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A new 23-state study from the Workers Compensation Research Institute (WCRI) shows that prices paid to ambulatory surgery centers (ASC) in some states were triple that in other states – due to state price regulation or the absence thereof.

“This study will help policymakers and system stakeholders better understand the ASC payments for common surgeries in their state, how they compare with others, and the role of different types of fee schedules,” said Dr. Bogdan Savych, author of the report and a public policy analyst with WCRI.

The study, Payments to Ambulatory Surgery Centers, examines payments for commonly used outpatient surgeries performed at ASCs in 23 large states (including California) that represent over two-thirds of the workers’ compensation benefits paid in the United States and covers surgeries in calendar year 2011.

The following are among the study’s findings:

1) In 2011, ASC payments for the same surgeries performed in higher-cost states were at least three times the payments for similar surgeries performed in lower-cost states. For example, the average ASC payment for knee arthroscopies was less than $2,000 in four study states (Pennsylvania, Michigan, Maryland, and New York) and more than $6,000 in seven study states (Indiana, New Jersey, Virginia, Missouri, Illinois, Connecticut, and Louisiana).
2) Average payments for outpatient surgeries were typically higher in states without fee schedules. For example, the average ASC payment for a common knee arthroscopy in the median state without a fee schedule ($6,272) was nearly double the median payment of the states with fixed-amount fee schedules ($3,174). Similar patterns were also found for shoulder surgeries.
3) Payments for common surgeries were more predictable in states with fixed-amount fee schedules and less predictable in states without fixed-amount fee schedules.

This study looked at actual payments for medical facility services that are associated with common surgical episodes for treating shoulder and knee injury conditions for workers with workers’ compensation claims. Surgeries examined in this analysis represent 44 percent of the ASC surgeries performed for workers with knee conditions and 52 percent of ASC surgeries performed for workers with shoulder conditions.

The study includes 23 large states covering over two-thirds of the workers’ compensation benefits paid in the United States. These states are Arizona, California, Connecticut, Florida, Georgia, Illinois, Indiana, Iowa, Louisiana, Maryland, Michigan, Minnesota, Missouri, New Jersey, New York, North Carolina, Oklahoma, Pennsylvania, South Carolina, Tennessee, Texas, Virginia, and Wisconsin.