Opening a New ASC: Step-by-Step Design Guide

Ep. 105: Ryan Short – Opening a New ASC: Step-by-Step Design Guide

Here’s what to expect on this week’s episode. 🎙️

Opening a new ASC?

This week, Ryan Short of Cotton Architecture & Design breaks down the step-by-step process of designing a surgery center—covering site selection, space planning, regulatory approvals, and common pitfalls to avoid.

Five takeaways from the episode:

✅ Site selection is critical—look for “pad-ready” sites with utilities in place.

✅ Doctors need support thinking beyond ORs—questionnaires help uncover overlooked needs.

✅ Permitting & approvals take time—ground-up builds can require 8+ months for approvals.

✅ Supply chain issues persist—major delays can impact timelines, so plan accordingly.

✅ Early contractor involvement helps—changing drawings is easy, but fixing construction mistakes isn’t.

While designing a new surgery center is a huge undertaking, with the right partner(s) in place, it can be done seamlessly and within your expected budget.

Episode Transcript

[00:00:00] Welcome to this week in Surgery Centers. If you are in the ASC industry, then you are in the right place every week. We’ll start the episode off by sharing an interesting conversation we had with our featured guest, and then we’ll close the episode by recapping the latest news impacting surgery centers.

We’re excited to share with you what we have, so let’s get started and see what the industry’s been up to.

Erica: Hi, everyone. Here’s what you can expect on today’s episode. Ryan Short is a principal and founding member at Cotton Architecture and Design. He’s here with us today to walk through the step by step design process for opening a new surgery center. Now, it’s only a 20 minute conversation, so we talked as fast as we could to get through the whole process.

But whether you’re looking to open a new facility, expand your existing one, or really just gain some insight into what goes into the design process, you’ll definitely walk away with some helpful information. And [00:01:00] in our news recap, we’ll cover surgery centers who were affected by the LA fires, game changing advances in orthopedics.

How five ASC management groups fared in 2024. And of course, and the new segment with a positive story about a nurse who is shaping the future of nursing one student and one puppy at a time. Hope everyone enjoys the episode and here’s what’s going on this week in surgery centers.

Hi, Ryan. Welcome to This Week in Surgery Centers.

Ryan: Hi, Erica. How are you?

Erica: Good, thanks. Can you please share a little bit about your ASC experience with our listeners?

Ryan: Absolutely. So my name’s Ryan Short. I’m one of the principals and founders and architects of Cotton Architecture and Design here.

We’re based out of Phoenix. Thanks. So we are a healthcare healthcare focused firm. We do a lot of surgery centers. We like to tell people we don’t just focus on the outpatient stuff. We really focus on really the full continuum of care and continuum of acuity for patients and clients, everything from [00:02:00] inpatient projects to outpatient surgery centers and imaging centers.

So Cotton’s been around for five years, but my business partner and I have been in the healthcare industry for about 10 years for myself and probably about 15 or more for my partner, Steve.

Erica: Very cool. Thank you. So today we’re going to cover the step by step process of designing a new ASC, and we are going to attempt to do this in about 20 minutes.

So let’s dive right into it and start with how to determine the right site. What does that look like?

Ryan: Yeah. So yeah, like you said, we’ll try to compress about a year’s worth of work in 20 minutes. The first step, like you mentioned, really is that site analysis. And a lot of times what what people are looking for, what we help clients look for are pad ready sites.

That just means that the site’s ready to be built on utilities are nearby. And then it’s really about maximizing a building. Square footage for a specific site and trying to help them plan out what that looks like. While also balancing the parking needs. ASCs are fairly high drivers of [00:03:00] parking needs.

So a lot of times we’ll help put together a preliminary site plan for them that shows parking layouts, the flows, the covered drop offs generator locations, all that kind of site constraints is really the first step. And making sure that if a client found a site first making sure that it works for them before they really put a lot of money down onto the site.

Erica: Great. All right. So let’s say they find a site, everyone’s in agreement. What do we do next in terms of the design and space planning?

Ryan: Before we really put pen to paper on designing the building itself, we really need to understand the client’s needs or the operator’s needs of that building.

Simple questions just as to what type of sterilization flow do you want, whether it’s a one room or two room. Type approach can’t significantly drive building areas and what the program for a building is it depends on the doctor too and really what their patient capacity is. We work with a lot of doctors that.

Are very boutique. They might do a small number of [00:04:00] procedures a day and they only need a certain number of pre op and PO pre op and PACU bays in their facilities. We work with other doctors that, that really can churn through patients. They’re hyper efficient and they need a lot of patient base.

