Pricing of surgeries for colon cancer

Patient severity and market factors

Authors

  • Avi Dor PhD,

    Corresponding author
    1. Department of Health Policy, School of Public Health and Health Services, George Washington University, Washington, District of Columbia
    • Department of Health Policy, School of Public Health, George Washington University, 2021 K Street NW, Suite 800, Washington, DC 20037
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    • Fax: (216) 296-0025

  • Siran Koroukian PhD,

    1. Department of Epidemiology and Biostatistics, School of Medicine, Case Western Reserve University, Cleveland, Ohio
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  • Fang Xu PhD, MS,

    1. Department of Epidemiology and Biostatistics, School of Medicine, Case Western Reserve University, Cleveland, Ohio
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  • Jonah Stulberg MD, PhD,

    1. Department of Epidemiology and Biostatistics, School of Medicine, Case Western Reserve University, Cleveland, Ohio
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  • Conor Delaney MD, PhD,

    1. Division of Colorectal Surgery, Department of Surgery, University Hospitals Case Medical Center, Cleveland, Ohio
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  • Gregory Cooper MD

    1. Division of Gastroenterology, Department of Medicine, University Hospitals Case Medical Center, Cleveland, Ohio
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  • Preliminary results were presented in part at the AcademyHealth Annual Research Meeting, Seattle, Washington, June 11-14, 2011.

Abstract

BACKGROUND:

This study examined effects of health maintenance organization (HMO) penetration, hospital competition, and patient severity on the uptake of laparoscopic colectomy and its price relative to open surgery for colon cancer.

METHODS:

The MarketScan Database (data from 2002-2007) was used to identify admissions for privately insured colorectal cancer patients undergoing laparoscopic or open partial colectomy (n = 1035 and n = 6389, respectively). Patient and health plan characteristics were retrieved from these data; HMO market penetration rates and an index of hospital market concentration, the Herfindahl-Hirschman index (HHI), were derived from national databases. Logistic and logarithmic regressions were used to examine the odds of having laparoscopic colectomy, effect of covariates on colectomy prices, and the differential price of laparoscopy.

RESULTS:

Adoption of laparoscopy was highly sensitive to market forces, with a 10% increase in HMO penetration leading to a 10.9% increase in the likelihood of undergoing laparoscopic colectomy (adjusted odds ratio = 1.109; 95% confidence interval [CI] = 1.062, 1.158) and a 10% increase in HHI resulting in 6.6% lower likelihood (adjusted odds ratio = 0.936; 95% CI = 0.880, 0.996). Price models indicated that the price of laparoscopy was 7.6% lower than that of open surgery (transformed coefficient = 0.927; 95% CI = 0.895, 0.960). A 10% increase in HMO penetration was associated with 1.6% lower price (transformed coefficient = 0.985; 95% CI = 0.977, 0.992), whereas a 10% increase in HHI was associated with 1.6% higher price (transformed coefficient = 1.016; 95% CI = 1.006, 1.027; P < .001 for all comparisons).

CONCLUSIONS:

Laparoscopy was significantly associated with lower hospital prices. Moreover, laparoscopic surgery may result in cost savings, while market pressures contribute to its adoption. Cancer 2012. © 2012 American Cancer Society.

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