Costs and outcomes of inpatient versus outpatient hernia repair

This study sought to compare treatment costs and outcomes for a large number of Medicare patients undergoing inpatient versus outpatient hernia repair around the country. Medicare physician and hospital claims were obtained for all Medicare enrollees residing in eleven states in 1987 and 1988, in order to take advantage of geographic variation in treatment location. All patients undergoing uncomplicated inguinal hernia repair were identified from the surgeon's bill; the location of surgery was then validated by the facility bill (n = 27,036). Over one-third of all hernia repairs in our sample were performed on an ambulatory basis, but with tremendous variation across states, ranging from 89.9% of cases in Washington in outpatient settings to almost none (6.3%) in Georgia. Treatment costs were 56% higher for hernias repaired on an inpatient basis, $2341 versus $1505 for those performed in outpatient settings. There were no detectable differences between inpatients and outpatients along such outcomes as complication rates, deaths and hernia recurrence, but readmission rates were higher for inpatients. The dramatic differences in costs, along with the apparent absence of adverse outcomes, suggests that Medicare should actively encourage surgeons to perform more hernia repairs on an outpatient basis.