Ambulatory and Hospital Outpatient Procedure Trends

Maria Shepherd

Data Decision Group

We all wish we had a crystal ball, right? That would make forecasting for medical device companies much easier. Well, there’s no magic looking glass into the future, but a good set of statistics can almost be as helpful. The location of surgery is critical to forecasting the use of devices and understanding trends that affect the medical device industry. The National Center for Health Statistics, a division of the Centers for Disease Control and Prevention (CDC), tracks a host of medical statistics useful to medical device manufacturers.

For example, the National Center for Health Statistics, released a report titled “Ambulatory Surgery in the United States.” Originally released in 2006, the report was revised in 2009 due to an error discovered in the processing of ambulatory surgery procedure data. In the updated report, all procedure data were rerun and some reported findings have changed.
This is the most recent update of this report, because government data tends to lag by approximately five years. The report provides statistics on the shift from hospital-based inpatient procedures to hospital outpatient or freestanding ambulatory surgery centers (ASCs) within the past two decades. Key statistics are presented below. (A full copy of the

report can be downloaded at www.ddecisiongroup.com/publications.)

What’s Driving the Shift?

According to the report, the two drivers behind the shift from hospital-based surgeries to ASC based procedures are advances in medical technology and changes in reimbursement. Advances in medical technology have made surgery less complex, with reduced risk and have enabled the shift of many procedures from inpatient to ambulatory settings.

Other drivers cited in this report include new methods in the delivery of anesthesia, which enables patients to regain consciousness quickly with fewer side effects. Minimally invasive and non-invasive procedure rates for laser surgery, laparoscopy, and endoscopy are increasing too; these procedures all can be performed at outside surgical centers rather than in a hospital setting.

The second driver of this shift from hospital-based to ASC-based procedures has been rising healthcare costs. Cost increase concerns led to changes in Medicare that provide favorable reimbursement for outpatient procedures. When Medicare was expanded to cover ASC care in the early 1980s, diagnosis-related group payment systems were selected for hospital inpatient care. This created a financial incentive for hospitals to shift less complex surgery to outpatient settings. These policies also were implemented by state Medicaid plans and some private insurers.

Key Definitions

The report defines ASCs and hospital outpatient centers as non-institutional hospitals exclusive of federal, military, and U.S. Department of Veterans Affairs hospitals. Only short-stay hospitals (institutions with an average length of stay of less than 30 days), or those with a specialty defined as general (medical, surgical or children’s general) were included in the survey.

Leading ASC Diagnoses

The top-five leading diagnoses at most ambulatory surgery centers included:

• Cataract: 3 million per year

• Benign neoplasms: 2 million per year

• Malignant neoplasms:1.2 millionper year

• Esophageal disease: 1.1 millionper year

• Diverticula of the intestine:1.1 million per year

Other Data in this Report

This report is a comprehensive overview of the trends in outpatient surgery in the United States. Other data includes:

• Demographic information;

• Procedure rates; and

• Number of procedures performedper visit.

Maria Shepherd has 20 years of leadership experience in medical device and life-science marketing in small startups and top-tier companies. Following a career in senior management positions including vice president of marketing for Oridion Medical, director of marketing for Philips Medical and senior management roles at Boston Scientific Inc., she founded Data Decision Group. The firm quantitatively and qualitatively sizes opportunities, evaluates new technologies, provides marketing services and assesses prospective acquisitions. Shepherd can be reached at (617) 548-9892, [email protected], or throughwww.ddecisiongroup.com.