Search Results

Publisher/Organization: FTI Consulting

Payer: Medicare

Summary: The brief analyzes the potential impact on community hospitals of applying site-neutral payment policies to 57 ambulatory payment classifications that MedPAC’s 2023 report identified as safe and routinely provided in physician offices or ambulatory surgical centers. Authors report that site-neutral reforms could reduce Medicare payments to hospitals by about $182 billion over ten years, including $26.3 billion to rural hospitals. Many hospitals could face financial distress and cuts may disproportionately affect emergency, maternal, and mental health service lines. The report notes that hospitals already operate under significant financial and workforce challenges, and further payment reductions could impair hospitals’ ability to sustain access to essential services in vulnerable communities.

Topic Areas: Site-Neutrality, Patients & Quality, Policy Reforms

Publisher/Organization: KNG Health Consulting

Payer: Medicare

Summary: Using Medicare claims data from 2019 to 2024, the authors compare patients treated in hospital outpatient departments (HOPDs) and independent physician offices. The analysis finds that HOPD patients are more likely to be under 65 and disabled, dually eligible for Medicare and Medicaid, from lower-income and rural areas, and have more severe chronic conditions and higher prior use of hospital and emergency services. These differences suggest that HOPDs treat a sicker, higher-need population, which may justify higher payments in these settings.

Topic Areas: Patients & Quality

Publisher/Organization: KNG Health Consulting

Payer: Medicare

Summary: Using Medicare claims data from 2019 to 2024, authors compared the characteristics of patients with cancer receiving care in hospital outpatient departments (HOPDs) to patients in independent physician offices. The analysis finds that patients treated in HOPDs are more likely to be under age 65 and disabled, dually eligible for Medicare and Medicaid, from lower-income or rural communities, and have more severe chronic conditions and higher prior use of hospital and emergency services. These findings indicate that differences in patient mix and complexity may help explain why care in hospitals is often more expensive.

Topic Areas: Patients & Quality

Publisher/Organization: Yale Tobin Center for Economic Policy

Payer: Commercial Insurance

Summary: The study looks at hospital merger data and commercial claims data for labor and delivery from 2011-2016. In the two years after integration, hospital prices for labor and delivery increased on average by 3.3% ($475), while physician prices rose by 15.1% ($502). The researchers find no significant improvements in quality that might justify the price increases, In fact, they observed an increase of 4.5-8.0% in cesarean section rates, which are often considered a sign of physician-induced demand rather than improved care. Across specialties, the share of physicians integrated with a hospital also increased by 71.5% from 2008 to 2016.

Topic Areas: Vertical Integration, Patients & Quality

Publisher/Organization: N/A

Payer: Commercial Insurance, Medicare

Summary: This survey study of 1,069 clinicians in 2021, combined with 2019 claims data, assesses how much care delivered in hospital settings could be shifted to lower-cost care sites without compromising clinical outcomes. Respondents evaluated more than 300 care activities and indicated that about 10.3% of commercial care volume and 10.9% of Medicare volume in hospital settings could safely occur elsewhere. Based on 2019 reimbursement rates, shifting this care would be associated with annual savings of approximately $113.8 billion to $147.7 billion for the overall health care system.

Topic Areas: Payment Differentials, Patients & Quality

Publisher/Organization: N/A

Payer: Commercial Insurance

Summary: This study analyzes the volume and prices of colonoscopy, knee or shoulder arthroscopy, and cataract removal in hospital outpatient departments (HOPDs) and ambulatory surgery centers (ASCs). Using national commercial claims data from Blue Cross Blue Shield insurance plans in 2019-2020, the researchers find the average volume of the procedures were 44-134% higher in ASCs compared to HOPDs. Additionally, prices paid for the services in HOPDs were 44-55% higher than in ASCs. Complications within 90 days of the procedures were more common for procedures in HOPDs for colonoscopy and similar across settings for arthroscopy and cataract removal.

Topic Areas: Payment Differentials, Patients & Quality

Publisher/Organization: Yale Tobin Center for Economic Policy

Payer: Medicare

Summary: The review synthesizes literature on Medicare’s site-neutral payment policies. It shows that payment differences for the same outpatient services across hospitals, ambulatory surgical centers, and physician offices increase spending and beneficiary costs. Eliminating these differences could lower costs without harming quality. The authors find that payment differentials have encouraged hospital-physician vertical integration, but peer-reviewed evidence has shown that hospital-based care does not yield better patient outcomes for comparable services. Because commercial payers often follow Medicare’s lead, these payment disparities extend into the commercial insurance market. The review also discusses site-neutral policies and proposals as of 2023.

Topic Areas: Payment Differentials, Vertical Integration, Policy Reforms, Site-Neutrality, Patients & Quality

Publisher/Organization: KNG Health Consulting

Payer: Medicare

Summary: Using a five percent sample of Medicare fee-for-service claims from 2019-2021, the report finds that beneficiaries treated in hospital outpatient departments (HOPDs) have substantially different characteristics than those seen in independent physician offices or ambulatory surgical centers (ASCs). HOPD patients are more likely to be dually eligible for Medicare and Medicaid, have lower incomes, identify as non-white race/ethnicity, qualify for Medicare due to disability or end-stage renal disease, and have higher clinical complexity and prior hospital and emergency department utilization. The authors observe similar patterns when comparing HOPDs to ASCs, indicating that HOPDs serve sicker and higher-need populations. These differences in patient mix and complexity suggest that care costs and resource requirements vary by setting.

Topic Areas: Patients & Quality

Publisher/Organization: MedPAC

Payer: Medicare

Summary: The analysis evaluates Medicare’s Outpatient Prospective Payment System (OPPS) and identifies opportunities for site-neutral payment across ambulatory payment classifications (APCs). It finds that for 57 APCs, it would be reasonable to align payments across hospital outpatient departments (HOPDs), ambulatory surgery centers (ASCs), and physician offices at the physician fee schedule (PFS) rate; for eleven APCs, HOPD and ASC payments could be aligned to ASC rates while physician offices remain at PFS levels; and for 101 APCs, differential payments are likely appropriate because HOPDs are the most suitable setting. While acknowledging that HOPDs incur higher costs due to requirements such as maintaining standby emergency capacity, the authors find little evidence that patients receiving the services examined are systematically more complex or sicker in hospital settings. They suggest that higher-acuity services—such as emergency department, critical care, and trauma visits—may warrant distinct payment categories.

Topic Areas: Site-Neutrality, Patients & Quality, Policy Reforms

Publisher/Organization: N/A

Payer: Commercial Insurance

Summary: This study analyzes 2018 commercial claims data to compare payments for outpatient services across sites of care. It finds that total payments, including facility and professional fees, were on average 145% higher in hospital outpatient departments (HOPDs) than in physician offices. Price differences between settings were highest for pathology and laboratory services. It also finds that patient out-of-pocket spending was 109% higher in HOPDs. Additionally, patients treated in HOPDs had higher risk scores and received more same-day services. However, it is unclear whether this reflects true differences in patient complexity or coding practices.

Topic Areas: Payment Differentials, Patients & Quality

Publisher/Organization: N/A

Payer: N/A

Summary: By analyzing 29 hospital quality measures from the Centers for Medicare & Medicaid Services Hospital Compare data from 2008 to 2015, the study assesses the effects of vertical integration and market concentration on quality of care. It finds that integration between hospitals and physicians has limited or no consistent impact on most quality measures. In contrast, greater hospital market concentration is associated with declines in all ten patient satisfaction measures.

Topic Areas: Vertical Integration, Patients & Quality