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Does procedure profitability impact whether an outpatient surgery is performed at an ambulatory surgery center or hospital?

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  • Michael Robert Plotzke
  • Charles Courtemanche

Abstract

Ambulatory surgery centers (ASCs) are small (typically physician owned) healthcare facilities that specialize in performing outpatient surgeries and therefore compete against hospitals for patients. Physicians who own ASCs could treat their most profitable patients at their ASCs and less profitable patients at hospitals. This paper asks if the profitability of an outpatient surgery impacts where a physician performs the surgery. Using a sample of Medicare patients from the National Survey of Ambulatory Surgery, we find that higher profit surgeries do have a higher probability of being performed at an ASC compared to a hospital. After controlling for surgery type, a 10% increase in a surgery's profitability is associated with a 1.2 to 1.4 percentage point increase in the probability the surgery is performed at an ASC. Copyright © 2010 John Wiley & Sons, Ltd.

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  • Michael Robert Plotzke & Charles Courtemanche, 2011. "Does procedure profitability impact whether an outpatient surgery is performed at an ambulatory surgery center or hospital?," Health Economics, John Wiley & Sons, Ltd., vol. 20(7), pages 817-830, July.
    • Handle: RePEc:wly:hlthec:v:20:y:2011:i:7:p:817-830
    DOI: 10.1002/hec.1646
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    Cited by:

    1. Ge, Ge & Cheo, Roland & Liu, Rugang & Wang, Jian & Wang, Qiqi, 2023. "Physician beneficence and profit-taking among private for profit clinics in China: A field study using a mystery shopper audit," HERO Online Working Paper Series 2023:6, University of Oslo, Health Economics Research Programme.
    2. Richards, Michael R. & Seward, Jonathan A. & Whaley, Christopher M., 2022. "Treatment consolidation after vertical integration: Evidence from outpatient procedure markets," Journal of Health Economics, Elsevier, vol. 81(C).
    3. Cheo, Roland & Ge, Ge & Liu, Rugang & Wang, Jian & Wang, Qiqi, 2023. "Physician beneficence and profit-taking among private for-profit clinics in China: A field study using a mystery shopper audit," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 107(C).
    4. Geruso, Michael & Richards, Michael R., 2022. "Trading spaces: Medicare's regulatory spillovers on treatment setting for non-Medicare patients," Journal of Health Economics, Elsevier, vol. 84(C).
    5. Munnich, Elizabeth L. & Parente, Stephen T., 2018. "Returns to specialization: Evidence from the outpatient surgery market," Journal of Health Economics, Elsevier, vol. 57(C), pages 147-167.
    6. Trybou, Jeroen & De Regge, Melissa & Gemmel, Paul & Duyck, Philippe & Annemans, Lieven, 2014. "Effects of physician-owned specialized facilities in health care: A systematic review," Health Policy, Elsevier, vol. 118(3), pages 316-340.
    7. Walter Beckert & Elaine Kelly, 2021. "Divided by choice? For‐profit providers, patient choice and mechanisms of patient sorting in the English National Health Service," Health Economics, John Wiley & Sons, Ltd., vol. 30(4), pages 820-839, April.
    8. Aouad, Marion & Brown, Timothy T. & Whaley, Christopher M., 2019. "Reference pricing: The case of screening colonoscopies," Journal of Health Economics, Elsevier, vol. 65(C), pages 246-259.
    9. Thomas Stratmann & Markus Bjoerkheim & Christopher Koopman, 2024. "The Causal Effect of Repealing Certificate-of-Need Laws for Ambulatory Surgical Centers: Does Access to Medical Services Increase?," Papers 2405.08160, arXiv.org.

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