601 New Jersey Avenue, N.W. • Suite 9000

Washington, DC 20001

202-220-3700 • Fax: 202-220-3759

Website: www.medpac.gov

Glenn M. Hackbarth, J.D., Chairman

Robert D. Reischauer, Ph.D., Vice Chairman

Mark E. Miller, Ph.D., Executive Director

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Further analyses of Medicare procedures provided in

multiple ambulatory settings: An introduction

Technological advances in medical procedures,

drugs, and devices have made it possible to

deliver in a variety of ambulatory settings many

medical services that were once limited to

inpatient hospital care. For example, cataract

surgery can be provided in both hospital

outpatient departments (OPDs) and ambulatory

surgical centers (ASCs). Medicare’s payment

rates for the same service usually vary across

settings. Is that appropriate? Should payment

rates for the same service vary based on cost

differences among settings or should the rates be

uniform across sites of care, adjusting for

differences in patient mix?

To begin addressing these policy issues, the

Commission contracted with RAND Health to

conduct two studies to explore the following

analytical questions:

• Do the types of patients who receive a

service differ systematically by setting?

• Does the nature of a service vary based

on the setting in which it is provided? • Does quality of care vary by setting? 

In its first study, RAND conducted a literature

review and convened expert panels of physicians

to identify patient and adverse outcome measures

for three high-volume services performed in

multiple ambulatory settings: cataract surgery,

colonoscopy, and magnetic resonance imaging

(MRI) of the head, neck, and brain. RAND also

explored the feasibility of using Medicare claims

data to measure the indicators. This study is

available at

http://medpac.gov/publications/contractor_

reports/Oct04_ASC_Rpt_intro.pdf.

RAND conducted a second study of the same

three procedures to address two questions: 

1. Are certain settings more likely to have

patients with characteristics that might

increase the cost of performing the

procedure?

2. Are there significant differences among

settings in the risk-adjusted rates of

adverse outcomes following the

procedure? 

To examine the first question, RAND selected

clinical experts to help identify patient

characteristics that might increase the facility

cost of each procedure (i.e., the non-professional

portion of the service). For example, it may take

longer (and therefore cost more) to obtain

consent from and explain post-surgical care to

patients with dementia. These characteristics

were not formally evaluated by large panels of

clinical experts, nor did RAND quantify the

relationship between each characteristic and cost

differences. To explore the second question,

RAND selected adverse outcomes for each

procedure based on their incidence,

preventability, severity, and whether they could

be differentiated from a patient’s pre-existing

condition. Rates of adverse outcomes in each

setting were adjusted for several patient factors,

including demographic characteristics and

comorbidities. 

Based on the three services examined, the study

makes the following conclusions: • Rates of most patient characteristics that

might increase the cost of performing one

of the three services were very low in all

settings; the vast majority of

characteristics were present in fewer than

10 percent of patients. 

• Looking across all three services and

settings, no single setting had consistently

higher rates of characteristics that might

increase the cost of the procedure. Where
2

statistical differences existed, OPD

patients had higher rates of

characteristics than ASC patients for

cataract surgery and colonoscopy, but

patients treated in physician offices and

testing facilities had higher rates of

certain characteristics for MRI of the

head, neck, and brain. 

• Rates of adverse outcomes were very low

in all settings, and the magnitude of

significant differences among settings

was quite small. 

Because the study examined only three

procedures, it is difficult to draw general

conclusions. Nevertheless, this study

demonstrates that claims data can be used to

evaluate differences among sites of care and is

thus an important step in addressing whether

payment variations among settings are

appropriate. The final report follows.

Staff contacts

Ariel Winter 

(202) 220-3700

October 23, 2006
Elizabeth M. Sloss

Constance Fung

Barbara O. Wynn

J. Scott Ashwood

Michael A. Stoto

RAND Health

1200 South Hayes Street

Arlington, VA 22202-5050

MedPAC

601 New Jersey Avenue, NW

Suite 9000

Washington, DC 20001

(202) 220-3700

Fax: (202) 220-3759

www.medpac.gov

•

•

The views expressed in this report

are those of the authors.

No endorsement by MedPAC

is intended or should be inferred.

Further Analyses of

Medicare Procedures

Provided in Multiple

A study conducted by staff from Rand Health for the

Medicare Payment Advisory Commission

October 2006 • No. 06–6

Ambulatory Settings
WORKING 

P A P E R

Further Analyses of 

Medicare Procedures 

Provided in Multiple 

Ambulatory Settings

ELIZABETH M. SLOSS 

CONSTANCE FUNG 

BARBARA O. WYNN 

J. SCOTT ASHWOOD 

MICHAEL A. STOTO 

WR-349-MEDPAC 

Prepared for the Medicare Payment Advisory Commission 

This product is part of the RAND 

Health working paper series. 

