Physician-Ownership Of Ambulatory Surgery Centers Linked To Higher Volume Of Surgeries

Abstract

Many physicians confronting declining reimbursement from insurers have invested in ambulatory surgery centers, where they perform outpatient surgical and diagnostic procedures. An ownership stake entitles physicians to a share of the facility's profits from self-referrals. This arrangement can create a potential conflict of interest between physicians' financial incentives and patients' clinical needs. Our analysis of Florida data for five common procedures revealed a significant association between physician-ownership and higher surgical volume. Possible remedies include revising federal law to require disclosure of investment arrangements; reducing facility payments to dilute ownership incentives; and reforms (such as accountable care organizations) that discourage an excessive rate of procedures.

Does competition from ambulatory surgical centers affect hospital surgical output?

“…They find, however, that profitability is only one of many factors that affect surgery location decisions, with patient health and procedure complexity being potentially more important. 3 Most recently, Hollingsworth et al (2010) used Florida data to show that physicians with an ownership stake in an ASC performed significantly more surgeries than other physicians. The authors pointed to financial incentives as a possible explanation.…”

Physicians on board: An examination of physician financial interests in ASCs using longitudinal data

“…Previous studies often proxy financial interests by defining physician owners as those who refer above a minimum threshold of their patients to an ASC or a physician-owned entity (e.g. Hollingsworth et al, 2010;Mitchell, 2005;Gabel et al, 2008).…”

Selective Hearing: Physician-Ownership and Physicians' Response to New Evidence

“…Research on physician ownership of surgery centers (Hollenbeck et al 2010;Hollingsworth et al 2010a;2010b;Mitchell 2010), cardiac hospitals (Barro et al 2006;Mitchell 2005;2008, Nallamothu et al 2007), imaging centers (Baker 2010;Shreibati and Baker 2012) and pharmacy services (Iizuka 2007;2012) has generally confirmed the hypothesis that ownership is associated with increased use of health care services. A limitation of most of these studies is that, in the absence of a benchmark for the optimal level of use, it is impossible to assess the impact of alternative practice arrangements on consumer welfare.…”

“…Before 2002, several small randomized trials of debridement (Merchan et al 1993) and lavage (Ike et al 1992) found that these therapies reduced knee pain. Knee arthroscopy was a well-accepted, Hollingsworth et al (2010a) to distinguish between owners and non-owners. The data include surgeon identifiers, but these cannot be linked over time, hence our focus on facility-level analyses.…”