Medicare Could Save Billions With New Surgery Protocol

A recent report highlights how much money Medicare saves when surgeries are performed at an ambulatory surgical center instead of a hospital outpatient facility. Future savings are expected to grow.

Published September 30, 2020

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A recent report shows Medicare can save $73.4 billion through 2028 by performing surgeries on Medicare patients in Ambulatory Surgery Centers instead of hospital outpatient departments. 

An Ambulatory Surgical Center, or ASC, is a health care facility that specializes in providing same-day surgical care including diagnostic and preventive procedures. 

The report, issued by the Ambulatory Surgery Center Association and conducted by KNG Health Consulting, shows that Medicare saved $4.2 billion in 2018 alone when surgeries were performed at an ASC as opposed to a hospital surgical facility.

The study examined surgery costs from 2011 to 2018 and forecasted savings will increase significantly over the next decade. 

Study finds Medicare already saved tens of billions

According to the report, Medicare saved $28.7 billion from 2011 to 2018 from surgeries that were performed in ASCs instead of hospital outpatient centers.

The bulk of those savings were from high-volume procedures such as cataract surgeries and colonoscopies. But going forward, most of the future savings will be derived from cardiovascular, orthopedic and endocrine procedures.

Five procedure areas — eye and ocular adnexa, cardiovascular, nervous system, digestive system and musculoskeletal — are projected to save Medicare $1 billion annually by being performed in an ASC.

Additional studies have found that the cost of surgical procedures at an ambulatory surgical center is often less than when performed at a hospital outpatient facility. One study using CDC data of more than 52,000 patients at 437 different medical facilities found savings to range from $363 to $1,000 at ASCs.   

There are more than 5,800 Medicare-certified ASCs in the U.S. Medicare Part B provides coverage for facility service fees related to approved surgical procedures provided in an ambulatory surgical center. The Part B deductible and coinsurance apply, just as they do for procedures performed at hospital outpatient centers. 

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