Joint-Venture Ambulatory Surgery Centers: The Perfect Partnership.

BACKGROUND: Ambulatory surgery growth has increased in the last few decades as ambulatory surgery centers have been shown to succeed in cost efficiencies through their smaller size and breadth, specialization of care, and ability to quickly participate in perioperative process improvement and education. METHODS: A 5-year retrospective fiscal review was performed for all Northwell Health-physician ambulatory surgery center joint ventures. The outcome measures studied included model of ownership, specialty types, and gross revenue. Additional facility characteristics were studied, including growth trajectory, facility size, and cost to build a de novo facility. RESULTS: Eleven free-standing ambulatory surgery centers were identified at Northwell Health during the 5-year study period. The total gross revenue for all Northwell clinical joint ventures for 2019 alone was $102,854,000. Northwell Health is a majority stakeholder in eight of their joint venture ambulatory surgery centers, with an average Northwell ownership of 53 percent and an average number of physician owners per facility of 11. The number of hospital-physician joint-venture ambulatory surgery centers grew from two to 11 facilities during the study period (450 percent). Surgical volume followed a similar trajectory, increasing 295 percent over the same time period. CONCLUSIONS: The ambulatory surgery center setting provides a vast number of possibilities for key stakeholders, including patients themselves, to benefit from financial and clinical efficiencies. Ambulatory surgery centers have been popular, as they meet patient expectations for convenience of elective surgery, reduce payer and clinical pressures to minimize length of stay in hospitals, and achieve similar or higher quality care with less intense resources.

Implementation of Outpatient Minimally Invasive Lumbar Decompression at an Academic Medical Center without Ambulatory Surgery Centers: A Cost Analysis and Systematic Review.

BACKGROUND: Lumbar decompressions are increasingly performed at ambulatory surgery centers (ASCs). We sought to compare costs of open and minimally invasive (MIS) lumbar decompressions performed at a university without dedicated ASCs. METHODS: Lumbar decompressions performed at a tertiary academic hospital or satellite university hospital dedicated to outpatient surgery were retrospectively reviewed. Care pathways were same-day, overnight observation, or inpatient admission. Patient demographics, American Society of Anesthesiologists classification, Charlson Comorbidity Index, surgical characteristics, 30-day readmission, and costs were collected. A systematic review of lumbar decompression cost literature was performed. RESULTS: A total of 354 patients, mean age 55 years with 128 women (36.2%), were reviewed. There was no significant difference in age, gender, body mass index, American Society of Anesthesiologists classification, or Charlson Comorbidity Index between patients treated with open and minimally invasive surgery. Open decompression was associated with higher total cost ($21,280 vs. $14,407; P < 0.001); however, this was driven by care pathway and length of stay. When stratifying by care pathway, there was no difference in total cost between open versus minimally invasive surgery among same-day ($10,609 vs. $11,074; P = 0.556), overnight observation ($14,097 vs. $13,992; P = 0.918), or inpatient admissions ($24,507 vs. $27,929; P = 0.311). CONCLUSIONS: When accounting for care pathway, the cost of open and MIS decompression were no different. Transition from a tertiary academic hospital to a university hospital specializing in outpatient surgery was not associated with lower costs. Academic departments may consider transitioning lumbar decompressions to a dedicated ASC to maximize cost savings; however, additional studies are needed.

Healthcare costs for abortions performed in ambulatory surgery centers vs office-based settings.