RAND working papers are intended 

to share researchers’ latest findings 

and to solicit informal peer review. 

They have been approved for 

circulation by RAND Health but 

have not been formally edited 

or peer reviewed. Unless otherwise 

indicated, working papers can be 

quoted and cited without permission 

of the author, provided the source is 

clearly referred to as a working paper. 

RAND’s publications do not necessarily 

reflect the opinions of its research 

clients and sponsors. 

is a registered trademark. 

Preface 

Technological advances such as improved anesthesia and pain management coupled with 

health care financing changes have produced a shift in many services from inpatient to outpatient 

settings. As a result, both the volume and complexity of procedures provided in ambulatory 

settings have increased. Very little is known, however, about the effect of the shift from 

inpatient to ambulatory care on quality of care and how patient and procedure characteristics 

vary among ambulatory settings. 

In this report, we conduct empirical analyses of three high-volume medical procedures, 

each of which is performed frequently in two or more ambulatory settings. The study population 

consists of Medicare patients having one of the three procedures in an ambulatory setting during 

2001. The three procedures, selected as part of a previous study, are cataract surgery, 

colonoscopy, and magnetic resonance imaging of the head, neck, and brain. The ambulatory 

settings of interest are the hospital outpatient department, the ambulatory surgical center, the 

physician office, and the independent diagnostic testing facility. 

As a followup to a previous study, the Medicare Payment Advisory Commission 

(MedPAC) asked RAND to conduct further analyses on these three procedures. First, they 

requested a comparison across settings of patient characteristics that might increase the facility 

cost of performing the procedure. In addition, they requested that a set of adverse outcomes 

meeting certain criteria be selected and analyzed to evaluate how risk-adjusted outcome rates 

vary by the setting in which the service is provided. These analyses are useful for evaluating 

quality and policy issues such as the appropriateness of site-of-service payment differentials 

across ambulatory settings for the same procedure. 

The report should be of interest to those concerned with issues related to Medicare 

reimbursement policy, quality of care, and ambulatory health care, including those interested in 

health policy and in the field of health services research. This research was sponsored by 

MedPAC under Contract E4015950. 

iii

Contents 

Preface ..........................................................................................................................................................................iii

Tables ..........................................................................................................................................................................vii

Summary.......................................................................................................................................................................ix

Acknowledgments.......................................................................................................................................................xv

List of Abbreviations.................................................................................................................................................xvii

1. Introduction ..........................................................................................................................................................1

Overview of Phase 1 Study...................................................................................................................................1

Objectives of Current Study .................................................................................................................................3

Organization of This Report .................................................................................................................................4

2. Methods for Selection and Analysis of Study Measures ......................................................................................5

Selection of Measures...........................................................................................................................................5

Analysis of Administrative Data...........................................................................................................................8

3. Results of Selection Process and Data Analysis.................................................................................................17

Comparison of Patient Characteristics Across Settings......................................................................................17

Comparison of Outcome Measures Across Settings...........................................................................................28

4. Summary and Discussion .......................................................................................................................................43

Summary of Findings..........................................................................................................................................43

Discussion...........................................................................................................................................................44

Conclusion ..........................................................................................................................................................48

Appendices ..................................................................................................................................................................49

Appendix A. Background of Clinical Consultants.....................................................................................................51

Appendix B. HCPCS/CPT Codes for Study Procedures............................................................................................53

Appendix C. Patient Characteristics: ICD-9-CM Codes and Clinical Expert Comments for Three 

Procedures ..........................................................................................................................................................57

Appendix D. Patient Characteristic Results for RBC and Non-RBC Colonoscopy ...................................................67

Appendix E. Patient Characteristic Results for MRI (Brain) With and Without Contrast.........................................69

Appendix F. Contract Deliverable: Proposed Outcome Measures for Risk Adjustment............................................73

Appendix G. Cataract Surgery: Covariates and Parameter Estimates for Logistic Regression Models.....................99

Appendix H. Perforation: Covariates and Parameter Estimates for Logistic Regression Models............................101

Appendix I. Anaphylaxis: Covariates and Parameter Estimates for Logistic Regression Models for 

Comparison of Three Settings ..........................................................................................................................103

Appendix J. Specifications for Computer Runs to Analyze Outcome Measures.....................................................109

Bibliography..............................................................................................................................................................121

v

Tables 

Table 3.1 Characteristics of Cataract Surgery Patients By Setting, Medicare Fee-for-Service, 2001........................18

