Reference-Based Benefits for Colonoscopy and Arthroscopy: Large Differences in Patient Payments Across Procedures but Similar Behavioral Responses

Med Care Res Rev. 2020 Jun;77(3):261-273. doi: 10.1177/1077558718793325. Epub 2018 Aug 13.


This study examines how reference-based benefits (RBB) affect patient out-of-pocket payments across outpatient procedures. The California Public Employees' Retirement System (CalPERS) implemented RBB asymmetrically for outpatient procedures in 2012, only applying RBB to outpatient procedures performed in a hospital outpatient department (HOPD), and not applying RBB to outpatient procedures performed in a lower cost ambulatory surgery center. Using claims data (2009-2013) on arthroscopy and colonoscopy services, we found that for colonoscopy, CalPERS patients paid an average of 63.9% (p < .01) more for HOPDs than ambulatory surgery centers in 2012. For arthroscopy, no statistically different cost sharing was found on average. However, high-priced HOPDs were 17.3% and 17.9% less likely to be chosen by CalPERS patients in 2012 for colonoscopy and arthroscopy, respectively. These magnitudes increased in 2013 to 25.2% and 24.2% less, respectively. Overall, responsiveness to RBB with regard to the most expensive HOPDs was similar despite varying cost sharing by procedure.

Keywords: cost sharing; difference-in-differences; reference pricing.

Publication types

  • Research Support, U.S. Gov't, P.H.S.

MeSH terms

  • Ambulatory Surgical Procedures* / statistics & numerical data
  • Arthroscopy* / economics
  • Arthroscopy* / statistics & numerical data
  • California
  • Colonoscopy* / economics
  • Colonoscopy* / statistics & numerical data
  • Cost Sharing*
  • Female
  • Health Expenditures / statistics & numerical data*
  • Hospitals
  • Humans
  • Male
  • Middle Aged