BACKGROUND: Several states require that abortions be provided in ambulatory surgery centers. Supporters of such laws argue that they make abortions safer, yet previous studies have found no differences in abortion-related morbidities or adverse events for abortions performed in ambulatory surgery centers versus office-based settings. However, little is known about how costs of abortions provided in ambulatory surgery centers differ from those provided in office-based settings. OBJECTIVE: To compare healthcare expenditures for abortions performed in ambulatory surgery centers versus office-based settings using a large national private insurance claims database. MATERIALS AND METHODS: A retrospective cohort study compared expenditures for abortions performed in ambulatory surgery centers versus office-based settings. Data on women who had abortions in an ambulatory surgery center or office-based setting between January 1, 2011, and December 31, 2014 were obtained from the MarketScan Commercial Claims and Encounters database. The sample was limited to women who were continuously enrolled in their insurance plans for at least 1 year before and at least 6 weeks after the abortion. Healthcare expenditures were assessed separately for the index abortion and the 6-week period after the abortion. Costs were measured from the perspective of the healthcare system and included all payments to the provider, including insurance company payments and any patient out-of-pocket payments. RESULTS: Overall, 49,287 beneficiaries who had 50,311 abortions met inclusion criteria. Of the included abortions, 47% were first-trimester aspiration, 27% first-trimester medication, and 26% second-trimester or later abortions. Most abortions (89%) were provided in office-based settings, with 11% provided in ambulatory surgery centers. Unadjusted mean index abortion costs were higher in ambulatory surgery centers than in office-based settings ($1704 versus $810; P < .001). After adjusting for patient clinical and demographic characteristics, costs of index abortions were $772 higher (95% confidence interval, $746-$797), total follow-up costs for abortions that had any follow-up care were $1099 higher (95% confidence interval, $1004-$1,195), and total follow-up costs for abortions that had an abortion-related morbidity or adverse event were not significantly different in ambulatory surgery centers compared to office-based settings. There were also no significant differences in the likelihood of having any follow-up care or abortion-related event follow-up care. CONCLUSION: Abortions performed at ambulatory surgery centers are significantly more costly than those performed in office-based settings, with no difference in the likelihood of receiving follow-up care. Laws requiring that abortions be provided in ambulatory surgery centers may only result in increased costs for abortions, with no effect on abortion safety.

Same-Day vs Different-Day Elective Upper and Lower Endoscopic Procedures by Setting.

Importance: Performing elective upper and lower endoscopic procedures on the same day is a patient-centered and less costly approach than a 2-stage approach performed on different days, when clinically appropriate. Whether this practice pattern varies based on practice setting has not been studied. Objectives: To estimate the rate of different-day upper and lower endoscopic procedures in 3 types of outpatient settings and investigate the factors associated with the performance of these procedures on different days. Design, Setting, and Participants: A retrospective analysis was conducted of Medicare claims between January 1, 2011, and June 30, 2018, for Medicare beneficiaries who underwent a pair of upper and lower endoscopic procedures performed within 90 days of each other at hospital outpatient departments (HOPDs), freestanding ambulatory surgery centers (ASCs), and physician offices. Main Outcomes and Measures: Undergoing an upper and a lower endoscopic procedure on different days, adjusted for patient characteristics (age, sex, race/ethnicity, residence location and region, comorbidity, and procedure indication) and physician characteristics (sex, years in practice, procedure volume, and primary specialty). Adjusted odds ratios (aORs) and 95% CIs were calculated. Results: A total of 4 028 587 procedure pairs were identified, of which 52.5% were performed in HOPDs, 43.3% in ASCs, and 4.2% in physician offices. The rate of different-day procedures was 13.6% in HOPDs, 22.2% in ASCs, and 47.7% in physician offices. For the 7564 physicians who practiced at both HOPDs and ASCs, their different-day procedure rate changed from 14.1% at HOPDs to 19.4% at ASCs. For the 993 physicians who practiced at both HOPDs and physician offices, their different-day procedure rate changed from 15.8% at HOPDs to 37.4% at physician offices. Patients were more likely to undergo different-day procedures at physician offices and ASCs compared with HOPDs, even after adjusting for patient and physician characteristics (physician office vs HOPD: aOR, 2.02; 95% CI, 1.85-2.20; ASC vs HOPD: aOR, 1.27; 95% CI, 1.23-1.32). Older age (85-94 years vs 65-74 years: aOR, 1.10; 95% CI, 1.08-1.11; 95 years or older vs 65-74 years: aOR, 1.14; 95% CI, 1.03-1.26), black and Hispanic race/ethnicity (black: aOR, 1.15; 95% CI, 1.12-1.17; Hispanic: aOR, 1.12; 95% CI, 1.10-1.14), and residing in the Northeast region (adjusted OR, 1.32; 95% CI, 1.28-1.36) were risk factors for undergoing different-day procedures. Micropolitan location (aOR, 0.94; 95% CI, 0.92-0.96) and rural location (aOR, 0.91; 95% CI, 0.89-0.93), more comorbidities (≥5: aOR, 0.75; 95% CI, 0.74-0.76), physician's fewer years in practice (aOR, 0.84; 95% CI, 0.81-0.87), physician's higher procedure volume (aOR, 0.65; 95% CI, 0.62-0.68), and physician's specialty of general surgery (aOR, 0.86; 95% CI, 0.80-0.91) were protective factors. Conclusions and Relevance: Physician offices and ASCs had much higher different-day procedure rates compared with HOPDs. This disparity may represent an opportunity for quality improvement and financial savings for common endoscopic procedures.

