Comparative Safety of Robotic-Assisted vs Laparoscopic Cholecystectomy.

Importance: Robotic-assisted cholecystectomy is rapidly being adopted into practice, partly based on the belief that it offers specific technical and safety advantages over traditional laparoscopic surgery. Whether robotic-assisted cholecystectomy is safer than laparoscopic cholecystectomy remains unclear. Objective: To determine the uptake of robotic-assisted cholecystectomy and to analyze its comparative safety vs laparoscopic cholecystectomy. Design, Setting, and Participants: This retrospective cohort study used Medicare administrative claims data for nonfederal acute care hospitals from January 1, 2010, to December 31, 2019. Participants included 1 026 088 fee-for-service Medicare beneficiaries 66 to 99 years of age who underwent cholecystectomy with continuous Medicare coverage for 3 months before and 12 months after surgery. Data were analyzed August 17, 2022, to June 1, 2023. Exposure: Surgical technique used to perform cholecystectomy: robotic-assisted vs laparoscopic approaches. Main Outcomes and Measures: The primary outcome was rate of bile duct injury requiring definitive surgical reconstruction within 1 year after cholecystectomy. Secondary outcomes were composite outcome of bile duct injury requiring less-invasive postoperative surgical or endoscopic biliary interventions, and overall incidence of 30-day complications. Multivariable logistic analysis was performed adjusting for patient factors and clustered within hospital referral regions. An instrumental variable analysis was performed, leveraging regional variation in the adoption of robotic-assisted cholecystectomy within hospital referral regions over time, to account for potential confounding from unmeasured differences between treatment groups. Results: A total of 1 026 088 patients (mean [SD] age, 72 [12.0] years; 53.3% women) were included in the study. The use of robotic-assisted cholecystectomy increased 37-fold from 211 of 147 341 patients (0.1%) in 2010 to 6507 of 125 211 patients (5.2%) in 2019. Compared with laparoscopic cholecystectomy, robotic-assisted cholecystectomy was associated with a higher rate of bile duct injury necessitating a definitive operative repair within 1 year (0.7% vs 0.2%; relative risk [RR], 3.16 [95% CI, 2.57-3.75]). Robotic-assisted cholecystectomy was also associated with a higher rate of postoperative biliary interventions, such as endoscopic stenting (7.4% vs 6.0%; RR, 1.25 [95% CI, 1.16-1.33]). There was no significant difference in overall 30-day complication rates between the 2 procedures. The instrumental variable analysis, which was designed to account for potential unmeasured differences in treatment groups, also showed that robotic-assisted cholecystectomy was associated with a higher rate of bile duct injury (0.4% vs 0.2%; RR, 1.88 [95% CI, 1.14-2.63]). Conclusions and Relevance: This cohort study's finding of significantly higher rates of bile duct injury with robotic-assisted cholecystectomy compared with laparoscopic cholecystectomy suggests that the utility of robotic-assisted cholecystectomy should be reconsidered, given the existence of an already minimally invasive, predictably safe laparoscopic approach.

Trends in Use of Robotic Surgery for Privately Insured Patients and Medicare Fee-for-Service Beneficiaries.

This cohort study evaluates trends in the adoption of robotic surgery among Medicare beneficiaries and privately insured patients for common general surgical procedures.

Changes in Dialysis Center Quality Associated With the End-Stage Renal Disease Quality Incentive Program : An Observational Study With a Regression Discontinuity Design.

