Viewpoint

HOPD-ASC gap: Is anyone listening?

FROM THE CHIEF MEDICAL EDITOR Larry E. Patterson, MD

Many of us are aware of a rather perverse payment disparity between hospital outpatient departments (HOPDs) and ambulatory surgery centers (ASCs). As I’ve noted in the past (Viewpoint, March 2012), and as Michael Romansky, JD, of the Outpatient Ophthalmic Surgery Society, has noted on several occasions, this is a problem that continues to grow as the gap between Medicare payments to HOPDs and ASCs widens.

This gap has become so great that hospitals now are buying ASCs and converting them into HOPDs to make more money. How much more? Let’s say you did cataract surgery on a patient’s right eye this Wednesday in a surgery center, and the facility got $971. The next day, the hospital acquires said center, and the following week you do the same patient’s left eye, at the exact same surgery center. But now the facility gets $1,730! I’m not that great at math, but my calculator is amazing. That’s a 78% percent increase!

And in case you think this is only about the facilities, be aware that it also directly affects patients, especially those without supplemental insurance. The HOPD coinsurance in the example above is $346, while the ASC’s is only $194. That is a price increase of $152 for the patient who had the exact same surgery in the exact same facility.

What causes me to revisit this subject is a new report from the University of California, Berkeley – not exactly a bastion of right-wing thinking – entitled Medicare Savings Tied to Ambulatory Surgery Centers. The article opens saying: “Even in today’s divisive political environment, there’s at least one important area of consensus among policy makers: the threat posed by rising health care costs to both our national economy and the federal and state governments’ balance sheets.” It notes that on average, Medicare reimburses ASCs a mere 58% of the rate it reimburses HOPDs, and that the more than 5,300 ASCs in this country provide identical services to HOPDs.

The report’s cost savings analysis has some rather dramatic numerical conclusions:

• Between 2008 and 2011, ASCs saved Medicare and our patients $7.5 billion.

• If everything stays exactly the same for the next 10 years, ASCs will save Medicare $32.5 billion more.

• If the ASC Medicare share increases even slightly, the savings could exceed $57 billion in the next decade.

• The above estimates are “quite conservative” according to the report.

What can be done? To begin with, get the word out, however you can, about this ridiculous payment inequity. A first step would be to get your elected representatives to support the bipartisan ASC Quality and Access Act of 2013 (HR 2500/S 1137). This bill would direct CMS to provide our ASCs with the same annual updates as hospitals. As it is now, the gap continues to slowly widen each year.

As an aside, our editorial staff here has tried getting this news out to a wider audience, including “60 Minutes” and the New York Times. So far, no takers. Sounds like a great story to me. Steve Kroft, Lesley Stahl, are you listening? OM