Medicare Program: Changes to Hospital Outpatient Prospective Payment and Ambulatory Surgical Center Payment Systems and Quality Reporting Programs. Final rule with comment period.

This final rule with comment period revises the Medicare hospital outpatient prospective payment system (OPPS) and the Medicare ambulatory surgical center (ASC) payment system for CY 2019 to implement changes arising from our continuing experience with these systems. In this final rule with comment period, we describe the changes to the amounts and factors used to determine the payment rates for Medicare services paid under the OPPS and those paid under the ASC payment system. In addition, this final rule with comment period updates and refines the requirements for the Hospital Outpatient Quality Reporting (OQR) Program and the ASC Quality Reporting (ASCQR) Program. In addition, we are updating the Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS) Survey measure under the Hospital Inpatient Quality Reporting (IQR) Program by removing the Communication about Pain questions; and retaining two measures that were proposed for removal, the Catheter-Associated Urinary Tract Infection (CAUTI) Outcome Measure and Central Line-Associated Bloodstream Infection (CLABSI) Outcome Measure, in the PPS-Exempt Cancer Hospital Quality Reporting (PCHQR) Program beginning with the FY 2021 program year.

Evaluation of Factors Driving Cost Variation for Distal Radius Fracture Open Reduction Internal Fixation.

PURPOSE: Distal radius fracture open reduction and internal fixation (ORIF) represents a considerable cost burden to the health care system. We aimed to elucidate demographic-, injury-, and treatment-specific factors influencing surgical encounter costs for distal radius ORIF. METHODS: We retrospectively reviewed adult patients treated with isolated distal radius ORIF between November 2014 and October 2016 at a single tertiary academic medical center. Using our institution's information technology value tools-which allow for comprehensive payment and cost data collection and analysis on an item-level basis-we determined relative costs (RC) for each factor potentially influencing total direct costs (TDC) for distal radius ORIF using univariate and multivariable gamma regression analyses. RESULTS: Of the included 108 patients, implants and facility utilization costs were responsible for 48.3% and 37.9% of TDC, respectively. Factors associated with increased TDC include plate manufacturer (RC 1.52 for the most vs least expensive manufacturer), number of screws (RC 1.03 per screw) and distal radius plates used (RC 1.67 per additional plate), surgery setting (RC 1.32 for main hospital vs ambulatory surgery center), treating service (RC 1.40 for trauma vs hand surgeons), and surgical time (RC 1.04 for every 10 min of additional surgical time). Open fracture was associated with increased costs (RC 1.55 vs closed fracture), whereas other estimates of fracture severity were nonsignificant. In the multivariable model controlling for injury-specific factors, variables including implant manufacturer, and number of distal radius plates and screws used, remained as significant drivers of TDC. CONCLUSIONS: Substantial variations in surgical direct costs for distal radius ORIF exist, and implant choice is the predominant driver. Cost reductions may be expected through judicious use of additional plates and screws, if hospital systems use bargaining power to reduce implant costs, and by efficiently completing surgeries. CLINICAL RELEVANCE: This study identifies modifiable factors that may lead to cost reduction for distal radius ORIF.

Our Surgical Experience: Open Versus Endoscopic Carpal Tunnel Surgery.