BACKGROUND: In 2012, the Centers for Medicare & Medicaid Services started levying performance-based financial penalties against outpatient dialysis centers under the mandatory End-Stage Renal Disease Quality Incentive Program. OBJECTIVE: To determine whether penalization was associated with improvement in dialysis center quality. DESIGN: Leveraging the threshold for penalization (total performance score < 60), a regression discontinuity design was used to examine the effect of penalization on quality over 2 years. Publicly available Medicare data from 2015-2018 were used. The effect of penalization at dialysis centers with different characteristics (for example, size or chain affiliation) was also examined. SETTING: United States. PARTICIPANTS: Outpatient dialysis centers (n = 5830). MEASUREMENTS: Dialysis center total performance scores (a composite metric ranging from 0 to 100 based on clinical quality and adherence to reporting requirements) and individual measures that contribute to the total performance score. RESULTS: There were 1109 (19.0%) outpatient dialysis centers that received penalties in 2017 on the basis of performance in 2015. Penalized centers were located in ZIP codes with a higher average proportion of non-White residents (36.4% vs. 31.2%; P < 0.001) and residents with lower median income ($49 290 vs. $51 686; P < 0.001). Penalization was not associated with improvement in total performance scores in 2017 (0.4 point [95% CI, -2.5 to 3.2 points]) or 2018 (0.3 point [CI, -2.8 to 3.4 points]). This was consistent across dialysis centers with different characteristics. There was also no association between penalization and improvement in specific measures. LIMITATION: The study could not account for how centers respond to penalization. CONCLUSION: Penalization under the End-Stage Renal Disease Quality Incentive Program was not associated with improvement in the quality of outpatient dialysis centers. PRIMARY FUNDING SOURCE: None.

Wide Variation in Surgical Spending Within Hospital Systems: A Missed Opportunity for Bundled Payment Success.

OBJECTIVE: We sought to measure the extent of variation in episode spending around total hip replacement within and across hospital systems. SUMMARY OF BACKGROUND DATA: Bundled payment programs are pressuring hospitals to reduce spending on surgery. Meanwhile, many hospitals are joining larger health systems with the stated goal of improved care at lower cost. METHODS: Cross-sectional study of fee-for-service Medicare patients undergoing total hip replacement in 2016 at hospital systems identified in the American Hospital Association Annual Survey. We calculated risk- and reliability-adjusted average 30-day episode payments at the hospital and system level. RESULTS: Average episode payments varied nearly as much within hospital systems ($2515 between the lowest- and highest-cost hospitals, 95% confidence interval $2272-$2,758) as they did between the lowest- and highest-cost quintiles of systems ($2712, 95% confidence interval $2545-$2879). Variation was driven by post-acute care utilization. Many systems have concentrated hip replacement volume at relatively high-cost hospitals. CONCLUSIONS: Given the wide variation in surgical spending within health systems, we propose tailored strategies for systems to maximize savings in bundled payment programs.

Association of Medicaid Eligibility With Surgical Readmission Among Medicare Beneficiaries.