So each one of those decisions and many more. really drive what that building is. And so early on we have a questionnaire in house here at Cotton Architecture. It’s probably, 80 questions or so that really help us understand from them what they’re looking for. And it really challenges them to think about what they need.

A lot of doctors think, I just need a surgery center. And then There’s about 5 million other questions that they need to be asked to make sure that they get what they want. So once we get that questionnaire filled out, we will start looking at the, what we call the program of the billing, which is basically just a list of the rooms that are needed and really start dialing in.

The area of the building and really from there, we can start taking those building area blocks and start moving them around on a piece of paper. We call it programming or block plans. And we can start doing that which will help start to [00:05:00] show what that building is and how those various rooms and program elements are distributed.

Erica: I would imagine as most doctors start going through their, the questionnaire, Probably sets off a lot of light bulbs of, Oh my gosh, I didn’t even think of that. And then, they got to go back into planning mode themselves before they even continue work with you.

Ryan: Yeah. And that’s really one of the challenges of working with doctors.

That’s really our focus, I should say is working with these doctors and helping educate them through the design process. Doctors are doctors first in most cases, and their developers or builders second. So that’s really our job to help them through that process. And so we like to guide them and point them to consultants that they might need.

It could be it could be a policies and procedures consultant. It could be an equipment consultant, a shielding consultant, all these different things. We ask questions about and if they don’t have those resources, we have connections and referrals and things like that’ll help them through really the goal is to make it look easy for those doctors.

Cause there’s a lot of [00:06:00] decisions that, that they’re not aware of.

Erica: Yeah, I’m sure. Okay. So they’ve answered the questionnaire. They’re starting to see it come to life on paper. You’re starting to lay it out. Then what do we do next?

Ryan: Yeah. So much of what we’ve talked about so far, we would consider pre design.

So we get all that out of the way and then we actually start the formal design process and in the industry, there’s really three main phases and that’s schematic design development and construction documents are really the three and it doesn’t necessarily mean much to the clients, but basically all they need to know is that there’s increasing levels of detail and complexity that we begin to overlay into our drawings.

After schematic design, we might have floor plans to present and ceiling plans to present and maybe some interior concepts of different spaces and how the rooms work. And we will typically review that with the surgery center staff. The doctors and users and all the various people that might be involved in the process we’ll do a page turn and we’ll essentially get them to approve that package.

And then we’ll continue to the next [00:07:00] phase and begin to develop a lot more detail. So really the way to, to think about a schematic design is really reviewing and understanding the flows and the overall big picture of the building design development. It’s really about defining and coordinating the systems of the project.

And that could be your mechanical, your plumbing, electrical, all those types of systems. It’s really something that we hit hard in the design development phase, which is that middle phase. And then the construction document phase is really where everything’s locked in. Hopefully there’s no more plan changes or feature requests from the doctor.

And we really start defining what all of those details are. We get into the nitty gritty of how the building’s built and. How everything’s laid out in that stage. So it’s an increasing level of complexity and detail. Got it. And each step along the way of getting buy in from the doctors.

Erica: And how long up until this point in the design process, how many months in are we? I’m sure that’s a loaded question. Looks different for everybody, but on average. How many months are we up to by now? Sure.

Ryan: Sure. And for a [00:08:00] ground up ASC, it could be about three months, I would say would be moving along at a pretty good pace.

Assuming we can get a buy in from the owner and making sure that they’re reviewing things in a timely manner and all the outside consultants that we don’t control are giving us information in a timely manner. Three months, maybe for a ground up. If it’s a tenant improvement project maybe two months.

There’s a little bit of time it just takes to work through these. There’s a lot of coordination. So it takes time. And of course the larger the building, the longer it is.

Erica: Got it. That’s actually a little faster than I would have anticipated. So that’s great to hear. All right. So next, are we moving on to regulatory stuff?

Ryan: Yeah, regulations. I’m sure all the ASC providers and doctors love regulations. They’ve got their own world of that they’ve got to deal with. On our side, it’s broken into two parts. A tenant improvement project is typically much, much easier to get through approval on the city side.

And so that could take about a two month, two month process to get through, at least here in the [00:09:00] Phoenix area. Maybe three months, just depending on the city, frankly. And typically what we have to approve is the full set of drawings on an ASC project. There might be 80 to 100 drawings on a tenant improvement project.