Carpal tunnel release is one of the most common hand operations in the United States and every year approximately 500,000 patients undergo surgical release. In this article, we examine the argument for endoscopic carpal tunnel release versus open carpal tunnel release, as well as some of the literature on anatomical variants in the median nerve at the wrist. We further describe the experience of several surgeons in a large academic practice. The goals of this article are to describe key anatomic findings and to present several cases that have persuaded us to favor offering patients open carpal tunnel release.

The Impact of Price Transparency for Surgical Services.

Increasing insurance deductibles have prompted some medical centers to initiate transparent pricing. However, the impact of price transparency (PT) on surgical volume, revenue, and patient satisfaction is unknown, along with the barriers to achieving PT. We identified ambulatory surgical centers in the Free Market Medical Association database that publicly list prices for surgical services online. Six of eight centers (75%) responded to our data collection inquiry. Among five centers that reported their patient volume and revenue after adopting PT, patient volume increased by a median of 50 per cent (range 10-200%) at one year. Four centers (80%) reported an increase in revenue by a median of 30 per cent (range 4-75%), whereas three centers (60%) experienced an increase in third-party administrator contracts with the average increase being seven new third-party administrator contracts (range = 2-12 contracts). Three centers (50%) reported a reduction in their administrative burden and five centers (83%) reported an increase in patient satisfaction and patient engagement after PT. The leading barrier reported to making prices transparent was discouragement from another practice, hospital, or insurance company. The findings of this preliminary study may help guide medical practices in designing and implementing PT strategies.

Understanding Costs of Care in the Operating Room.

Importance: Increasing value requires improving quality or decreasing costs. In surgery, estimates for the cost of 1 minute of operating room (OR) time vary widely. No benchmark exists for the cost of OR time, nor has there been a comprehensive assessment of what contributes to OR cost. Objectives: To calculate the cost of 1 minute of OR time, assess cost by setting and facility characteristics, and ascertain the proportion of costs that are direct and indirect. Design, Setting, and Participants: This cross-sectional and longitudinal analysis examined annual financial disclosure documents from all comparable short-term general and specialty care hospitals in California from fiscal year (FY) 2005 to FY2014 (N = 3044; FY2014, n = 302). The analysis focused on 2 revenue centers: (1) surgery and recovery and (2) ambulatory surgery. Main Outcomes and Measures: Mean cost of 1 minute of OR time, stratified by setting (inpatient vs ambulatory), teaching status, and hospital ownership. The proportion of cost attributable to indirect and direct expenses was identified; direct expenses were further divided into salary, benefits, supplies, and other direct expenses. Results: In FY2014, a total of 175 of 302 facilities (57.9%) were not for profit, 78 (25.8%) were for profit, and 49 (16.2%) were government owned. Thirty facilities (9.9%) were teaching hospitals. The mean (SD) cost for 1 minute of OR time across California hospitals was $37.45 ($16.04) in the inpatient setting and $36.14 ($19.53) in the ambulatory setting (P = .65). There were no differences in mean expenditures when stratifying by ownership or teaching status except that teaching hospitals had lower mean (SD) expenditures than nonteaching hospitals in the inpatient setting ($29.88 [$9.06] vs $38.29 [$16.43]; P = .006). Direct expenses accounted for 54.6% of total expenses ($20.40 of $37.37) in the inpatient setting and 59.1% of total expenses ($20.90 of $35.39) in the ambulatory setting. Wages and benefits accounted for approximately two-thirds of direct expenses (inpatient, $14.00 of $20.40; ambulatory, $14.35 of $20.90), with nonbillable supplies accounting for less than 10% of total expenses (inpatient, $2.55 of $37.37; ambulatory, $3.33 of $35.39). From FY2005 to FY2014, expenses in the OR have increased faster than the consumer price index and medical consumer price index. Teaching hospitals had slower growth in costs than nonteaching hospitals. Over time, the proportion of expenses dedicated to indirect costs has increased, while the proportion attributable to salary and supplies has decreased. Conclusions and Relevance: The mean cost of OR time is $36 to $37 per minute, using financial data from California's short-term general and specialty hospitals in FY2014. These statewide data provide a generalizable benchmark for the value of OR time. Furthermore, understanding the composition of costs will allow those interested in value improvement to identify high-yield targets.

Physician Reimbursement for Prostate Biopsies Falls as Procedures Shift From Offices to Facilities.

