Study: Outpatient surgery costs hinge on site of care, network status

Editor's Note

Patients and insurers pay far less for outpatient surgical procedures performed at in-network ambulatory surgery centers (ASCs) than at hospital outpatient departments (HOPDs), the American Journal of Managed Care October 6 reports. This study, led by Xiaoxi Zhao, PhD, Christopher Whaley, PhD, and colleagues, analyzed commercial claims data across all 50 states to assess how site of care and network status drive costs for common procedures.

The researchers examined nearly 225,000 surgical procedures, focusing on arthroscopy, cataract, colonoscopy, and upper gastrointestinal procedures. Results revealed a consistent pattern: ASCs offered the lowest prices, while HOPDs carried the highest. Compared with an in-network ASC, insurer payments averaged $306 more at an out-of-network ASC, $1,042 more at an in-network HOPD, and $1,041 more at an out-of-network HOPD. For patients, in-network ASCs were the most affordable. Out-of-pocket spending rose by $186 at in-network HOPDs and soared more than 300% at out-of-network facilities.

The study also found that site of care often mattered more than network status. Even out-of-network ASCs were less expensive than in-network HOPDs. This reflects the large facility fee differences between the two settings, which drive much of the price gap. For insurers, shifting more procedures to ASCs consistently reduced spending, regardless of network arrangements.

These findings align with prior research showing that directing procedures to ASCs lowers spending without harming quality. Employers and health plans have experimented with strategies to steer patients accordingly, including reference pricing and tiered networks. Programs by CalPERS, Massachusetts’ Group Insurance Commission, and Minnesota’s State Employee Group Insurance Program have successfully saved money by encouraging ASC use, the article notes.

Still, challenges remain. Narrow networks may expose patients to higher costs if they inadvertently use out-of-network providers. Although federal protections limit surprise billing in emergencies, scheduled outpatient procedures at out-of-network sites are often excluded. The authors suggested insurers and plan sponsors could curb costs by expanding ASC networks and lowering patient cost-sharing for ASC care, aligning incentives to maximize savings for both patients and insurers.