So we submit that into the city and the city reviews it. And there’s a little bit of back and forth and communication between us and the city. Typically we answer questions they might have, or we can address comments or concerns they might have which is all part of the standard permitting process.

So two months A ground up project is much more time intensive to get permitted. A lot of cities especially in larger metro areas, have what’s called site entitlements. They might have site planning or design guidelines or environmental surveys that have to be done.

So a lot of that, it, it really takes time and in many cities, it’s a sequential process, so you might have to. Like in the city of Phoenix here, we might have to submit for a pre application package, which is basically just a notice to the city with a simple site plan that, hey, this is what we’re thinking on the site, let us know if the city is okay with it, even, [00:10:00] or if there’s any concerns the city might have and usually you have to get approved on that piece first, and then you can submit your site plan package, which is a whole different package.

And like I said, it all just takes time. So pre application, there’s a site plan, there’s civil work, which is The site and grading and things like that. So it can take longer. There’s probably about eight months worth of just permitting processes that we have to go through on a ground up building.

But there are some things that we can do to expedite that. There’s some things we can do concurrently, which we try to advise our clients on. But there is also just a little bit of that reality that it just takes time. And a lot of people aren’t planning on that, especially if they have a land carrying costs and development costs and things like that.

And once you get permitted, construction, takes off from there.

Erica: Sure. Yeah. Let’s switch gears. Permits are approved. We’ve got everything we need. Let’s start with construction.

Ryan: Yeah. Yeah. So construction on a ground up could take a year. And a TI could be six to eight months, something like that.

The industry now [00:11:00] because of COVID and because of supply chain constraints and because of Prevailing market conditions right now is challenged in a lot of basic items that are needed for a surgery center, especially on electrical gear size. So essentially the large electrical panels that are on the outsides of buildings that all of the main utilities come into there’s a real challenge in getting those you have to wait.

In some cases, 10 to 12 months just to get a delivery of one of those. So we call those our critical path items. Those are usually the items that we track the closest and make sure are moving along. But the schedule is really dictated by those elements. And once construction starts whether it’s a tenant improvement project or a ground up building, really what happens, or at least the way we like to see it is really close collaboration between ourselves the contractors and the owners and really anyone else, the city, even during construction. And we’re always going out to the site and we’re walking it with the owner and the contractor and holding their hand through that process and helping answer questions a contractor might have about.

What exactly we want or need in these [00:12:00] different rooms. So it’s a really collaborative process. And then in a lot of ways, we’re the owner’s agent out, out in the field. They’re making sure things are being built, how they want it, what they’re paying for and, double checking contractor invoices and things like that, just on their behalf.

And really helping them through. We’re really here to help and to protect our clients. That’s really our main goal. So even throughout construction, even though a lot of people think cool, that’s the contractor’s world. We are still pretty heavily involved throughout.

Erica: And do you work with your clients to choose who the construction?

Company is that you’re going to work with

Ryan: our initial preference is always to engage with a contractor early on in the process. In some of those early design phases, even like a schematic design or design development phase, we like to get contractors involved or at least advise the owner. They should start talking to them.

And what that does is it helps us. Really hone in and answer questions ahead of time before those drawings are even finished. We like to joke that changing drawings is [00:13:00] free. Once it’s out in the field, it’s very expensive to change things. It’s not free on the architect side. We spend time and money to fix things, but it’s much easier for everyone to, to change some lines on a paper early on.

Before things become real. So we like to get a contractor involved early if possible not all owners are willing to but we really advise them that it really is better for the project. Sometimes contractors will charge for it because they are spending time and they do put in a lot of effort that we really value.

So some owners are reluctant to do that. But at some point they’re going to have to get a contractor involved. And like I said, the earlier, the better if they don’t get them involved in that design process the older school way of doing projects is what’s called design bid build.

So essentially we would go through our process, finish that package of drawings. And then us, or the owner would put it out into the market to several different GCs and they would bid on it. And that’s a little bit older school. We don’t see that too much anymore. But it does come up there’s some benefits and drawbacks either way, of [00:14:00] course.

Erica: Sure. Yeah, that’s really interesting. Okay. So construction is done. Equipment is installed. What’s our.

Ryan: So every state has their own licensure process. I’ll take Arizona because it’s the state we practice in the most. In Arizona there’s a architectural review that needs to happen by the architect prior to the owner submitting for their license, which is just.

Backup, I guess there’s an architectural application piece. And then there’s the actual owner’s license, which is their medical license we used to in Arizona have to submit a package of drawings and things like that to the state. The state would review that approve the architectural drawings, and then the owner can submit their licensure process.

