Pricing of surgeries for colon cancer: Patient severity and market factors

Avi Dor*, Siran Koroukian, Fang Xu, Jonah Stulberg, Conor Delaney, Gregory Cooper

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

29 Scopus citations


BACKGROUND: This study examined effects of health maintenance organization (HMO) penetration, hospital competition, and patient severity on the uptake of laparoscopic colectomy and its price relative to open surgery for colon cancer. METHODS: The MarketScan Database (data from 2002-2007) was used to identify admissions for privately insured colorectal cancer patients undergoing laparoscopic or open partial colectomy (n = 1035 and n = 6389, respectively). Patient and health plan characteristics were retrieved from these data; HMO market penetration rates and an index of hospital market concentration, the Herfindahl-Hirschman index (HHI), were derived from national databases. Logistic and logarithmic regressions were used to examine the odds of having laparoscopic colectomy, effect of covariates on colectomy prices, and the differential price of laparoscopy. RESULTS: Adoption of laparoscopy was highly sensitive to market forces, with a 10% increase in HMO penetration leading to a 10.9% increase in the likelihood of undergoing laparoscopic colectomy (adjusted odds ratio = 1.109; 95% confidence interval [CI] = 1.062, 1.158) and a 10% increase in HHI resulting in 6.6% lower likelihood (adjusted odds ratio = 0.936; 95% CI = 0.880, 0.996). Price models indicated that the price of laparoscopy was 7.6% lower than that of open surgery (transformed coefficient = 0.927; 95% CI = 0.895, 0.960). A 10% increase in HMO penetration was associated with 1.6% lower price (transformed coefficient = 0.985; 95% CI = 0.977, 0.992), whereas a 10% increase in HHI was associated with 1.6% higher price (transformed coefficient = 1.016; 95% CI = 1.006, 1.027; P <.001 for all comparisons). CONCLUSIONS: Laparoscopy was significantly associated with lower hospital prices. Moreover, laparoscopic surgery may result in cost savings, while market pressures contribute to its adoption.

Original languageEnglish (US)
Pages (from-to)5741-5748
Number of pages8
Issue number23
StatePublished - Dec 1 2012


  • colon cancer
  • laparoscopy
  • medical prices
  • surgery

ASJC Scopus subject areas

  • Oncology
  • Cancer Research


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