Repricing Specialty Hospital Outpatient Services Using Ambulatory Surgery Center Prices

This article explores whether Medicare pays more for the same outpatient services provided in an acute specialty hospital than in an ambulatory surgery center (ASC). How financially dependent a specialty hospital is on ASC-eligible services is also investigated. Medicare outpatient claims in 43 orthopedic and 12 surgical specialty hospitals in 2004 were repriced using ASC pricing software. Payments for the same surgical procedure were 43 and 64 percent higher in specialty surgical and orthopedic outpatient departments, respectively, compared with simulated ASC payments. Non-ASC-eligible outpatient services were 18-35 percent of all Medicare outpatient payments varying by type of specialty hospital.