OBJECTIVE: To examine how Medicare reimbursement for prostate biopsies was allocated to physicians, ambulatory surgery centers (ASCs), and hospitals from 2012 to 2015. MATERIALS AND METHODS: Using Medicare Provider Utilization and Payment Data (2012-2015), we assessed provider payments to physicians and ASCs for transrectal ultrasound-guided prostate biopsies (Current Procedural Terminology 55700, 76842, 76972) for fee-for-service Medicare beneficiaries. Data were aggregated at provider-level for those reporting >10 biopsies per year. Hospital payments were estimated based on Outpatient Prospective Payment System. We report average and total payments for physicians, hospitals, and ASCs. RESULTS: We identified 534,807 prostate biopsies, of which 13.3% and 14.8% were associated with an ASC and hospital, respectively. Payments for all biopsies totaled $276.7 million ($152.7 million to physicians; $35.1 million to ASCs, $88.9 million to hospitals). From 2012 through 2015, physician payments for biopsies declined by $19 million (Δ=-43.2%, P = .06 for trend). Payments to ASCs (+$3.2 million, Δ = 38.8%, P = .29) and hospitals (+$11.1 million, Δ = 58.6%, P = .16) both increased. The decline in physician payments was due to a 13.7% decline in volume and lower median reimbursement for office-based procedures ($415 to $277, P = .04). The share of biopsies performed at facilities increased from 26.5% to 30.0%, and the proportion of payments associated with those settings also increased from 42.7% to 65.3%. CONCLUSION: Over time, a greater share of Medicare payments for biopsies has been directed toward facilities instead of physicians. Understanding the relationship between these trends and cancer screening and Medicare payment policies will be crucial in the future.

Specialization and production cost efficiency: evidence from ambulatory surgery centers.

In the U.S. health care sector, the economic logic of specialization as an organizing principle has come under active debate in recent years. An understudied case is that of ambulatory surgery centers (ASCs), which recently have become the dominant provider of specific surgical procedures. While the majority of ASCs focus on a single specialty, a growing number are diversifying to offer a wide range of surgical services. We take a multiple output cost function approach to an empirical investigation that compares production economies in single specialty ASCs with those in multispecialty ASCs. We applied generalized estimating equation techniques to a sample of Pennsylvania ASCs for the period 2004-2014, including 73 ASCs that specialized in gastrointestinal procedures and 60 ASCs that performed gastrointestinal as well as other specialty procedures. Results indicated that both types of ASC had small room for expansion. In simulation analysis, production of GI services in specialized ASCs had a cost advantage over joint production of GI with other specialty procedures. Our results provide support for the focused factory model of production in the ASC sector.

Medicare Program: Hospital Outpatient Prospective Payment and Ambulatory Surgical Center Payment Systems and Quality Reporting Programs; Organ Procurement Organization Reporting and Communication; Transplant Outcome Measures and Documentation Requirements; Electronic Health Record (EHR) Incentive Programs; Payment to Nonexcepted Off-Campus Provider-Based Department of a Hospital; Hospital Value-Based Purchasing (VBP) Program; Establishment of Payment Rates Under the Medicare Physician Fee Schedule for Nonexcepted Items and Services Furnished by an Off-Campus Provider-Based Department of a Hospital. Final rule with comment period and interim final rule with comment period.

This final rule with comment period revises the Medicare hospital outpatient prospective payment system (OPPS) and the Medicare ambulatory surgical center (ASC) payment system for CY 2017 to implement applicable statutory requirements and changes arising from our continuing experience with these systems. In this final rule with comment period, we describe the changes to the amounts and factors used to determine the payment rates for Medicare services paid under the OPPS and those paid under the ASC payment system. In addition, this final rule with comment period updates and refines the requirements for the Hospital Outpatient Quality Reporting (OQR) Program and the ASC Quality Reporting (ASCQR) Program. Further, in this final rule with comment period, we are making changes to tolerance thresholds for clinical outcomes for solid organ transplant programs; to Organ Procurement Organizations (OPOs) definitions, outcome measures, and organ transport documentation; and to the Medicare and Medicaid Electronic Health Record Incentive Programs. We also are removing the HCAHPS Pain Management dimension from the Hospital Value-Based Purchasing (VBP) Program. In addition, we are implementing section 603 of the Bipartisan Budget Act of 2015 relating to payment for certain items and services furnished by certain off-campus provider-based departments of a provider. In this document, we also are issuing an interim final rule with comment period to establish the Medicare Physician Fee Schedule payment rates for the nonexcepted items and services billed by a nonexcepted off-campus provider-based department of a hospital in accordance with the provisions of section 603.

