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When Patients Have to Pay the Difference, They Choose Less Expensive ASCs for Care

Study shows the value of reference-based insurance.

Published: September 15, 2015

The more financial responsibility patients share with their insurers, and the more they understand the disparity in prices charged by freestanding ambulatory surgery centers and hospital-based outpatient facilities, the more likely they are to choose less-expensive ASCs for orthopedic surgery, a new study finds. Patients who choose ASCs, the study finds further, do not have more complications.

The study, which appears in the Journal of Bone & Joint Surgery, examined the impact of a reference-based insurance plan adopted by the California Public Employees' Retirement System (CalPERS) in 2012. Under such a plan, patients are responsible for the difference between a payer's fixed contribution for a given procedure and the provider's ultimate charge.

The authors compared the choices made by orthopedic patients insured under the CalPERS plan to choices made by orthopedic patients covered by Anthem Blue Cross, who were not subject to reference-based benefits, while adjusting for demographics, comorbidities and geographic location.

By the second year of the new CalPERS program, the number of participants choosing ASCs had risen by 14.3% for knee arthroscopy and by 9.9% for shoulder arthroscopy, with a resulting savings of 17.6% for knees and 17.0% for shoulders. Those translate to an overall savings of $2.3 million, say the authors.

Price transparency, quality measurements that include patient-reported outcomes, and mechanisms to encourage shared decision-making with physicians are all key drivers, say the authors.

"In much of the non-health economy, the value of a product or service is the amount that the consumer is willing to pay for it, given the consumer's expectations of performance," they add. "This definition of value now is being applied to musculoskeletal health care as well."

Jim Burger


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