Aligning Incentives Could Increase Access to Lower-Cost Surgery Sites: Xiaoxi Zhao, PhD

Based on findings from her study, "Pricing and Insurance Networks in Outpatient Surgery Markets," lead investigator Xiaoxi Zhao, PhD, recommends aligning patient and insurer incentives to encourage ambulatory surgery center (ASC) use through improved price transparency, reduced out-of-pocket costs, and broader network inclusion.

She concludes by emphasizing the need for future research to assess how ASC market consolidation, ownership changes, and new market entries affect prices, access, and patient outcomes.

Watch parts 1 and 2 for a study overview and a deeper analysis of its findings.

This transcript has been lightly edited; captions were auto-generated.

Transcript

How could insurance models better align patient and insurer incentives to encourage greater use of lower-cost ASCs?

I think there are 2 ways. The first one is, as mentioned, there's probably an information gap, so patients are not aware of the large price difference between ASCs and HOPDs [hospital outpatient departments]. Informing them and helping them to identify which facilities are ASCs and which are HOPDs could help them to make a better financial choice, at least.

The second way, of course, is to provide more financial incentives to patients. It could be lowering the ASC out-of-pocket payments so that patients have more incentives to go to ASCs compared with an HOPD.

I think also what is important is the access to ASCs. Including more ASCs in the provider network can definitely increase the use of ASCs, even if the patients are still really focused on the network status rather than the site of care. I think that's basically the tools we could use right now.

What further research is needed to build upon these findings?

There are a couple of things. The first one is about the quality and patient selection. ASCs provide procedures to relatively lower-risk patients, and previous studies have already found that, for the current populations, there's no quality difference between procedures performed at ASCs vs HOPDs. If we encourage more patients to use ASCs, it may mean there are more relatively less healthy patients going to use ASCs; will there be any quality implications that are worth studying?

On the other side, I'm interested in the market structure and the market dynamics; there are ongoing acquisitions and ownership changes in ASCs, including hospital systems and insurers acquiring ASCs. I think that it will be interesting to study the consequences of those acquisitions, of those integration cases. After that acquisition, the bargaining power may change a little bit.

Another aspect of the market is market entry. What if there are more ASCs? There might be an increase in demand, so there may be more new ASCs entering the market. If that is the case, how could it be related to the price, access, and patients' health outcomes?