Table 3.2 Characteristics of Colonoscopy Patients By Setting, Medicare Fee-for-Service, 2001 .............................20

Table 3.3 Characteristics of MRI (Brain) Patients By Setting, Medicare Fee-for-Service, 2001...............................23

Table 3.4 Characteristics of MRI (Brain) Patients By OPD and Office/IDTF Combined, Medicare Fee-forService, 2001 ......................................................................................................................................................26

Table 3.5 Risk-Adjusted Rates* of Selected Outcomes Occurring Within 30 Days Following Cataract 

Surgery By Setting, Medicare Fee-for-Service, 2001.........................................................................................31

Table 3.6 Parameter Estimates from Logistic Regression for Endophthalmitis within 30 Days of Cataract 

Surgery, Medicare Fee-for-Service, 2001...........................................................................................................32

Table 3.7 Parameter Estimates from Logistic Regression for Cataract Fragments within 30 Days of 

Cataract Surgery, Medicare Fee-for-Service, 2001 ............................................................................................33

Table 3.8 Parameter Estimates from Logistic Regression for Persistent Corneal Edema within 30 Days of 

Cataract Surgery, Medicare Fee-for-Service, 2001 ............................................................................................33

Table 3.9 Parameter Estimates from Logistic Regression for Iris Prolapse within 30 Days of Cataract 

Surgery, Medicare Fee-for-Service, 2001...........................................................................................................34

Table 3.10 Risk-Adjusted Rates* of Perforation Occurring Within 30 Days Following Colonoscopy By 

Setting, Medicare Fee-for-Service, 2001............................................................................................................35

Table 3.11 Parameters from Logistic Regression for Perforation within 30 Days of All Colonoscopies, 

Medicare Fee-for-Service, 2001 .........................................................................................................................36

Table 3.12 Risk-Adjusted Rates* of Anaphylaxis/Anaphylactoid Reaction Occurring Within 7 and 30 

Days Following MRI (Brain) in OPD, Office, and IDTF, Medicare Fee-for-Service, 2001..............................39

Table 3.13 Risk-Adjusted Rates* of Anaphylaxis/Anaphylactoid Reaction Occurring Within 7 and 30 

Days Following MRI (Brain) in OPD and IDTF and Office Combined, Medicare Fee-for-Service, 

2001 ....................................................................................................................................................................40

Table 3.14 Parameters from Logistic Regression for Anaphylaxis within 7 Days of All MRIs (Brain) for 

Three Settings, Medicare Fee-for-Service, 2001 ................................................................................................40

Table B.1 BETOS P4B: Eye procedure—Cataract Removal/Lens Insertion .............................................................53

Table B.2 BETOS P8D: Endoscopy—colonoscopy...................................................................................................54

Table B.3 BETOS I2C: Advanced imaging—MRI: head, neck, and brain................................................................55

Table D.1 Characteristics of RBC Colonoscopy Patients By Setting, Medicare Fee-for-Service, 2001....................67

Table D.2 Characteristics of Non-RBC Colonoscopy Patients By Setting, Medicare Fee-for-Service, 2001 ...........68

Table E.1 Characteristics of Patients with MRI (Brain) With Contrast By Setting, Medicare Fee-forService, 2001 ......................................................................................................................................................69

Table E.2 Characteristics of MRI (Brain) Without Contrast Patients By Setting, Medicare Fee-for-Service, 

2001 ....................................................................................................................................................................70

Table E.3 Characteristics of MRI (Brain) With Contrast Patients By OPD and IDTF/Office Combined, 

Medicare Fee-for-Service, 2001 .........................................................................................................................71

vii
Table E.4 Characteristics of MRI (Brain) Without Contrast Patients By OPD and IDTF/Office Combined, 

Medicare Fee-for-Service, 2001 .........................................................................................................................72

Table F.1 Adverse Outcomes Listed in Phase 1 Ratings Sheets for Three Procedures..............................................74

Table F.2 Definition of Scale Used by Phase 1 Panels to Rate Preventability and Severity......................................75

Table F.3 Cataract Surgery Summary Based on Panel Ratings and Claims Analysis................................................93

Table F.4 Colonoscopy Summary Based on Panel Ratings and Claims Analysis......................................................95

Table F.5 MRI (Brain) Summary Based on Panel Ratings and Claims Analysis.......................................................96

Table F.6 Recommended Measures with Panel Ratings and Frequency.....................................................................97

Table G.1 Cataract Surgery Covariates Used in Logistic Regression Models By Setting, Medicare Fee-forService, 2001 ......................................................................................................................................................99

Table H.1 Perforation Covariates Used in Logistic Regression Models By Ambulatory Setting, Medicare 

