Over the past decade, the Center for Medicare & Medicaid Services (CMS) has been steadily reshaping how U.S. healthcare is funded – shifting from a fee-for-service model to one that emphasizes value, outcomes, and efficiency. Starting with the Affordable Care Act in 2010 and accelerating with initiatives like the Medicare Access and CHIP Reauthorization Act (MACRA) in 2015, CMS introduced models such as the Merit-based Incentive Payment System (MIPS), the Accountable Care Organization (ACO) Shared Savings Program, and bundled payments.
These frameworks now tie a growing share of reimbursement to measurable outcomes rather than volume of care. In other words, the U.S. healthcare system is tying more dollars than ever to value-based outcomes – rewarding hospitals not for how much care they provide, but how well they deliver it.
For hospitals and clinicians, this evolution has brought a new urgency to operational performance – especially in high-cost, resource-intensive areas like the operating room (OR). According to recent data, ORs account, on average, for 35-40% of total hospital costs, making them critical to both clinical and financial outcomes.
Therefore, to overcome revenue pressure, improving OR performance is becoming less and less a ‘nice-to-have’ and more a financial and clinical imperative.
Despite being central to patient care, the OR remains surprisingly under-optimized. Legacy systems, siloed data, and manual documentation persist across healthcare systems – creating blind spots that hinder both clinical and operational performance.
Notably, data reveals that 50% of OR staff report spending over an hour daily resolving scheduling conflicts and equipment or staffing issues. While other departments have seemingly embraced digital transformation, the OR has lagged due to high costs, complex workflows, and concerns about downtime.
This ‘digital lag’ has tangible consequences. Variability in surgical performance and inefficient use of time and resources naturally translate into missed opportunities for better patient outcomes – and under value-based payment models, these gaps can now be penalized.
The issue to date is that traditional modernization efforts often involve costly infrastructure upgrades or installation of proprietary hardware systems that are hard to scale. However, as financial pressures rise, hospitals need smarter, more flexible solutions – ones that enhance decision-making and streamline workflows without requiring a complete hardware overhaul.
The numbers reiterate the potential of a software-first approach to OR modernization. We recently analyzed over 700 hours of operating room video and 10,000+ workflow data points — in partnership with a major U.S. health system — uncovering that up to 24% of total OR time could be optimized. This optimized time has a real, monetary value; by unlocking the opportunity to perform an additional 9,000 procedures each year, the partner could achieve an added $90 million in revenue; resulting from reductions in unnecessary delays, smoother team coordination, and more consistent adherence to surgical protocols.
These findings highlight a broader opportunity to showcase how emerging technologies, using innovations in AI, can surface inefficiencies in real time and support targeted improvements — without requiring a major overhaul of existing systems.
Device-agnostic, cloud-based platforms can provide real-time analytics on surgical workflows, support remote collaboration, and enable post-operative review — helping ORs run more efficiently; treating patients more quickly and effectively. In essence, rather than relying on retrospective metrics alone, these tools offer a proactive, in-the-moment view of OR performance that aligns directly with the goals of value-based care: better outcomes, fewer complications, and more efficient use of resources.
As CMS continues to tie reimbursement to measurable outcomes, many hospitals will be rethinking what defines value in the operating room. It’s no longer just about individual clinical excellence — it’s about how systems perform, how teams collaborate, and how workflows are optimized. Data-driven technologies are helping define this new standard. By making surgical performance more visible, measurable, and improvable in real time, they support a shift toward more productive ORs and more effective care – reducing variation, improving outcomes, and ultimately generating revenue.
The data is clear: the OR is full of untapped efficiency. With tools that can scale across systems without heavy infrastructure demands, hospitals have a real opportunity to align surgical performance with the incentives — and expectations — of value-based care.
For health systems navigating this transition, the path forward isn’t just about cutting costs. It’s about using smarter tools to build a more adaptive, accountable, and outcomes-focused surgical environment — one that meets the moment CMS has created.
About Dr Nadine Hachach-Haram
Dr Nadine Hachach-Haram is a practicing surgeon, lecturer and award winning clinical entrepreneur. As Founder / CEO of Proximie, she is driving improved surgical outcomes, MedTech innovation, and OR productivity across the globe.