Cost Savings From Utilization of an Ambulatory Surgery Center for Orthopaedic Day Surgery.

INTRODUCTION: Healthcare providers are increasingly searching for ways to provide cost-efficient, high-quality care. Previous studies on evaluating cost used estimated cost-to-charge ratios, which are inherently inaccurate. The purpose of this study was to quantify actual direct cost savings from performing pediatric orthopaedic sports day surgery at an ambulatory surgery center (ASC) compared with a university-based children's hospital (UH). METHODS: Custom-scripted accounting software was queried for line-item costs for a period of 3 fiscal years (fiscal year 2012 to fiscal year 2014) for eight day surgery procedures at both a UH and a hospital-owned ASC. Hospital-experienced direct costs were compared while controlling for surgeon, concomitant procedures, age, sex, and body mass index. RESULTS: One thousand twenty-one procedures were analyzed. Using multiple linear regression analysis, direct cost savings at the ASC ranged from 17% to 43% for seven of eight procedures. Eighty percent of the cost savings was attributed to time (mean, 64 minutes/case; P < 0.001) and 20% was attributed to supply utilization (P < 0.001). Of the time savings in the operating room, 73% (mean, 47 minutes; P < 0.001) was attributed to the surgical factors whereas 27% (17 minutes; P < 0.001) was attributed to anesthesia factors. CONCLUSIONS: Performing day surgery at an ASC, compared with a UH, saves 17% to 43% from the hospital's perspective, which was largely driven by surgical and anesthesia-related time expenditures in the operating room. LEVEL OF EVIDENCE: Level II.

A population-based analysis of the drivers of short-term costs after bariatric surgery within a publicly funded regionalized center of excellence system.

BACKGROUND: The most significant driver of healthcare utilization for bariatric surgery is the index admission and readmissions within the first 30 days after a procedure. Identifying areas to create efficiencies during this period is essential to decreasing overall healthcare costs. OBJECTIVE: The objective of the study was to characterize the short-term costs of bariatric surgery within a regionalized center of excellence bariatric care system. SETTING: The Ontario Bariatric Network is a regionalized bariatric care system with 4 high-volume Bariatric Centers of Excellence. METHODS: We performed a population-based retrospective analysis including all adult patients who received a bariatric surgical procedure in Ontario from April 2009 until March 2012. Total hospital cost and number of days in hospital was calculated for all index admissions and all readmissions within 30 days of a bariatric surgical procedure. An inverse Gaussian generalized linear model was utilized to model the effect of covariates on costs. A Poisson regression was used to determine the effect on covariates on total days in hospital. RESULTS: After multivariable adjustment, the sleeve gastrectomy procedure decreased costs by $1447 over gastric bypass (95% confidence interval [CI] $1578 to-$1315]); P<.001). This effect increased when adjusting only for preoperative factors with a cost savings of nearly $2000 ($1953) (95% CI-$3250 to-$533; P = .003). Conversely, complications were the major drivers of increased cost as anastomotic leaks added $24,397 (95% CI $20,688-$28,106; P<.001) to healthcare costs. In addition, medical complications, such as respiratory failure/infection ($19,465) (95% CI $11,007-$27,924; P<.001), were also significant cost drivers. CONCLUSION: Major drivers of increased resource utilization included major surgical and medical complications, such as anastomotic leaks and respiratory failure/infection. Days in hospital were affected more by medical complications than surgical complications. Sleeve gastrectomy resulted in a clear short-term cost advantage over Roux-en-Y gastric bypass (RYGB), and this was likely related to the procedure itself as opposed to differences across procedures in co-morbidity and complication rates.