Fee-for-Service, 2001 .......................................................................................................................................101

Table H.2 Parameters from Logistic Regression for Perforation within 30 Days of RBC Colonoscopies, 

Medicare Fee-for-Service, 2001 .......................................................................................................................102

Table H.3 Parameters from Logistic Regression for Perforation within 30 Days of Non-RBC 

Colonoscopies, Medicare Fee-for-Service, 2001..............................................................................................102

Table I.1 Anaphylaxis Covariates for Three Ambulatory Settings Used in Logistic Regression Models, 

Medicare Fee-for-Service, 2001 .......................................................................................................................103

Table I.2 Parameters from Logistic Regression for Anaphylaxis within 7 Days of MRIs (Brain) with 

Contrast for Three Settings, Medicare Fee-for-Service, 2001..........................................................................103

Table I.3 Parameters from Logistic Regression for Anaphylaxis within 7 Days of MRIs (Brain) without 

Contrast for Three Settings, Medicare Fee-for-Service, 2001..........................................................................104

Table I.4 Parameters from Logistic Regression for Anaphylaxis within 30 Days of All MRIs (Brain) for 

Three Settings, Medicare Fee-for-Service, 2001 ..............................................................................................104

Table I.5 Parameters from Logistic Regression for Anaphylaxis within 30 Days of MRIs (Brain) with 

Contrast for Three Settings, Medicare Fee-for-Service, 2001..........................................................................105

Table I.6 Parameters from Logistic Regression for Anaphylaxis within 30 Days of MRIs (Brain) without 

Contrast for Three Settings, Medicare Fee-for-Service, 2001..........................................................................105

Table I.7 Parameters from Logistic Regression for Anaphylaxis within 7 Days of All MRIs (Brain) for 

Two Settings, Medicare Fee-for-Service, 2001 ................................................................................................106

Table I.8 Parameters from Logistic Regression for Anaphylaxis within 7 Days of MRIs (Brain) with 

Contrast for Two Settings, Medicare Fee-for-Service, 2001............................................................................106

Table I.9 Parameters from Logistic Regression for Anaphylaxis within 7 Days of MRIs (Brain) without 

Contrast for Two Settings, Medicare Fee-for-Service, 2001............................................................................107

Table I.10 Parameters from Logistic Regression for Anaphylaxis within 30 Days of All MRIs (Brain) for 

Two Settings, Medicare Fee-for-Service, 2001 ................................................................................................107

Table I.11 Parameters from Logistic Regression for Anaphylaxis within 30 Days of MRIs (Brain) with 

Contrast for Two Settings, Medicare Fee-for-Service, 2001............................................................................108

Table I.12 Parameters from Logistic Regression for Anaphylaxis within 30 Days of MRIs (Brain) without 

Contrast for Two Settings, Medicare Fee-for-Service, 2001............................................................................108

viii
Summary 

The research described in this report focuses on three medical procedures performed 

frequently in multiple ambulatory settings in the Medicare population. The study procedures 

(cataract surgery, colonoscopy, and magnetic resonance imaging of the head, neck, and brain) 

were selected in a previous study based on having high volume in two or three settings in 

addition to potential safety concerns. The current study was designed to answer two questions. 

First, are there significant differences between ambulatory settings in the characteristics of the 

Medicare patients having these three high-volume procedures that might be expected to increase 

the facility cost? Second, are there significant differences between the settings in risk-adjusted 

rates of adverse outcomes following the three procedures? 

Overview of Methods. We addressed these questions by selecting and analyzing a set of 

characteristics and outcomes using enrollment and claims data for a 5 percent sample of 

Medicare beneficiaries for calendar year 2001. To address the first question above, we consulted 

a few clinical experts to help select a subset of patient characteristics for each procedure that 

might increase the facility cost (i.e., the non-physician portion of the service). The measures 

were then compared across settings with statistical testing. It is important to note that the 

characteristics were not formally evaluated by a large panel of clinical experts, nor did RAND 

quantify the relationship between each characteristic and actual cost. To investigate the second 

question above, we selected outcomes for each procedure based on input from a few clinical 

experts, frequency of occurrence, and formal ratings of preventability and severity from a large 

expert panel (conducted as part of a previous study). Conditions that were considered by our 

clinical advisors to be possible indications for having the procedure were eliminated. For each 

outcome, we constructed multiple logistic regression models to calculate risk-adjusted rates for 

each setting. 

