There is considerable data showing that disparities in payment across sites of service increase costs to patients, insurers and taxpayers as well as result in marketplace consolidation that limits patient choice by reducing access to care in the community-setting.

March 10, 2023

BCBSA: Site-Neutral Payments Would Save Nearly $500 Billion Over 10 Years

The Blue Cross Blue Shield Association (BCBSA), a member of the Alliance for Site Neutral Payment Reform, recently released a white paper titled, “Delivering Lower Costs for Patients and Taxpayers Through Site-Neutral Payment Reform,” which makes several recommendations to lower costs for patients and the Medicare program by bringing payment parity for certain medical services […]

February 14, 2023

Health Savers Initiative: Site-Neutral Payments Would Lower Private Health Costs, Encourage Competition

A recent report published by the Health Savers Initiative examined site-of-service payment issues in the commercial market. Digging into the problems with site-specific payments, the report explains, “site-based payments create incentives to provide services in higher-cost settings, generally hospital outpatient departments (HOPDs) instead of independent physician offices. Importantly, these site-based incentives also encourage vertical integration […]

August 28, 2022

Health Care Cost Institute: Employer-based Insurance Pays HOPDs 3x more than Physician Offices and Independent Labs for Identical Tests

A report issued in July 2022 compared prices for clinical lab tests between HOPDs and physician offices and independent labs among individuals with employer-based health insurance. The study included 232 million lab tests in 2019 resulting in $7 billion in spending. The report found the following: Employer-based insurance is typically paying 3 times more for […]

June 22, 2022

HHS OIG Confirms Medicare and Beneficiaries Paid Substantially More in HOPDs than in Freestanding Physician Offices

A report issued in June 2022 summarized the findings of an audit conducted by the Department of Health and Human Services (HHS) Office of the Inspector General that compared Medicare payments to hospital outpatient departments (HOPDs) with those made to freestanding physician offices for the exact same services. The audit examined payments for Evaluation and […]

June 16, 2022

MedPAC: Payment Differences Across Settings Encourage Consolidation, Resulting in Care Shifting Toward the Most Expensive Setting

On June 15, the Medicare Advisory Payment Committee (MedPAC) issued its annual June Report to Congress. This report featured a chapter on aligning fee-for-service payment across ambulatory settings. According to MedPAC, “payment differences across settings encourage arrangements among providers—such as the consolidation of physician practices with hospitals—that result in care being billed at the payment […]

August 19, 2021

Employee Benefit Research Institute: Physician-Administered Outpatient Drugs Cost More than $14 Billion More When Delivered in HOPD

A new study from the Employee Benefit Research Institute’s Center for Research on Health Benefits Innovation finds that employers and workers would collectively save $14.1 billion annually if price differentials between hospital outpatient departments (HOPDs) and physician offices (POs) were eliminated for all physician-administered outpatient drugs (PAODs). On average, plan payments to HOPDs are triple […]

June 29, 2021

PAI-Avalere Health Report on Trends in Physician Employment and Acquisitions of Medical Practices in 2019-2020

A study released by PAI and conducted by Avalere Health shows that hospital systems and other corporate entities continued to drive consolidation in healthcare by aggressively acquiring physician practices throughout 2019 and 2020, especially during the last half of 2020 at the height of the COVID-19 pandemic.  The study’s findings include: Only 30 percent of […]

June 10, 2021

ASCO: Study Finds Shift to HOPD Leads to Substantially Higher Chemotherapy Costs

In 2014, ASCO published data on the impact of site of service and chemotherapy costs. In this updated study, ASCO takes another look at the shift towards to the hospital outpatient department (HOPD) setting and the subsequent impact on costs in commercially insured patients. Specifically, ASCO examined chemotherapy claims by a large national payor from […]

February 24, 2021

Health Services Research: Hospital‐physician integration and Medicare’s site‐based outpatient payments

A recent study examined the relationship between Medicare’s site-based outpatient billing policy and hospital-physician integration, using Medicare claims data from 2010 to 2016. The study estimated the dollar value associated with hospitals acquiring physician practices or employing physicians by using each physician’s bundle of Medicare services. Overall, the study found the financial incentive was large: […]

February 23, 2021

Health Savers Initiative: Equalizing Medicare Payments Regardless of Site-of-Care

A joint venture between the Committee for the Responsible Federal Budget, Arnold Ventures, and West Health recently released a policy brief recommending policymakers consider “Equalizing Medicare Payments Regardless of Site-of-Care” to reduce health costs for households, businesses, and the federal government. In part, the authors argue: “higher payments are difficult to justify when offered to […]

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