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Study reveals little cost variation in outpatient settings

Physician Practice Advisor, November 8, 2006

A new study reveals little difference between the cost and quality of three different procedures when performed at hospital outpatient departments, ambulatory surgery centers and doctor's offices, according to a report from Medicare Payment Advisory Committee (MedPAC).

The study, commissioned by MedPAC and conducted by RAND Health, examined whether the type of setting affected the characteristics of the patients and therefore the cost of the procedures, and whether the setting affected the rates of adverse outcomes following the procedures.

The procedures studied were colonoscopies, cataract surgery, and magnetic resonance imaging of the head and neck. The study reached the following conclusions:

  • Rates of most patient characteristics that might increase the cost of performing one of the three services were very low in all settings; the vast majority of characteristics were present in fewer than 10% of patients.
  • Looking across all three services and settings, no single setting had consistently higher rates of characteristics that might increase the cost of the procedure.
  • Rates of adverse outcomes were very low in all settings, and the magnitude of significant differences among settings was quite small.

To view MedPAC's report, click here.