It’s simplified now. Right now what we have to do is basically collect a package of information from our general contractors everything from how flammable materials are in a building and making sure that those are safe what your testing and balance and air flows [00:15:00] are in your air in your ASC and making sure that the engineer has reviewed and approved those.

Making sure your med gas system is safe. So there’s a quite a bit of documentation that we collect. And again, it’s to protect our owner. And once we get through all of that information and we review it we basically send an approval letter to the state. And then the owner is actually able to apply for their license.

Many states are like that. They have similar steps. We do work in New Mexico. It’s similar in some ways, but it’s a really state by state process. So finding an architect that knows what to look for in these application processes or knowing having a local architect that has been through it really saves a lot of headaches.

We see a lot of out of state architects coming into Arizona and trying to do what we do, and they really have a hard time and really can mess things up if they don’t know what they’re doing. And then, of course, once the state gets the facility licensed, then it’s really on the owner’s side to go through whatever kind of accreditation program they might want, AAHC, and all the others Joint Commission, [00:16:00] whatever it might be.

That’s really on their side to, to start Working through, but it’s something that we have our eyes on and can make sure we’re moving towards that date.

Erica: I would imagine then it becomes real, very exciting. Everyone just waiting for all the final approvals needed.

Ryan: Yep. Yeah. The other thing that, that is important for. For surgery centers to know or people running surgery centers is even though the contractor’s done there usually is a little bit of a time lag between when they can actually start seeing patients.

We can’t submit our application until the building’s done. So you know, of course the state takes their time and it could be a month or two. The project might just be sitting there. So again, there’s carrying costs and all kinds of costs that owners need to be aware of and or at least they’re planning for.

Erica: Sure. And at a high level, are there just some common challenges you’ve seen ASCs run into? During the design process as a whole.

Ryan: Yeah. The big things are just not having equipment information that we need. That really holds us up. If a doctor’s got a specific [00:17:00] CR and he wants to use, or if it’s a fixed piece of equipment we need product data and all the information on the electrical connections as an example for that piece of equipment before we can finish our design.

And a lot of times we just don’t get that in a timely manner. So that, that, that hurts us sometimes.

Erica: Perfect. All right, Ryan, we do this every week with our guests. What is one thing our listeners can do this week to improve their surgery centers?

Ryan: I think to really challenge the status quo of what you’ve seen in surgery centers there’s not a one size fits all approach.

And I think, you’re designing a surgery center, it can be a once in a lifetime chance to really put your mark on your practice and do things the way that you want of course, within the stipulations of the building code and all those different things, but there’s so much innovation and creativity that goes on in ASCs these days challenge yourself, challenge your design team, and hopefully you have a design team that, that is up to that challenge and we can really work hard and develop that.

New model of practice that you’re [00:18:00] excited about and make your dream a reality.

Erica: You have been a wealth of knowledge. I know our listeners will get a lot out of this conversation, so thank you so much for coming on. We really appreciate it.

Ryan: Absolutely. Thank you.

As always, it has been a busy week in healthcare, so let’s jump right in. In early January, wildfires tore through the LA area, forcing several ASCs to close their doors. Among them was Risser Surgery Center in Pasadena, which narrowly escaped destruction thanks to an external sprinkler system. When their admin noticed an orange glow in the sky, she quickly learned the fire had reached Risser.

Erica: The next day, though, the team was already in crisis mode, assessing damage, cleaning up, and activating their emergency management plan. While RISR is working towards reopening, Huntington Ambulatory Surgery Center faced its own challenges. Not only did they lose power, but about 10 of their physicians lost their homes, [00:19:00] and local schools were destroyed, leaving staff scrambling for childcare.

The poor air quality delayed their reopening, but in the meantime, staff stepped up by helping their affiliated hospital, which was overwhelmed with displaced nursing home patients. And as you can imagine, financial losses were significant. RISR estimated around 160, 000 in canceled cases, while Huntington ASC saw higher payroll costs from longer shifts.

But in the face of disaster, both centers prioritize patient care, even waiving fees for those who lost everything in the fire. And you know, in hindsight, the disaster underscores the critical need for ASC emergency preparedness. Wildfires, floods, and other crises can strike at any time. Regularly updating response plans, conducting scenario drills, and building partnerships with hospitals can help ASCs pivot when disaster hits.

