Performance Measurement in the Hospital Outpatient Setting. Analysis of Medicare OPPS Data


Based on our analysis of the Medicare OPPS facility data, in 2005 CMS was billed for 15,325,267 E&M encounters and 78,538,882 services/procedures in the HOPS. In the same year CMS was billed for 11,426,386 E&M encounters and 22,494,724 services/procedures in the ED. Overall, services/procedures represented a significant volume of the care provided in the hospital outpatient setting. More specifically, the top 20 most frequent services/procedures accounted for 58 percent of total services/procedures in the HOPS, and 94 percent of total services/procedures in the ED. Had 2007 payment rates been in effect in 2005, CMS would have paid $19.1 billion for services/procedures in the HOPS, and $1.7 billion for services/procedures in the ED2. The top 20 services/procedures, as a fraction of total costs based on application of 2007 payment rates, accounted for 44 percent of total dollars in the HOPS, and 83 percent of total dollars in the ED.

Of the conditions or services representing the greatest share of utilization and/or costs as a percentage of total use or spending, we find:

  • General medical conditions are the most common reasons for visits in both the HOPS and ED.
    • In the HOPS, general medical conditions (e.g., hypertension, aftercare for procedures, and specific and general symptoms like fever, dizziness) account for 35 percent of the care delivered, followed by oncology and neoplasia (13 percent); orthopedic conditions (10 percent) (e.g., back pain and arthritis); and endocrinology (7 percent) (e.g., diabetes).
    • In the ED, general medical conditions (e.g., “symptoms,” injury like back sprains, lacerations) represented an even larger share of care delivered than in the HOPS (43 percent), followed by orthopedic conditions (17 percent).
  • Ancillary services/ procedures, especially radiological, are the most common types of services/procedures provided in both the HOPS and ED settings.
    • X-ray was found to be the most common service/procedure performed in both the HOPS and ED; however, it represents a larger proportion of the total in the ED (30 percent) as compared to the HOPS (12 percent).
    • In the HOPS, other common services/procedures performed include Level III Pathology (5 percent) and electrocardiograms (4 percent).
    • In the ED, electrocardiograms (16 percent) and Level II Drug Administration (9 percent) were found to be the most frequently performed services/procedures after X-ray.
  • In the aggregate, many of the most common services/procedures also represent a substantial proportion of all costs in the hospital outpatient setting3. This finding is especially true of radiological services in both the HOPS and ED (X-ray, CT scans), and of X-ray in the ED (X-ray is one of the top two most frequent and most costly services provided in the ED). In the HOPS, the top two most costly services/procedures were cataract surgery (5 percent) and cardiac catheterization (5 percent), although neither of these procedures was found to be among the top 20 most frequently performed services/procedures in the HOPS. In the ED, the top two services/procedures as a function of total costs — CT scans (20 percent) and X-rays (17 percent) — accounted for 37 percent of total costs for services/procedures in the ED. Besides these areas, in the HOPS and ED, most single services/procedures were not found to account for a large proportion of total cost; however, services/procedures that account for even 1-2 percent of total spending in this setting represent significant spending.
  • Imaging contrast material, blood products and cancer chemotherapy medications are among the most frequent drugs/biologicals used in both the HOPS and ED. In the ED, several thrombolytic agents are also among the most frequently used.

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