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Study Examines Patient Outcomes Across Settings

Findings show ASCs, on average, provide higher quality care for outpatient procedures than hospitals

BY SAHELY MUKERJI |  JUNE 2018

A study published last December in the Journal of Health Economics looked at patient outcomes in ASCs versus hospital outpatient departments (HOPDs). The researchers found that patients undergoing procedures in an ASC were less likely to experience a subsequent inpatient hospital admission than those who underwent the same procedure in an HOPD. In addition, a reduction in post-procedure adverse events was seen in patients at all risk levels, leading the authors to conclude that there is “no evidence that patients of any risk level … are made worse off by treatment in ASCs.”

According to the researchers, the landscape of medical care changed dramatically in the US in the last 30 years thanks to technological developments in medicine, such as advances in anesthesia and laparoscopic surgery. The number of outpatient surgeries nationwide increased considerably, from 3.8 million in 1981 to nearly 39 million in 2005, and outpatient procedures now represent more than 80 percent of all surgeries. This change in care created a new market for ASCs and the share of all outpatient procedures that occurred in ASCs grew from 4 percent in 1981 to almost 40 percent in 2005.

The study focused on two quality of care measures: inpatient admission and ER visits on the same day, seven or 30 days after an outpatient procedure. Because of the concern that selection into ASCs might bias estimates of facility quality, the study used predicted changes in federally set Medicare facility payment rates as an instrument for ASC utilization to estimate the effect of location of treatment on patient outcomes. Specifically, it relied on a 2008 policy change that mandated that the Medicare facility payment rate for a procedure in an ASC could be no greater than 59 percent of Medicare’s payment rate for that same procedure at a hospital and found that predicted Medicare facility payment rates were an important determinant of whether a patient was treated at an ASC or a hospital.

The study revealed that when ASC payment rates are higher, physicians refer a greater share of patients to ASCs. Further, these patients have better health outcomes in terms of inpatient admission and ER visits following an outpatient procedure. It also proved that ASCs on average provide higher quality care for outpatient procedures than hospitals, and they do so at lower costs than hospitals. The study suggested that one way in which ASCs may provide superior care is through specialization, which may be driven in part by limitations insurance companies impose on which procedures they will reimburse in ASCs for providing.

The study also showed that the positive impact of ASCs on patient outcomes accrues even to the highest risk group of patients, whose care was most likely to be impacted by Medicare’s reimbursement changes.

“Our paper is the first to provide causal evidence on ASC quality, which is critical to understanding the potential welfare gains of providing a greater share of services in ASCs,” the study states. “Future research should continue to measure the effect of competition with ASCs on hospital finances as well as the quality and scope of the care that hospitals provide. Likewise, health care policies should jointly consider the more efficient, higher quality care provided in ASCs and the socially valued services that hospitals provide.”