New Study Reveals Drastic Income and Health Differences Between Hospital Outpatients and Ambulatory Surgical Center Patients

STUDY: HOPDs Treat Poorer, Sicker Patients

WASHINGTON (April 4, 2019) – A new study from the American Hospital Association (AHA) reveals that Medicare patients who receive care in a hospital outpatient department (HOPD) clinic are more likely to be poorer, have severe chronic conditions, and have been previously hospitalized, than Medicare patients treated in an ambulatory surgical center (ASC).  

The findings of this new study, conducted for the AHA by KNG Health Consulting LLC, underscore the unsoundness of compensating hospitals and health systems under Medicare the same amount as ASCs and other locations of care. Proposals under consideration by policymakers to do so fail to recognize the legitimate differences in the types of services hospitals provide, as well as the types of patients hospitals serve.

Already, Medicare reimburses hospitals – which have more comprehensive licensing, accreditation and regulatory requirements than do freestanding physician offices and ASCs – less than the cost of providing care. In Fiscal Year 2017, for instance, Medicare margins for outpatient services were negative 12.8 percent, and overall, Medicare margins were a record low of negative 9.9 percent. Compounding these colossal shortfalls with proposals that treat HOPDs and ASCs the same could threaten access to care for the most vulnerable patients and communities.

“America’s hospitals and health systems provide around-the-clock care to all who come to us; this includes the sickest patients and those in the most vulnerable communities. Physicians tend to refer more complex patients to hospital outpatient departments for safety reasons, as hospitals are better equipped to handle complications and emergencies,” said AHA President and CEO Rick Pollack. “Proposals that treat hospital outpatient departments the same as ambulatory surgical centers and other sites of care are misguided, and ignore the health care needs of the patients and communities we serve.”  

According to today’s study, relative to those seen in an ASC, Medicare patients seen in HOPDs are more likely to be:
 

• From lower-income areas;
• Under 65 (individuals with disabilities, end-stage renal disease, and amyotrophic lateral sclerosis) and over 85;
• Burdened with more severe chronic conditions;
• Previously hospitalized;
• Eligible for both Medicare and Medicaid;
• Previously cared for in an emergency department or short-term acute care hospital setting, thereby having higher Medicare spending prior to receiving ambulatory care.
   

Last December, the AHA and the Association of American Medical Colleges (AAMC), along with three individual hospitals, filed a lawsuit against the U.S. Department of Health and Human Services (HHS) over a dramatic policy shift in the recent Centers for Medicare & Medicaid Services’ (CMS) outpatient prospective payment system (OPPS) final rule that reduced payments for off-campus hospital outpatient clinic visits. The lawsuit argues that CMS is acting outside the law to make this harmful policy change.

For a full copy of today’s study, visit www.aha.org.

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Contact:        

Marie Johnson, 202-626-2351, mjohnson@aha.org

Arika Trim, 202-626-2319, atrim@aha.org

About the AHA

The AHA is a not-for-profit association of health care provider organizations and individuals that are committed to the improvement of health in their communities. The AHA is the national advocate for its members, which include nearly 5,000 hospitals, health care systems, networks and other providers of care. Founded in 1898, the AHA provides education for health care leaders and is a source of information on health care issues and trends. For more information, visit the website at www.aha.org.