Importance: The Centers for Medicare & Medicaid Services is beginning to consider adjusting for social risk factors, such as dual eligibility for Medicare and Medicaid, when evaluating hospital performance under value-based purchasing programs. It is unknown whether dual eligibility represents a unique domain of social risk or instead represents clinical risk unmeasured by variables available in traditional Medicare claims. Objective: To assess how dual eligibility for Medicare and Medicaid is associated with risk-adjusted readmission rates after surgery. Design, Setting, and Participants: A retrospective cohort study was conducted of 55 651 Medicare beneficiaries undergoing general, vascular, and gynecologic surgery at 62 hospitals in Michigan between January 1, 2014, and December 1, 2016. Representative cohorts were derived from traditional Medicare claims (n = 29 710) and the Michigan Surgical Quality Collaborative (MSQC) clinical registry (n = 25 941), which includes additional measures of clinical risk. Statistical analysis was conducted between April 10 and July 15, 2019. The association between dual eligibility and risk-adjusted 30-day readmission rates after surgery was compared between models inclusive and exclusive of additional measurements of clinical risk. The study also examined how dual eligibility is associated with hospital profiling using risk-adjusted readmission rates. Exposures: Dual eligibility for Medicare and Medicaid. Main Outcomes and Measures: Risk-adjusted all-cause 30-day readmission after surgery. Results: There were a total of 3986 dual-eligible beneficiaries in the Medicare claims cohort (2554 women; mean [SD] age, 72.9 [6.9] years) and 1608 dual-eligible beneficiaries in the MSQC cohort (990 women; mean [SD] age, 72.9 [6.8] years). In both data sets, higher proportions of dual-eligible beneficiaries were younger, female, and nonwhite than Medicare-only beneficiaries (Medicare claims cohort: female, 2554 of 3986 [64.1%] vs 12 879 of 25 724 [50.1%]; nonwhite, 1225 of 3986 [30.7%] vs 2783 of 25 724 [10.8%]; MSQC cohort: female, 990 of 1608 [61.6%] vs 12 578 of 24 333 [51.7%]; nonwhite, 416 of 1608 [25.9%] vs 2176 of 24 333 [8.9%]). In the Medicare claims cohort, dual-eligible beneficiaries were more likely to be readmitted (15.5% [95% CI, 13.7%-17.3%]) than Medicare-only beneficiaries (13.3% [95% CI, 12.7%-13.9%]; difference, 2.2 percentage points [95% CI, 0.4-3.9 percentage points]). In the MSQC cohort, after adjustment for more granular measures of clinical risk, dual eligibility was not significantly associated with readmission (difference, 0.6 percentage points [95% CI, -1.0 to 2.2 percentage points]). In both the Medicare claims and MSQC cohorts, adding dual eligibility to risk-adjustment models had little association with hospital ranking using risk-adjusted readmission rates. Conclusions and Relevance: This study suggests that dual eligibility for Medicare and Medicaid may reflect unmeasured clinical risk of readmission in claims data. Policy makers should consider incorporating more robust measures of social risk into risk-adjustment models used by value-based purchasing programs.

Most Patients Undergoing Ground And Air Ambulance Transportation Receive Sizable Out-Of-Network Bills.

"Surprise" out-of-network bills have come under close scrutiny, and while ambulance transportation is known to be a large component of the problem, its impact is poorly understood. We measured the prevalence and financial impact of out-of-network billing in ground and air ambulance transportation. For members of a large national insurance plan in 2013-17, 71 percent of all ambulance rides involved potential surprise bills. For both ground and air ambulances, out-of-network charges were substantially greater than in-network prices, resulting in median potential surprise bills of $450 for ground transportation and $21,698 for air transportation. Though out-of-network air ambulance bills were larger, out-of-network ground ambulance bills were more common, with an aggregate impact of $129 million per year. Out-of-network air ambulance bills averaged $91 million per year, rising from $41 million in 2013 to $143 million in 2017. Federal proposals to limit surprise out-of-network billing should incorporate protections for patients undergoing ground or air ambulance transportation.

Out-of-Network Bills for Privately Insured Patients Undergoing Elective Surgery With In-Network Primary Surgeons and Facilities.

