The effect of physician-owned surgicenters on hospital outpatient surgery

Health Affairs

Volumn 21, Issue 4, 2002, Pages 215-221

  Lynk, William J ^a   Longley, Carina S ^a  

^a Lexecon Inc   (United States)

Author keywords

[No Author keywords available]

Indexed keywords

ARTICLE; ECONOMIC ASPECT; ECONOMICS; EVALUATION; HEALTH SERVICES RESEARCH; HOSPITAL DEPARTMENT; HUMAN; ORGANIZATION AND MANAGEMENT; OUTPATIENT DEPARTMENT; PHYSICIAN; UNITED STATES;

ECONOMIC COMPETITION; HEALTH SERVICES RESEARCH; HUMANS; LOUISIANA; OUTPATIENT CLINICS, HOSPITAL; OWNERSHIP; PHYSICIANS; SOUTH DAKOTA; SURGERY DEPARTMENT, HOSPITAL; SURGICENTERS;

EID: 0036636513     PISSN: 02782715     EISSN: None     Source Type: Journal    
DOI: 10.1377/hlthaff.21.4.215     Document Type: Article

References (11)

1. For a useful summary of regulatory law on the practice of "self-referral" as it applies to ASCs, see P.R. DeMuro, "A Review of Key Legal Requirements Affecting Ambulatory Surgical Centers," Health Lawyer (July 1999): 1-11.
2. Surgical Care Center of Hammond d/b/a St. Luke's Surgicenter v. Hospital Service District No. 1 of Tangipahoa Parish d/b/a North Oaks Medical Center, U.S. Dist. Court E.D. Louisiana 2001 U.S. Dist., LEXIS 138 (3 January 2001); and John Mahan, M.D., et al. and Orthopedic Surgery Specialists, Ltd. v. Avera St. Luke's, Supreme Court of South Dakota 2001 S.D., Lexis 9 (10 January 2001). Our analysis is based on the limited amount of relevant data on outpatient surgery that was produced during pretrial fact discovery in these cases.
3. St. Luke's equity ownership is divided between these North Oaks physicians and outside medical industry corporations.
4. The data file identifies which physicians performed which surgeries, allowing us to segregate the eighteen physician-investors, from the noninvestor physicians.
5. John Mahan, M.D., et al. and Orthopedic Surgery Specialists, Ltd. v. Avera St Luke's, para. 34.
6. Specifically, we estimated a regression of the logarithm of the sum of Exhibit 1's total monthly outpatient surgeries on (1) a time trend variable and (2) a binary (1,0) variable for the ASC post-entry time period That analysis yields a coefficient estimate for the ASC effect of .0932 (with a statistical significance level of p = .0238) and an adjusted R-square of .8449.
7. See F.H. Easterbrook, "Vertical Arrangements and the Rule of Reason," Antitrust Law Journal 53, no. 1 (1984): 135-173.
8. "One difficulty [with the output expansion criterion] is the implicit assumption that consumer choices are, at least on average, informed. But if the reason that a practice is challenged is that it may be deceptive, then this underlying assumption may require further investigation." W.J. Lynk, "Establishing Competitive Effects in Markets for Medical Services," in Developments in Antitrust Health Care Law, ed. P.A. Proger, R.C. Busey, and T. Miller (Chicago: American Bar Association, 1990), 211-225, at 216 (footnote omitted).
9. See B.J. Hillman et al., "Frequency and Costs of Diagnostic Imaging in Office Practice - A Comparison of Self-Referring and Radiologist-Referring Physicians," New England Journal of Medicine (6 December 1990): 1604-1608; and J.M. Mitchell, "Physician Joint Ventures and Self-Referral: An Empirical Perspective," in Conflicts of Interest in Clinical Practice and Research, ed. R.G. Spece, D.S. Shimm, and A.E. Buchanan (New York: Oxford University Press, 1996), 300-317.
10. See B.J. Hillman et al., "Frequency and Costs of Diagnostic Imaging in Office Practice - A Comparison of Self-Referring and Radiologist-Referring Physicians," New England Journal of Medicine (6 December 1990): 1604-1608; and J.M. Mitchell, "Physician Joint Ventures and Self-Referral: An Empirical Perspective," in Conflicts of Interest in Clinical Practice and Research, ed. R.G. Spece, D.S. Shimm, and A.E. Buchanan (New York: Oxford University Press, 1996), 300-317.
11. For just one example, even an elementary reflection on the diversity of physicians' clinical practices suggests that physicians who are uncommonly enthusiastic about the merits of diagnostic imaging or outpatient surgery might be both heavy users of those procedures and more likely to invest in facilities to perform them.