title: Insurance incentives for ambulatory surgery.
abstract: This study is an attempt to address both the extent to which surgical procedures on an outpatient basis substitute cost-effectively for inpatient procedures, and whether or not an insurance policy's financial incentives increase the volume of outpatient surgical procedures. In particular, given an insurance product of a given composition: What is the probability that the insured will have surgery? and if a surgery does take place, what is the probability that it will occur in an outpatient setting? Finally, the article assesses the implication of such products on the total cost of care by quantifying the insurance plans along two parameters, the relative user price for outpatient versus inpatient surgery and the absolute price for the inpatient surgery. The results indicate that insurance policies that offer relatively lower out-of-pocket payments for ambulatory surgery do not increase the probability that surgery will be done in the ambulatory setting. However, higher out-of-pocket payments for surgery, regardless of site, do reduce the surgery rate. There are other patient and market characteristics, especially the availability of freestanding surgery firms, that do influence the location of surgery.
authors.affiliation: Wharton School, University of Pennsylvania, Philadelphia 19104.
authors.forename: M V
authors.initials: MV
authors.lastname: Pauly
authors.forename: M H
authors.initials: MH
authors.lastname: Erder
mesh_terms: D000556:Ambulatory Surgical Procedures / Q000191:economics* / Q000706:statistics & numerical data; D003362:Cost-Benefit Analysis / Q000706:statistics & numerical data; D006264:Health Benefit Plans, Employee / Q000191:economics / Q000706:statistics & numerical data; D006302:Health Services Research; D006801:Humans; D007359:Insurance, Surgical / Q000191:economics / Q000706:statistics & numerical data; D017059:Models, Econometric; D011336:Probability; D012044:Regression Analysis; D012052:Reimbursement, Incentive / Q000191:economics / Q000706:statistics & numerical data; D014481:United States