Importance: Privately insured patients who receive care from in-network physicians may receive unexpected out-of-network bills ("surprise bills") from out-of-network clinicians they did not choose. In elective surgery, this can occur if patients choose in-network surgeons and hospitals but receive out-of-network bills from other involved clinicians. Objective: To evaluate out-of-network billing across common elective operations performed with in-network primary surgeons and facilities. Design, Setting, and Participants: Retrospective analysis of claims data from a large US commercial insurer, representing 347 356 patients who had undergone 1 of 7 common elective operations (arthroscopic meniscal repair [116 749]; laparoscopic cholecystectomy [82 372]; hysterectomy [67 452]; total knee replacement [42 313]; breast lumpectomy [18 018]; colectomy [14 074]; coronary artery bypass graft surgery [6378]) by an in-network primary surgeon at an in-network facility between January 1, 2012, and September 30, 2017. Follow-up ended November 8, 2017. Exposure: Patient, clinician, and insurance factors potentially related to out-of-network bills. Main Outcomes and Measures: The primary outcome was the proportion of episodes with out-of-network bills. The secondary outcome was the estimated potential balance bill associated with out-of-network bills from each surgical procedure, calculated as total out-of-network charges less the typical in-network price for the same service. Results: Among 347 356 patients (mean age, 48 [SD, 11] years; 66% women) who underwent surgery with in-network primary surgeons and facilities, 20.5% of episodes (95% CI, 19.4%-21.7%) had an out-of-network bill. In these episodes, the mean potential balance bill per episode was $2011 (95% CI, $1866-$2157) when present. Out-of-network bills were associated with surgical assistants in 37% of these episodes; when present, the mean potential balance bill was $3633 (95% CI, $3384-$3883). Out-of-network bills were associated with anesthesiologists in 37% of episodes; when present, the mean potential balance bill was $1219 (95% CI, $1049-$1388). Membership in health insurance exchange plans, compared with nonexchange plans, was associated with a significantly higher risk of out-of-network bills (27% vs 20%, respectively; risk difference, 6% [95% CI, 3.9%-8.9%]; P < .001). Surgical complications were associated with a significantly higher risk of out-of-network bills, compared with episodes with no complications (28% vs 20%, respectively; risk difference, 7% [95% CI, 5.8%-8.8%]; P < .001). Among 83 021 procedures performed at ambulatory surgery centers with in-network primary surgeons, 6.7% (95% CI, 5.8%-7.7%) included an out-of-network facility bill and 17.2% (95% CI, 15.7%-18.8%) included an out-of-network professional bill. Conclusions and Relevance: In this retrospective analysis of commercially insured patients who had undergone elective surgery at in-network facilities with in-network primary surgeons, a substantial proportion of operations were associated with out-of-network bills.

Perioperative Outcomes and Trends in the Use of Robotic Colectomy for Medicare Beneficiaries From 2010 Through 2016.

Importance: The use of robotic surgery for common operations like colectomy is increasing rapidly in the United States, but evidence for its effectiveness is limited and may not reflect real-world practice. Objective: To evaluate outcomes of and trends in the use of robotic, laparoscopic, and open colectomy across diverse practice settings. Design, Setting, and Participants: This population-based study of Medicare beneficiaries undergoing elective colectomy was conducted between January 2010 and December 2016. We used an instrumental variable analysis to account for both measured and unmeasured differences in patient characteristics between robotic, open, and laparoscopic colectomy procedures. Data were analyzed from January 21, 2019, to March 1, 2019. Exposures: Receipt of robotic colectomy. Main Outcomes and Measures: Incidence of postoperative medical and surgical complications and length of stay. Results: A total of 191 292 procedures (23 022 robotic procedures [12.0%], 87 639 open procedures [45.8%], and 80 631 laparoscopic colectomy procedures [42.0%]) were included. Robotic colectomy was associated with a lower adjusted rate of overall complications than open colectomy (17.6% [95% CI, 16.9%-18.2%] vs 18.6% [95% CI, 18.4%-18.7%]; relative risk [RR], 0.94 [95% CI, 0.91-0.98]). This difference was driven by lower rates of medical complications (15.5% [95% CI, 14.8%-16.2%] vs 16.9% [95% CI, 16.7%-17.1%]; RR, 0.92 [95% CI, 0.87-0.96]) because surgical complications were higher with the robotic approach (3.0% [95% CI, 2.8%-3.2%] vs 2.4% [95% CI, 2.3%-2.5%]; RR, 1.18 [95% CI, 1.04-1.35]). There were no differences in complications between robotic and laparoscopic colectomy (11.1% [95% CI, 10.5%-11.6%] vs 11.0% [95% CI, 10.8%-11.2%]; RR, 1.00 [95% CI, 0.95-1.05]). There was an overall shift toward greater proportional use of robotic colectomy from 0.7% (457 of 65 332 patients) in 2010 to 10.9% (8274 of 75 909 patients) in 2016. In hospitals with the highest adoption of robotic colectomy between 2010 and 2016, increasing use of robotic colectomy (0.8% [100 of 12 522 patients] to 32.8% [5416 of 16 511 patients]) was associated with a greater replacement of laparoscopic operations (43.8% [5485 of 12 522 patients] to 25.2% [4161 of 16 511 patients]) than open operations (55.4% [6937 of 12 522 patients] to 41.9% [6918 of 16 511 patients]). Conclusions and Relevance: While robotic colectomy was associated with minimal safety benefit over open colectomy and had comparable outcomes with laparoscopic colectomy, population-based trends suggest that it replaced a greater proportion of laparoscopic rather than open colectomy, especially in hospitals with the highest adoption of robotics.

