side of the business.

Why Cost Pressure Is Driving the Shift to ASCs

The ASC shift isn't happening because patients prefer it, though many do. It's happening because the economics leave hospitals struggling to compete on price for the procedures ASCs can handle.

Takeaways from AdvaMed's MedTech Con keynote made the cost gap explicit:

"Some procedures can be two or sometimes even three times more costly in a large hospital system versus an ASC setting."

That differential is why payers and health systems keep pushing eligible procedures toward the lower-cost setting. No marketing campaign reverses a structural cost advantage that keeps compounding as more procedure types become ASC-eligible.

A medtech strategy built around hospital pricing and hospital procurement cycles is built for a shrinking share of eligible procedures, not a stable market.

Why Product Footprint and Setup Time Decide Who Wins in ASCs

Winning in an ASC isn't the same competition as winning in a hospital. Space, setup time, and turnaround speed become decision criteria in a way they rarely are inside a large hospital system.

Craig Gaffin, President of Global Orthopedics at Smith+Nephew, explained why Smith+Nephew designed its Cori robot around that exact constraint:

"We feel that the footprint is optimal for the ASC. You think about time constraints in the OR, and ultimately when you're going to get a robot, you have to choose. A hospital might have multiple robots, but here it comes down to, let's pick the robot that provides the most value to us."

A hospital can run several competing platforms in parallel and let each earn its place. An ASC frequently can't. That single-choice dynamic raises the stakes on footprint, setup time, and how quickly a system can turn a room around between cases.

Products designed for hospital flexibility don't automatically translate into ASC-ready products. The constraint has to be designed for directly, the way Gaffin's team did with Cori.

Why Positioning Early Compounds Like Intuitive Surgical's Did

Getting the product right for ASCs is necessary but not sufficient. The founders who benefit most are the ones who position early, before the setting fully matures, not after competitors have already claimed it.

Gaffin drew a direct comparison to Intuitive Surgical's rise on the same episode:

"Part of the reason why they went from a few billion dollar market cap to now close to a $200 billion market cap is that they were just so well positioned in the market that the market had such strong pull-through."

Intuitive didn't win because it entered a mature category with better features. It won because it positioned itself early enough that the market's growth pulled the company along with it, rather than the company having to push against an already-settled field.

Founders waiting for the ASC shift to fully mature before building a strategy around it are giving up the exact positioning advantage that made Intuitive's trajectory possible in the first place.

What This Means for Medtech Founders

In my experience working with medtech founders, the ASC shift gets treated as a distribution detail: add an ASC sales motion once the hospital business is established. That sequencing misses how large and how permanent this shift is.

The founders who adjust well start by taking the market size seriously. A channel with 120,000 to 150,000 sites isn't secondary to one with 15,000, even if hospitals still generate more revenue per account today.

They also design for the ASC's real constraints, footprint, setup time, and single-choice purchasing, rather than assuming a hospital-ready product will translate. And they position early, the way Smith+Nephew is doing with Cori, instead of waiting for the category to fully form before entering it.

The ASC shift rewards founders who treat it as a distinct strategic problem now. It punishes the ones who keep treating it as a smaller version of the hospital business they already understand.

Frequently Asked Questions

Why Are Ambulatory Surgery Centers Growing So Much Faster Than Hospitals?

ASCs offer lower-cost care for eligible procedures, often two to three times cheaper than the same procedure performed in a hospital.

That cost advantage, combined with patient preference for faster, more convenient care, has driven ASC counts from around a thousand to roughly 12,000 in recent years.

What Should Medtech Founders Change About Product Design for the ASC Market?

Products need to account for space constraints, fast setup and turnaround time, and the reality that many ASCs can only support one platform in a given category rather than several competing ones side by side, unlike a typical hospital.

Is It Too Early for a Medtech Company to Build an ASC Strategy?

No. Founders who position early in an emerging setting, the way Intuitive Surgical did before its category matured, tend to benefit from the market's own growth pulling demand toward them, rather than having to compete for share in an already-settled field.

Where to Go From Here

If you're doing this yourself. Read the medtech commercialization strategy breakdown to see how category and channel decisions like the ASC shift fit into the broader sequence founders need to plan around.

If you want it engineered with you. MarketCraft takes on a small number of medtech teams each quarter, starting with The Market Engineering Audit. For founders weighing an ASC strategy, the audit checks whether the product and positioning are built for that setting.

Listen to the Full Conversations

• Why Smith+Nephew Is Betting Big on the ASC Boom With Craig Gaffin, President of Global Orthopedics
• Ted Bird, Chief Strategy Officer at Dymicron, the World's First Diamond Disc Replacement
• Boosting MedTech Revenue With Digital Sales
• AdvaMed MedTech Con 2023 Keynote Takeaways

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About the Author

Omar Khateeb is the founder of MarketCraft and host of The State of MedTech, the number one podcast in the medtech industry.

He works with medtech founders and commercial leaders on market engineering, commercialization strategy, and revenue growth. Visit marketcraft.ai or subscribe to The State of MedTech for weekly conversations with the people building the future of medical devices.