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MEDICARE MONITOR


prices across settings. For example, bundled payments, which pay a flat fee per episode of care rather than paying for each individual service, would, in general, pay a group of providers the same amount regardless of whether ele- ments of the care are provided in tradi- tionally more expensive settings, such as HOPDs, or less expensive settings, such as ASCs. And Accountable Care Organizations, which strive to reward lower costs, might equalize prices by making the lowest price in the market the prevailing price for the service. Although both policy makers and consumers are expressing a keen inter- est in reducing the costs of health care and, as a result, more attention is being given to the idea of paying the same across settings, it is a change that will not likely occur overnight. Price dis- crepancies for at least some services will likely persist. Additionally, in the


ASCs need to continue to make the argument that payment policies should encourage the greater use of ASCs.”


—Jonathan Beal


current climate, the pressure will be on lowering higher prices rather than pay- ing lower cost providers more. A move toward equalized payments


could have a real impact on the busi- ness model of ASCs. For example, if the process reduces the rates paid to hospitals, hospitals might be more willing to see those services migrate to the ASC setting. And there is definitely room for growth in ASC market share. For example, as compared to HOPDs, ASCs currently provide only about 35 percent of the ASC-eligible proce- dures, while HOPDs perform the other 65 percent. This ratio has remained


largely unchanged over recent years. In contrast, ASCs might see certain procedures migrating to the less costly physician office setting if the price in that setting becomes the prevailing market price for certain procedures. Ultimately, as with the other chang- es to the health care system, ASCs must remain engaged in the decision making process as payers and policy makers determine what to pay for health care. Whether the topic at hand is improved cost or quality, ASCs need to continue to make the argument that payment policies should encourage the greater use of ASCs.


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