Association of Discretionary Hospital Volume Standards for High-risk Cancer Surgery With Patient Outcomes and Access, 2005-2016.

Importance: Various clinical societies and patient advocacy organizations continue to encourage minimum volume standards at hospitals that perform certain high-risk operations. Although many clinicians and quality and safety experts believe this can improve outcomes, the extent to which hospitals have responded to these discretionary standards remains unclear. Objective: To evaluate the association between short-term clinical outcomes and hospitals' adherence to the Leapfrog Group's minimum volume standards for high-risk cancer surgery. Design, Setting, and Participants: Longitudinal cohort study using 100% of the Medicare claims for 516 392 patients undergoing pancreatic, esophageal, rectal, or lung resection for cancer between January 1, 2005, and December 31, 2016. Data were accessed between December 1, 2018, and April 30, 2019. Exposures: High-risk cancer surgery in hospitals meeting and not meeting the minimum volume standards. Main Outcomes and Measures: Patients having surgery in hospitals meeting the volume standard and 30-day and in-hospital mortality and complication rates. Results: Overall, a total of 516 392 procedures (47 318 pancreatic resections, 29 812 esophageal resections, 116 383 rectal resections, and 322 879 lung resections) were included in the study, and patient mean (SD) age was 73.1 (7.5) years. Outcomes improved over time in both hospitals meeting and not meeting the minimum volume standards. Mortality after pancreatic resection decreased from 5.5% in 2005 to 4.8% in 2016 (P for trend <.001). Mortality after esophageal resection decreased from in 6.7% 2005 to 5.0% in 2016 (P for trend <.001). Mortality after rectal resection decreased from 3.6% in 2005 to 2.7 % in 2016 (P for trend <.001). Mortality after lung resection decreased from 4.2% in 2005 to 2.7 % in 2016 (P for trend <.001). Throughout the study period, there were no statistically significant differences in risk-adjusted mortality between hospitals meeting and not meeting the volume standards for esophageal, lung, and rectal cancer resections. Mortality rates after pancreatic resection were consistently lower at hospitals meeting the volume standard, although mortality at all hospitals decreased over the study period. For example, in 2016, risk-adjusted mortality rates for hospitals meeting the volume standard were 3.8% (95% CI, 3.3%-4.3%) compared with 5.7% (95% CI, 5.1%-6.5%) for hospitals that did not. Although an increasing majority of patients underwent surgery in hospitals meeting the Leapfrog volume standards over time, the overall proportion of hospitals meeting the standards in 2016 ranged from 5.6% for esophageal resection to 23.3% for pancreatic resection. Conclusions and Relevance: Although volume remains an important factor for patient safety, the Leapfrog Group's minimum volume standards did not differentiate hospitals based on mortality for 3 of the 4 high-risk cancer operations assessed, and few hospitals were able to meet these standards. These findings highlight important tradeoffs between setting effective volume thresholds and practical expectations for hospital adherence and patient access to centers that meet those standards.

Centralization of High-Risk Cancer Surgery Within Existing Hospital Systems.