But perhaps most importantly, this event highlights the resilience of [00:20:00] the ASC community. When disaster struck, these teams did what they could to protect their business, but also made sure to protect their patients and staff and support their local community along the way. So we wish you the best and for all the ASCs and everybody else who was affected by the fires and reopening and rebuilding and getting back to some sort of normal.

Alright, the orthopedic industry is continuing to evolve thanks to groundbreaking advancements in surgical technology. From robotic assisted procedures to AI powered imaging and smart implants, the field is seeing rapid innovation that’s improving precision, reducing recovery times, and making surgery even safer.

Dr. Hooman Melamed, an orthopedic spine surgeon in Beverly Hills, highlights how new technology is enabling ultra minimally invasive procedures. These innovations allow for more outpatient surgeries and result in reduced blood loss, quicker recoveries, and improved [00:21:00] outcomes. AI is playing a growing role as well with augmented reality tools that overlay critical surgery information onto a surgeon’s view and AI driven analytics are helping predict outcomes and refine surgical planning while 3D imaging is making pre op assessments even more accurate.

Smart implants are now capable of tracking a patient’s recovery in real time, allowing for personalized adjustments as recovery progresses. And lastly, advances in pain management are also making a difference. With new opioid free treatments and long acting anesthetics, helping patients recover faster with less reliance on medication. In HST’s State of the Industry report, we shared how ortho by far has the highest net revenue per case out of all the specialties, coming in with an average of 6, 419 per case.

So as robotics, AI, regenerative med continue to advance, combined with a potential revenue and growing patient [00:22:00] preference to have surgery in an ASC versus a hospital, Ortho just continues to be in a strong place to continue expanding. All right. Our third story, the ASC industry saw significant expansion in 2024 with major players aggressively growing through acquisitions, joint ventures, and de novo developments.

And this Becker’s ASC article, they did a quick recap of how five of the largest ASC management groups solidified their market positions, setting the stage for continued consolidation and competition in 2025. So let’s take a look at each of them. USPI maintained its position as the largest ASC operator with an 8. 1 percent market share. Adding nearly 70 centers in 2024, it played a key role in parent company. Tenant healthcare’s financial success, contributing nearly half of tenant’s $3.99 billion in EBITDA and Uspis own ebitda.

Jumped 20% to $1.8 [00:23:00] billion with further growth planned through a $250 million annual investment in ambulatory acquisition. SCA Health, a division of Optum expanded its ortho footprint with the acquisition of Ortho Alliance, a private equity backed firm with over 200 physicians. With a 5 percent market share and 320 ASCs, SCA Health benefited from Optum’s massive 253 billion in revenue, which saw an 11.

7 percent increase year over year.

AmSurg closed the year with about 250 ASCs and 2000 affiliated physicians pursuing joint ventures and acquisitions across the country. Major deals included partnerships in San Diego, Las Vegas, and Maryland, reinforcing its 3. 9 percent market share. HCA Healthcare, managing 124 ASCs under its Surgery Ventures division, focused on greenfield developments and new construction.[00:24:00]

It partnered with NexCore Group to open a new ASC and medical office in Katy, Texas, continuing its expansion strategy. And lastly, surgery partners has a 2 percent market share managing over 160 centers and deploying nearly 400 million in acquisitions. It also received a 3. 2 billion acquisition proposal from Bain Capital, significantly strong investor interest in the ASC sector. The dominance of these five ASC companies underscores the ongoing trend of consolidation and investment in outpatient surgery.

Expect to see further PE interest, technological advancements, and expansion into high growth specialties like ortho and cardiology as the industry evolves in 2025. And to end our new segment on a positive note, for decades, Dr. Beth Quattrara has been a guiding force at the University of Virginia School of Nursing, blending clinical [00:25:00] experience with a deep commitment to her students.

As the nurse of the week, she’s being recognized for her profound impact on the next generation of nurses. Dr. Quattrara is known for her advocacy for military students, celebrating military promotions, organizing veterans day events, and making sure they feel her encouragement.

She also raises service dogs in training. So she’s also known for always having a Labrador retriever puppy in her office, which as you can imagine, helps to bring a comforting presence to a very stressful academic setting. So congrats to Dr. Kutrara for making such a lasting impact on her students and for being recognized as nurse of the week by the Daily Nurse.

And that officially wraps up this week’s podcast. Thank you as always for spending a few minutes of your week with us. Make sure to subscribe or leave a review on whichever platform you’re listening from. I hope you have a great day and we will see you again next week.[00:26:00]