Office, ASC and hospital outpatient settings pay differently, cost differently and carry different risk. A plain-English map of the mechanics.
9 min readGrowUrology editorial
In short
What this explainer covers · 3 parts
A urologist performing the same procedure in three settings is running three different businesses. Understanding which one you are in is the precondition for every capital decision that follows.
These three move independently. A setting can pay more in total while contributing less to your practice, and a setting can pay less while contributing more, depending entirely on which components you capture and what they cost you.
Medicare payment policy revisits setting differentials regularly, and procedural specialties feel it disproportionately. The 2026 Physician Fee Schedule is the current example, with an efficiency adjustment applied to the work component of many non-time-based services and continued attention to how procedures are paid across settings. Independent urology advocacy — LUGPA's work on prostate biopsy payment being one visible thread — exists precisely because these mechanics determine whether independent practice remains economically viable.
Two things. First, know your own contracted commercial rates by setting; they do not automatically mirror Medicare's structure. Second, when you model a capital investment, run it at the current differential and again at a materially less favourable one. If the plan only works at today's rates, you are underwriting regulatory risk you have not priced.
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