Cataract Surgery. We analyzed data for 77,294 patients who underwent cataract surgery 

in 2001. Of these, 47 percent were performed in an OPD and 53 percent in an ASC. A set of 22 

patient characteristics was selected based on clinical expert opinion, including general medical 

and ophthalmologic comorbidities, that might increase the facility cost of performing cataract 

ix
surgery in an outpatient setting. Two-thirds of the characteristics, including all nine of the eyerelated conditions, occurred rarely with rates of less than 5 per 1000. Of the 22 characteristics, 

18 were more common among OPD patients than ASC patients, 11 of which were significantly 

more common (age over 85 years, dementia, acute episode of COPD, prescription drug 

dependence, alcohol abuse, schizophrenia, tremor, pseudoexfoliation of lens capsule, progressive 

high myopia, dislocation of lens, and posterior synechiae). 

From the list of 30 possible adverse outcomes following cataract surgery that was 

assembled during the Phase 1 study, we selected four conditions for further analysis. In the 

current study, all four of the adverse outcomes occurred infrequently following cataract surgery, 

with risk-adjusted rates ranging from less than 0.1 per 1,000 (iris prolapse) to 1.6 per 1,000 

(endophthalmitis). The rate of endophthalmitis was significantly higher in the 30 days after 

cataract surgery among patients in the OPD than in the ASC. The rates of the other three 

outcomes (cataract fragments, persistent corneal edema, and iris prolapse) were slightly but not 

significantly higher in the OPD patients. 

Colonoscopy. We analyzed data for 90,890 patients who had a colonoscopy in 2001. Of 

these, 70 percent were performed in an OPD, 26 percent in an ASC, and 4 percent in a physician 

office. A set of 18 patient characteristics was selected based on clinical expert opinion, 

including general medical and gastrointestinal (GI) comorbidities that might increase the facility 

cost of performing colonoscopy in an outpatient setting. Most of the medical characteristics 

(excluding age) occurred infrequently with rates of less than 10 per 1000 while the four GI 

conditions were found somewhat more often. Of the 18 characteristics, 10 (7 medical and 3 GI) 

were found significantly more often among OPD patients than ASC patients (age over 85 years, 

recent unstable angina, dementia, acute episode of COPD, acute episode of 

cardiomyopathy/heart failure/pulmonary edema, malignant hypertension, prescription drug 

dependence, past bowel obstruction, past colorectal cancer, and melena). Four characteristics 

were significantly more common among OPD patients than office patients (age over 85 years, 

acute episode of COPD, prescription drug dependence, and allergy to analgesic agent). The 

office rates were significantly higher than OPD and ASC rates for 4 characteristics (recent 

unstable angina, malignant hypertension, past colorectal cancer, and melena). In addition, the 

office rate was significantly higher than the ASC for cardiomyopathy/heart failure/pulmonary 

x
edema and inflammatory bowel disease, and the ASC rate was significantly higher that the office 

rate for allergy to analgesic agent. 

From the list of 20 conditions assembled during the Phase 1 study, we selected two 

conditions for further analysis as possible adverse outcomes following colonoscopy. One of the 

two, splenic rupture, was dropped because there were no cases. The other outcome, perforation, 

occurred at a rate of less than 2 per 1000 within 30 days of colonoscopy in all the settings and 

subgroups. ASC patients had significantly higher rates of perforation among all, RBC, and nonRBC colonoscopies than the OPD patients, and somewhat higher rates than the office patients. 

(RBC refers to a subset of colonoscopies that entail removal, biopsy, or control of bleeding.) 

MRI of the head, neck, and brain. We analyzed data for 40,497 patients who had an 

MRI (brain) in 2001. Of these, 52 percent were performed in the OPD, 36 percent in the office, 

and 11 percent in the IDTF. A set of 11 patient characteristics was selected based on clinical 

expert opinion, including general medical and neurological conditions that might increase the 

cost of performing an MRI (brain) in an outpatient setting. For 5 characteristics, the rates among 

office patients were significantly higher than among OPD and IDTF patients (age over 70 years, 

recent unstable angina, orthopnea, dementia, and tremor). Office patients also had a 

significantly higher rate of anxiety than OPD patients. The only characteristic for which the 

OPD rate was significantly higher than the office rate was cerebral edema. Compared to patients 

in the OPD, rates among patients in the office and IDTF combined were similar for most 

characteristics. However, office/IDTF patients had a significantly higher rate than OPD patients 

for three characteristics (age over 70 years, dementia, and tremor) and a significantly lower rate 

for cerebral edema. However, the magnitudes of all of the differences between settings, 

including those that were statistically significant, are small. 

