Hospitals Face Steep Competition From Freestanding Outpatient Centers
by Patricia Chaney
With reimbursement cuts, increasingly price-sensitive consumers and payers, and the development of accountable care organizations, independent outpatient facilities stand to take market share from hospitals. Outpatient imaging and ambulatory surgery centers pose steep competition for hospitals in certain markets, but with all providers struggling to balance reimbursements and payer negotiations, there’s more willingness to develop partnerships that benefit both parties.
Joint ventures in these areas can promote physician alignment, lock in referral sources, and allow hospitals to retain a portion of the profits from what would otherwise be lost encounters.
Understanding the competition
With more employers offering, and patients choosing, high-deductible health plans (HDHPs), the days of the $20 co-pay are largely over. According to an October 2014 presentation by the Advisory Board Company, “The New Imaging Pricing Mandate: Responding to an Era of Mounting Pressures,” 84 percent of imaging programs are reporting an increase in the frequency of pricing questions from patients.
The Department of Health and Human Services reports that during the initial open enrollment period following the passage of the Affordable Care Act, 65 percent of people who purchased a Marketplace plan chose a Silver plan. The median annual out-of-pocket maximum for a Silver plan is $6,350.
This places more emphasis on patients looking for value, and hospitals have typically been far more ex- pensive in the areas of outpatient imaging services and outpatient surgery. Payers are also looking for value and, in some cases, actively steering patients away from hospital-based outpatient departments.