ASCs Save Medicare $464 Million Annually

From Becker's ASC Review:

An independent report on Pennsylvania's ASCs has turned up some interesting statistics. The report, entitled Financial Analysis 2006, Volume Two, reported a total of 205 licensed ASC facilities in the state with 28 facilities having opened between June 2006 and May 2007. The report also indicated a 17-point increase in the number of outpatient diagnostic and surgical (D&S) procedures over a six-year period. In 2006, ASCs performed 622,652 of the total 2.3 million outpatient D&S procedures in the state.

"The continued growth of ambulatory surgery centers demonstrates that there is a need ... for alternative, low-cost, high-quality outpatient surgical services within our communities," says Rick Bloxdorf, the president of the Pennsylvania Ambulatory Surgery Association and administrator for Village SurgiCenter of Erie, Pa. The following statistics bear this out, he says:

Payers save money. Medicare payment to ASCs for high-volume procedures is lower than Medicare payment to outpatient department of hospitals for the same procedures. In 2008 the difference will be 37 percent. Studies have shown the Medicare program would pay approximately $464 million per year more if all procedures performed in an ASC were instead furnished at a hospital.

Consumers save money. A Medicare beneficiary could pay as much as $496 in co-insurance for a cataract extraction procedure performed in a hospital outpatient department, whereas the maximum out-of-pocket cost for the same beneficiary to receive the service in an ASC is $195. Likewise, a Medicare beneficiary could pay as much as $186 in coinsurance for a colonoscopy performed in an outpatient department of hospital but only $89 if they had the procedure in an ASC.

Employers often achieve similar savings when their employees choose ASCs as the Medicare program does for its beneficiaries. Reimbursement from private insurers for the same outpatient surgical procedures performed in an ASC setting is lower than in an outpatient hospital setting. As in Medicare, both the insurance company and the patient pass less for their care if they use an ASC.

The report is the product of the Pennsylvania Health Care Cost Containment Council, an independent state agency charged with collecting, analyzing, and reporting information that can be used to improve the quality and restrain the cost of healthcare in Pennsylvania. In addition to ASCs, the report also includes data representing the financial health of other non-general acute care facilities, including long-term acute care, rehabilitation, psychiatric, and specialty hospitals. Copies of the report are available

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