IDEAS home Printed from https://ideas.repec.org/a/wly/hlthec/v20y2011i7p817-830.html
   My bibliography  Save this article

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

Author

Listed:
  • 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.

Suggested Citation

  • 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
    as

    Download full text from publisher

    File URL: https://doi.org/10.1002/hec.1646
    Download Restriction: no
    File URL: https://libkey.io/10.1002/hec.1646?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. repec:mpr:mprres:6029 is not listed on IDEAS
    2. Jon R. Gabel & Cheryl Fahlman & Ray Kang & Gregory Wozniak & Phil Kletke & Joel W. Hay, "undated". "Where Do I Send Thee? Does Physician-Ownership Affect Referral Patterns to Ambulatory Surgery Centers," Mathematica Policy Research Reports a82b3232352c4cea8e8aeb1e5, Mathematica Policy Research.
    3. Yip, Winnie C., 1998. "Physician response to Medicare fee reductions: changes in the volume of coronary artery bypass graft (CABG) surgeries in the Medicare and private sectors," Journal of Health Economics, Elsevier, vol. 17(6), pages 675-699, December.
    4. Barro, Jason R. & Huckman, Robert S. & Kessler, Daniel P., 2006. "The effects of cardiac specialty hospitals on the cost and quality of medical care," Journal of Health Economics, Elsevier, vol. 25(4), pages 702-721, July.
    5. Jonathan Gruber & Maria Owings, 1996. "Physician Financial Incentives and Cesarean Section Delivery," RAND Journal of Economics, The RAND Corporation, vol. 27(1), pages 99-123, Spring.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    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. 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).
    4. 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.
    5. 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.
    6. 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.
    7. 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.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Whaley, Christopher M. & Brown, Timothy T., 2018. "Firm responses to targeted consumer incentives: Evidence from reference pricing for surgical services," Journal of Health Economics, Elsevier, vol. 61(C), pages 111-133.
    2. Currie, Janet & Lin, Wanchuan & Zhang, Wei, 2011. "Patient knowledge and antibiotic abuse: Evidence from an audit study in China," Journal of Health Economics, Elsevier, vol. 30(5), pages 933-949.
    3. Boris Kralj & Jasmin Kantarevic, 2013. "Quality and quantity in primary care mixed-payment models: evidence from family health organizations in Ontario," Canadian Journal of Economics, Canadian Economics Association, vol. 46(1), pages 208-238, February.
    4. Claudia Keser & Claude Montmarquette & Martin Schmidt & Cornelius Schnitzler, 2020. "Custom-made health-care: an experimental investigation," Health Economics Review, Springer, vol. 10(1), pages 1-12, December.
    5. Leemore Dafny & Christopher Ody & Matt Schmitt, 2017. "When Discounts Raise Costs: The Effect of Copay Coupons on Generic Utilization," American Economic Journal: Economic Policy, American Economic Association, vol. 9(2), pages 91-123, May.
    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. Geir Godager & Tor Iversen & Ching-To Ma, 2009. "Service motives and profit incentives among physicians," International Journal of Health Economics and Management, Springer, vol. 9(1), pages 39-57, March.
    8. Lien, Hsien-Ming & Albert Ma, Ching-To & McGuire, Thomas G., 2004. "Provider-client interactions and quantity of health care use," Journal of Health Economics, Elsevier, vol. 23(6), pages 1261-1283, November.
    9. Yoshida, Atsushi & Kawamura, Akira, 2009. "Who has benefited from the health services system for the elderly in Japan?," Japan and the World Economy, Elsevier, vol. 21(3), pages 256-269, August.
    10. Martin Salm & Ansgar Wübker, 2020. "Do hospitals respond to decreasing prices by supplying more services?," Health Economics, John Wiley & Sons, Ltd., vol. 29(2), pages 209-222, February.
    11. Boris Kralj & Jasmin Kantarevic, 2013. "Quality and quantity in primary care mixed‐payment models: evidence from family health organizations in Ontario," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 46(1), pages 208-238, February.
    12. Pierre Azoulay & Ariel Fishman, 2020. "The Rise of For-Profit Experimental Medicine," NBER Working Papers 26892, National Bureau of Economic Research, Inc.
    13. Zhou, Mei & Zhao, Shaoyang & Fu, Mingwei, 2021. "Supply-induced demand for medical services under price regulation: Evidence from hospital expansion in China," China Economic Review, Elsevier, vol. 68(C).
    14. Salm, Martin & Wübker, Ansgar, 2015. "Do hospitals respond to increasing prices by supplying fewer services?," Ruhr Economic Papers 567, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
    15. Fu, Hongqiao & Li, Ling & Yip, Winnie, 2018. "Intended and unintended impacts of price changes for drugs and medical services: Evidence from China," Social Science & Medicine, Elsevier, vol. 211(C), pages 114-122.
    16. Pierre-Thomas Léger & Erin C. Strumpf, 2010. "Système de paiement des médecins : bref de politique," CIRANO Project Reports 2010rp-12, CIRANO.
    17. Beomsoo Kim, 2010. "Do Doctors Induce Demand?," Pacific Economic Review, Wiley Blackwell, vol. 15(4), pages 554-575, October.
    18. Courtemanche, Charles & Plotzke, Michael, 2010. "Does competition from ambulatory surgical centers affect hospital surgical output?," Journal of Health Economics, Elsevier, vol. 29(5), pages 765-773, September.
    19. Qin, Xuezheng & Li, Lixing & Hsieh, Chee-Ruey, 2013. "Too few doctors or too low wages? Labor supply of health care professionals in China," China Economic Review, Elsevier, vol. 24(C), pages 150-164.
    20. Janet Currie & Wanchuan Lin & Juanjuan Meng, 2012. "Using Audit Studies to Test for Physician Induced Demand: The Case of Antibiotic Abuse in China," NBER Working Papers 18153, National Bureau of Economic Research, Inc.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wly:hlthec:v:20:y:2011:i:7:p:817-830. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www3.interscience.wiley.com/cgi-bin/jhome/5749 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.