From the list of 19 conditions assembled during the Phase 1 study, we selected one 

condition, anaphylaxis/anaphylactoid reaction, for further analysis as a possible adverse outcome 

following MRI (brain). Only 3 cases of anaphylaxis, one per setting, were identified on claims 

with dates of service within 7 days of the procedures. Two of the 3 cases of anaphylaxis 

occurred in patients who had an MRI without contrast. This finding might indicate an error in 

coding on the claim, meaning the code on the claim was for an MRI without contrast, but the 

xi
procedure was actually an MRI with contrast. Another explanation might be that the patient had 

a reaction to another allergen (e.g., peanuts or bee sting) during the same time frame. 

Conclusion. Our study extends research on the topic of differences among ambulatory 

settings in the characteristics and outcomes of the three study procedures in two ways. First, we 

incorporated clinical expertise into the selection of patient characteristics and outcomes. 

Second, we assessed differences between the settings using appropriate statistical methods, 

allowing us to evaluate the results in a more scientifically rigorous manner and, therefore, to 

assign more weight to the conclusions. 

Using claims data to examine potential differences in quality and processes of care across 

ambulatory settings has several advantages, including they are routinely collected, relatively 

inexpensive to analyze, and available relatively quickly. However, outcomes can be difficult to 

measure using administrative data because coded diagnoses are vague with no indication of the 

severity of a condition. In addition, attributing an outcome to a particular procedure is often 

problematic and it might be difficult to distinguish a potential complication of the procedure 

from the symptoms that created the need for the procedure. 

We conclude the following: 

• Observed rates for most characteristics thought to affect the cost of performing 

the three study procedures are very low in all settings. 

• Looking across all three services and all settings, no single setting had patients 

with consistently higher rates of characteristics that might increase the cost of 

performing the service. The characteristics we examined were not formally 

evaluated by a large panel of clinical experts, nor did RAND quantify the 

relationship between each characteristics and actual cost. 

• Observed rates for adverse outcomes are also very low in all settings, so that the 

magnitudes of significant differences between settings are quite small. 

Although there are some significant differences between the settings, both in terms of the type of 

patients who are treated in the setting and in the outcomes following cataract surgery and 

colonoscopy, the lack of consistent patterns across the three study procedures might make it 

xii
difficult to draw general conclusions about differences in care provided in the various 

ambulatory settings. The study, however, still contributes useful information that will inform 

policy decisions related to this topic. 

xiii

Acknowledgments 

We are grateful to the Medicare Payment Advisory Commission (MedPAC) for funding 

this research. We appreciate the valuable input we received throughout the project from our 

Project Officer at MedPAC, Ariel Winter, and from Sarah Thomas, also of MedPAC. Ariel 

arranged for access to the data and offered helpful suggestions on every aspect of the research as 

well as on a draft of this report. We are also grateful to the three clinical consultants, Dr. 

Christopher Chang, Dr. Irene Kuo, and Dr. Kenneth Ong, for the time and effort spent to help us 

understand important clinical issues related to performing colonoscopy, cataract surgery, and 

magnetic resonance imaging of the head, neck, and brain, respectively, in the various ambulatory 

settings. We would also like to express our appreciation to Arlene Turner of Social and 

Scientific Systems, Inc., for creating the files containing the variables related to the risk score. 

xv

List of Abbreviations 

Abbreviation Definition 

AICD Automatic implantable cardioverter defibrillator 

AMI Acute myocardial infarction 

APC Ambulatory Payment Classification 

ASC Ambulatory surgical center 

CMS Centers for Medicare and Medicaid Services 

COPD Chronic obstructive pulmonary disease 

CRNA Certified Registered Nurse Anesthetist 

DRG Diagnosis-related group 

HCC Hierarchical Condition Category 

OPD Hospital outpatient department 

ICD-9-CM International Classification of Disease, 9th Revision, Clinical 

Modification 

IDTF Independent diagnostic testing facility 

MedPAC Medicare Payment Advisory Commission 

MRI Magnetic resonance imaging 

MTUS Miles, Time; Units, Services Count 

RBC Removal, biopsy, or control of bleeding 

SAF Standard Analytical File 

SSS Social and Scientific Systems, Inc. 

xvii

1. Introduction 

Technological advances such as improved anesthesia and pain management coupled with 

health care financing changes have produced a shift in many services from inpatient to outpatient 

settings. As a result, both the volume and complexity of procedures provided in ambulatory 

settings have increased. Very little is known, however, about the effect of the shift from 

inpatient to ambulatory care on quality of care and how patient and procedure characteristics 

vary among ambulatory settings. 

In 2003-2004, RAND conducted a study for the Medicare Payment Advisory 

Commission (MedPAC) to provide them with information on this topic. The objectives of the 

earlier study (referred to as the Phase 1 study) were to identify high-volume services provided in 

multiple ambulatory settings and to examine the feasibility of using administrative data to 

analyze how the nature of a service, the patient characteristics, and outcomes vary by the setting 

in which the service is provided. We have described the results of this study in a previous report 

(Wynn et al., 2004). 

