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Report: More Outpatient Surgery Centers Open in Pennsylvania

Posted on: Sunday, 4 September 2005, 18:00 CDT

Sep. 2--New outpatient surgery centers continue to crop up across Pennsylvania, and they attract more and more patients, according to a report from the Pennsylvania Health Care Cost Containment Council.

The growth rate of outpatient centers has become a hot topic nationwide. Critics argue that they threaten hospitals by skimming off the more profitable medical procedures, leaving hospitals with less-profitable cases, emergency room cases and patients who can't afford to pay.

Supporters contend that the centers can operate more efficiently and provide greater comfort for patients by specializing in certain procedures.

Thirteen outpatient surgery centers have opened in Pennsylvania since June 2004, bringing the total to 177, according to the cost containment council.

The centers, often owned by doctors and organized as businesses, tend to be much more profitable than hospitals. The average profit in 2004 at the centers was nearly 20 percent, up 3.2 percent from 2003, the council said. At hospitals in the state, the average profit was 3.37 percent last year.

The council report tracks the growth and profitability of the centers, but it doesn't attempt to answer questions about their overall impact on the health-care system.

Council member David Acker, CEO of Charles Cole Memorial Hospital in Potter County, said the outpatient surgery centers might be driving up demand for the procedures they perform. He sees the need for a statewide study to look at what facilities are really needed, and whether communities actually benefit from the additional surgical capacity and increased procedures.

For example, in a community that has seen an increase in facilities performing gastrointestinal procedures and an increase in those procedures, the study would look at whether gastrointestinal cancers are being detected sooner and treated better, Acker said.

Acker also sees a possible conflict of interest with physician-owned facilities, where the doctors who order the procedures have a financial stake in performing them.

Dr. Wilson Jackson of West Shore Endoscopy said the growth of outpatient centers is the reflection of a logical and good evolution in health care.

West Shore Endoscopy, owned by four physicians, is the most profitable outpatient center in the Harrisburg area, with a 44.5 percent profit margin in 2004.

Jackson noted that Medicare pays less for a procedure if it's performed in an outpatient center rather than in a hospital, meaning outpatient centers save the government money.

According to Jackson, outpatient centers achieve higher profits by operating more efficiently. They also can provide a more attractive setting for patients, he said.

"If you look at it from a patient's perspective, they find it much easier to navigate through [an outpatient surgery center] than to navigate through a hospital system," he said.

Jackson said hospitals must realize they no longer can rely on procedures that can be handled better in another setting.

The cost containment council report also looked at long-term acute-care hospitals, rehabilitation hospitals and psychiatric hospitals.

The council found that psychiatric hospitals continue to struggle financially and, as a group, lost money for the 10th consecutive year. But the report said financial performance of the 17 psychiatric hospitals varied widely, ranging from a loss of nearly 30 percent at one facility to a profit of 27 percent at another.

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Source: The Patriot-News

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