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Ambulatory Surgery Centers (ASCs) are small, typically physician-owned healthcare facilities that specialize in performing outpatient surgeries and therefore compete against hospitals for patients. Physicians who own ASCs could potentially treat their most profitable patients at their ASCs and less profitable patients at hospitals, reducing hospitals’ profit.

This project investigates if the profitability of outpatient surgery impacts where a physician performs the surgery. Data from the National Survey of Ambulatory Surgery show that higher profit surgeries do have a higher probability of receiving treatment at an ASC compared to a hospital. After controlling for the type of surgery performed, a 10 percent increase in a surgery’s profitability is associated with a 1- to 2-percentage point increase in the probability the surgery is performed at an ASC. This project extends previous work in order to control for unobservable confounders at a more narrowly defined geographic level than region.

Charles Courtemanche
Michael Plotzke

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