PURPOSE: Centralization is often proposed as a strategy to improve the quality of certain high-risk health care services. We evaluated the extent to which existing hospital systems centralize high-risk cancer surgery and whether centralization is associated with short-term clinical outcomes. PATIENTS AND METHODS: We merged data from the American Hospital Association's annual survey on hospital system affiliation with Medicare claims to identify patients undergoing surgery for pancreatic, esophageal, colon, lung, or rectal cancer between 2005 and 2014. We calculated the degree to which systems centralized each procedure by calculating the annual proportion of surgeries performed at the highest-volume hospital within each system. We then estimated the independent effect of centralization on the incidence of postoperative complications, death, and readmissions after accounting for patient, hospital, and system characteristics. RESULTS: The average degree of centralization varied from 25.2% (range, 6.6% to 100%) for colectomy to 71.2% (range, 8.3% to 100%) for pancreatectomy. Greater centralization was associated with lower rates of postoperative complications and death for lung resection, esophagectomy, and pancreatectomy. For example, there was a 1.1% (95% CI, 0.8% to 1.4%) absolute reduction in 30-day mortality after pancreatectomy for each 20% increase in the degree of centralization within systems. Independent of volume and hospital quality, postoperative mortality for pancreatectomy was two times higher in the least centralized systems than in the most centralized systems (8.9% v 3.7%, P < .01). Centralization was not associated with better outcomes for colectomy or proctectomy. CONCLUSION: Greater centralization of complex cancer surgery within existing hospital systems was associated with better outcomes. As hospitals affiliate in response to broader financial and organization pressures, these systems may also present unique opportunities to improve the quality of high-risk cancer care.

Variation in Surgical Outcomes Across Networks of the Highest-Rated US Hospitals.

Importance: Hospitals are rapidly consolidating into regional delivery networks. To our knowledge, whether these multihospital networks leverage their combined assets to improve quality and provide a uniform standard of care has not been explored. Objective: To evaluate the extent to which surgical outcomes varied across hospitals within the networks of the highest-rated US hospitals. Design, Settings, and Participants: This longitudinal analysis of 87 hospitals that participated in 1 of 16 networks that are affiliated with US News & World Report Honor Roll hospitals used data from Medicare beneficiaries who were undergoing colectomy, coronary artery bypass graft, or hip replacement between 2005 and 2014 to evaluate the variation in risk-adjusted surgical outcomes at Honor Roll and affiliated hospitals within and across networks. The data were analyzed between April 20, 2018, and June 25, 2018. Main Outcomes and Measures: Thirty-day postoperative complications, mortality, failure to rescue, and readmissions. Results: Of 143 174 patients, 68 718 (48.0%) were men, 124 427 (86.9%) were white, and the mean (SD) age was 71.8 (9.9) years and 73.5 (9.1) years in Honor Roll and affiliated hospitals, respectively. Outcomes were not consistently better at Honor Roll hospitals compared with network affiliates. For example, Honor Roll hospitals had lower failure to rescue rates (13.3% vs 15.1%; odds ratio, 0.92; 95% CI, 0.86-0.98) but higher complication rates (22.1% vs 18.0%; odds ratio, 1.11; 95% CI, 1.03-1.19). Within networks, risk-adjusted outcomes varied widely across affiliated hospitals. The differences in failure to rescue varied by as little as 1.1-fold (range, 12.7%-14.3%) in some networks to as much as 4.9-fold (range, 7.6%-37.3%) in others. Similarly, complication rates varied by 1.1-fold (range, 21%-23%) to 4.3-fold (range, 6%-26%) across all networks. Conclusions and Relevance: Surgical outcomes vary widely across hospitals affiliated with the US News & World Report Honor Roll hospitals. Public reporting mechanisms should provide patients with information on the quality of all network-affiliated hospitals. Networks should monitor variations in outcomes to characterize and improve the extent to which a uniform standard of care is being delivered.

How Patient Complexity and Surgical Approach Influence Episode-Based Payment Models for Colectomy.