Overview of Phase 1 Study 

In the Phase 1 study, RAND, in conjunction with MedPAC and Social and Scientific 

Systems, Inc., used 2001 Medicare Part B claims data for a 5% beneficiary sample to identify 

high volume procedure groupings provided in at least two of four ambulatory settings: 

ambulatory surgical center (ASC), hospital outpatient department (OPD), physician office 

(office), and independent diagnostic testing facility (IDTF). MedPAC, in consultation with 

RAND, then reviewed the high volume procedures to select three procedures for further study. 

The high volume procedures that were considered potential candidates for further study met two 

basic criteria: 

• the procedure was performed in at least two sites of care (>10% of total volume in each 

site); and, 

• the procedure was among the top 25 multi-site procedures in terms of total volume or 

expenditures. 

1
_________________ 

The objective was to choose a diverse set of high volume study procedures that vary by type 

(e.g., surgical vs. non-surgical), that have potential safety concerns, and to include at least the 

three ambulatory care settings in the study. 

Three high-volume procedures were selected: cataract surgery, colonoscopy, and 

magnetic resonance imaging of the head, neck, and brain. Together, the procedures account for 

about 2.4 percent of the volume and 17.0 percent of payments for diagnostic and therapeutic 

procedures in ambulatory settings1 (Wynn et al., 2004). 

Cataract removal surgeries are among the most common surgeries performed in the 

United States (National Eye Institute, 2003). Most cataract removal surgeries are uncomplicated 

and lead to improved visual acuity and patient satisfaction. In some cases, however, 

postoperative complications related to the eye arise. In other cases, complications occur from 

the sedation or anesthesia used during the procedure, as well as from the local (injected) 

anesthesia (Shugarman et al., 2004). 

Colonoscopies are commonly performed procedures used to screen for colorectal cancer, 

but they are also used to diagnose the causes of unexplained changed in bowel habits, which may 

be caused by cancer or some other disease/condition. Therapeutic colonoscopies can be 

performed to remove polyps and to treat bleeding in the colon. Generally, the procedure is 

performed under some level of sedation and/or with pain medication. Most colonoscopies are 

uncomplicated and effectively diagnose and treat various gastrointestinal conditions. However, 

intra-operative and post-operative complications might arise, including some conditions related 

to the colon and others unrelated to the colon but associated with sedation (Shugarman et al., 

2004). 

Magnetic resonance imaging of the head, neck and brain (referred to as MRI (brain)) is 

generally considered to be a non-invasive procedure used for diagnostic purposes. Cranial and 

spinal MRI may be performed with or without contrast agents. Contrast agents are used to help 

providers to detect and characterize lesions. In general, performing MRI (brain) is associated 

with few adverse outcomes. Certain subgroups of patients are at higher risk of complications, 

1 This calculation does not include evaluation and management services, professional anesthesia services, outpatient rehabilitation therapy 

services and laboratory tests, DME, drugs and medical supplies, and outpatient dialysis and accounts only for professional and facility services 

provided in physician offices, ASCs, OPDs, and IDTFs. 

2
including those with certain types of cardiac pacemakers, metallic vascular aneurysm clips, 

ferromagnetic devices, and metallic fragments in the orbit, as well as those with claustrophobia 

(Shugarman et al., 2004). Because of safety concerns, MRI (brain) is contraindicated for some 

patients with metallic foreign bodies or implants. In general, however, patients without 

contraindications undergo non-contrast MRI (brain) without experiencing adverse events. 

Patients undergoing contrast-enhanced MRI (brain) also have few adverse reactions. 

As part of the Phase 1 study, we conducted three expert panel meetings, one for each of 

the selected procedures. Panelists were asked to rate the study procedure on several dimensions: 

the preventability and severity of selected adverse outcomes, patient characteristics that might 

affect where care is delivered, and procedure characteristics that might affect the appropriateness 

of furnishing the services in particular settings to patients at different risk levels. During Phase 

1, the panel ratings were used to select a subset of the patient characteristics and outcomes for 

analysis using administrative data. Focusing on this subset of measures, we tested the feasibility 

of using 2001 claims data for Medicare fee-for-service beneficiaries to measure differences 

among the ambulatory settings. We compared patient characteristics (i.e., demographics, 

Medicare status, and comorbidities) among ambulatory settings that might affect the resources 

required to perform the procedure. The rationale for these analyses was that performing a 

diagnostic or surgical procedure on a medically complex patient or patient with a particular 

condition such as dementia may require more facility resources. We also compared outcome 

rates among ambulatory settings. However, we did not control for differences in patient 

characteristics across settings such as age and specific comorbidities (e.g., diabetes) that might 

affect the risk of a post-procedure complication. It was recognized at the time that these 

analyses should be conducted with risk adjustment before any conclusions were drawn 

concerning differences in complication rates across ambulatory settings. 

