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AHRQ Study: Price Increases Steady for Ambulatory Surgery Centers, Significantly Higher for Hospital Outpatient Surgery Departments

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The proliferation of ambulatory surgery centers (ASCs) has not led to a decrease in hospital outpatient surgery department prices, according to a new AHRQ-funded study. ASCs are medical facilities where surgery that does not require hospital admission is performed. This study examined ASC growth and revenues using a large national claims database that contains information on actual prices paid. The author found that for six common outpatient surgical procedures—cataract surgery with intraocular lenses, colonoscopy, knee arthroscopy with debridement, knee arthroscopy with meniscectomy, postcataract surgery and upper gastrointestinal endoscopy—prices paid to ASCs remained stable during 2007–2012, while prices paid to hospital outpatient surgery departments (HOPSDs) for the same procedures increased sharply. The study also found that private insurers paid ASCs more than Medicare paid ASCs for the same procedures. Medicare currently pays ASCs a legislated percentage of what it pays HOPSDs for the same services, but there is a considerable discrepancy between this ratio and the ratio of payments by private insurers across provider types and procedures. These findings question the use of a single ratio for ASC payments to HOPSD payments and suggest that ASCs and HOPSDs do not currently compete on price. The findings support the argument for increased price transparency and narrow or tiered insurance network designs that reward high-value providers.

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