BACKGROUND: Bundled payment programs broaden hospitals' responsibility for spending to entire episodes of care. After demonstration programs in cardiac surgery and joint replacement, these payment reforms could soon extend to major operations like colectomy under Medicare's Bundled Payments for Care Improvement - Advanced Model. OBJECTIVE: This study aims to evaluate how specific policies and surgical practice patterns would influence hospital reimbursement in a bundled payment program for colectomy. DESIGN: This was a population-based study. SETTINGS: We used national data from the 100% Medicare Provider Analysis and Review files for the years 2010 to 2014. PATIENTS: We identified patients undergoing colon resections by using diagnosis-related group codes and International Classification of Diseases, Ninth Revision, Clinical Modification codes. MAIN OUTCOME MEASURES: We simulated per case reconciliation payments as the difference between actual price-standardized 90-day episode payments and estimated regional spending benchmarks among fee-for-service Medicare beneficiaries undergoing colectomy (2010-2014).We projected per patient and overall hospital-level reconciliation payments and the proportion of hospitals that would achieve shared savings under bundled payment conditions. We also assessed how variation in the use of laparoscopy could influence shared savings, using instrumental variable methods to account for selection bias between laparoscopic and open procedures. RESULTS: Under simulated bundled payment conditions, 51.8% of hospitals would achieve shared savings, but the average case would incur a reconciliation penalty of -$234 (95% CI, -$245 to -$223). Risk adjustment would increase the proportion of hospitals with shared savings to 54.3% (per case payment, +$237; 95% CI, $96-$379). Hospitals performing a greater proportion of cases laparoscopically would achieve higher per case reconciliation payments. For example, per case reconciliation penalties would be -$472 (95% CI, -$506 to -$438) for hospitals that performed 10% of their procedures laparoscopically, whereas those that performed 70% laparoscopically would receive payments of +$294 (95% CI, $262-$326). LIMITATIONS: Alternative payment models for colectomy have not yet been introduced. CONCLUSIONS: Surgical leaders must be prepared with strategies for optimizing episode efficiency. Inclusion of risk adjustment in bundled payment calculations and expanding utilization of laparoscopic surgery may represent approaches to achieve shared savings and improve surgeon engagement in alternative payment models for surgical care. See Video Abstract at http://links.lww.com/DCR/A928.

Targeting Value-Driven Quality Improvement for Laparoscopic Cholecystectomy in Michigan.

OBJECTIVE: The purpose of this study was to evaluate complete episode expenditures for laparoscopic cholecystectomy, a common and lower-risk operation, to characterize novel targets for value-based quality improvement. SUMMARY BACKGROUND DATA: Despite enthusiasm for improving the overall value of surgical care, most efforts have focused on high-risk inpatient surgery. METHODS: We identified 19,213 patients undergoing elective laparoscopic cholecystectomy from 2012 to 2015 using data from Medicare and a large private payer. We calculated price-standardized payments for the entire surgical episode of care and stratified patients by surgeon. We used linear regression to risk- and reliability-adjusted expenditures for patient characteristics, diagnoses, and the use of additional procedures. RESULTS: Fully adjusted total episode costs varied 2.4-fold across surgeons ($7922-$17,500). After grouping surgeons by adjusted total episode payments, each component of the total episode was more expensive for patients treated by the most expensive versus the least expensive quartile of surgeons. For example, payments for physician services were higher for the most expensive surgeons [$1932, 95% confidence interval (CI) $1844-$2021] compared to least expensive surgeons ($1592, 95% CI $1450-$1701, P < 0.01). Overall differences were driven by higher rates of complications (10% vs. 5%) and readmissions (14% vs. 8%), and lower rates of ambulatory procedures (77% vs. 56%) for surgeons with the highest versus lowest expenditures. Projections showed that a 10% increase ambulatory operations would yield $3.6 million in annual savings for beneficiaries. CONCLUSIONS: Episode payments for laparoscopic cholecystectomy vary widely across surgeons. Although improvements in several domains would reduce expenditures, efforts to expand ambulatory surgical practices may result in the largest savings to beneficiaries in Michigan.