Objectives of Current Study 

As a followup to the Phase 1 study, MedPAC requested that RAND conduct a study to 

perform more in-depth analyses related to patient characteristics and adverse outcomes. As part 

of the current study, MedPAC requested that RAND: 

3
_________________ 

• Identify patient characteristics that would be expected to increase the facility cost 

of performing the three procedures and test for significant differences in the rates 

across the settings. 

• Recommend a set of outcome measures for the three procedures for further 

analysis using risk adjustment. 

• Conduct analyses for the selected outcomes that would allow comparison of riskadjusted outcome rates among the ambulatory settings for each procedure. 

These analyses are considered prerequisites for evaluating quality and policy issues such as the 

appropriateness of site-of-service payment differentials across ambulatory settings for the same 

procedure.2 

Organization of This Report 

This report consists of four sections. Section 2 describes the study methods, including 

how the outcomes and patient characteristics were selected, data sources, file construction, the 

analytic samples, and the statistical methods used to conduct the analyses of the Medicare claims 

data. Section 3 provides the results of the claims analyses, including a comparison across 

settings of the percentage of patients with selected characteristics and comorbidities that might 

be expected to increase the facility cost of performing the procedure and of the risk-adjusted 

rates of adverse outcomes and. Section 4 discusses the overall findings and conclusions from the 

study. Following these sections, we provide appendices containing the background of the 

clinical consultants, the diagnosis and procedure codes used to identify the procedures, patient 

characteristics, and outcomes, and detailed results of the analysis. 

2 While the issue of when care is provided appropriately in an inpatient vs. outpatient setting remains an important issue, the study focus is 

on the variations in procedures performed in ambulatory settings. Medicare site of service payment differentials for ambulatory procedures may 

adversely affect beneficiary access to appropriate care or the efficient delivery of needed health care services. 

4
2. Methods for Selection and Analysis of Study Measures 

Using 2001 administrative data for Medicare beneficiaries, we studied selected patient 

characteristics and outcomes of three high-volume procedures that are commonly performed in 

multiple ambulatory settings. The three study procedures are cataract surgery, colonoscopy, and 

MRI (brain). The objectives of these analyses were to: 

• Identify patient factors that are likely to increase the facility cost of performing the three 

study procedures. Examine whether the percentage of patients with these factors varies 

by setting. 

• Refine the outcome measures for the three study procedures developed by RAND in the 

Phase 1 study. Select measures that represent adverse events, rather than the patient’s 

underlying condition, and select tools to adjust the outcome measures for patient 

characteristics. 

• Calculate rates of adverse outcomes for the three study procedures for each ambulatory 

setting in which they are provided. The rates should be adjusted for differences in the 

characteristics of patients treated in each setting. 

Below we describe the methods employed to accomplish these objectives. We first explain how 

we selected both the outcomes for risk adjustment and patient characteristics that might increase 

the facility costs of performing the procedure. We then describe the data sources, construction of 

the analytic files, the sample definition, and calculation and statistical analysis of the measures. 

The results of the empirical analyses of the patient characteristics and the outcomes are presented 

in Section 3 for the three study procedures. 

Selection of Measures 

Use of Clinical Consultants 

To ensure the project was guided by sound medical expertise, three clinical consultants 

were recruited to be advisors throughout the project. One specialist for each of the three 

procedures was selected: an ophthalmologist for cataract surgery, a gastroenterologist for 

5
_________________ 

colonoscopy, and a neuroradiologist for MRI (brain).3 The project physician (internal medicine) 

coordinated the input from the three consultants throughout the selection of outcomes and patient 

characteristics. 

At the beginning of the project, the consultants were provided with an overview of the 

project and its objectives. They were assigned four tasks related to the project objectives. The 

first task was to identify patient characteristics that might increase the facility costs of 

performing the procedure. The second task was to assist in the selection of outcomes. The third 

task was to select patient characteristics (i.e., covariates) that should be used for risk-adjustment 

in the multivariate analysis of the outcomes. The final task was to comment on the proposed 

followup periods for each outcome to be used in the claims analysis. To facilitate each of these 

tasks, the consultants were asked to provide written comments in a spreadsheet generated 

specifically for this purpose. This process is described in more detail below. 

Selecting Patient Characteristics Related to Facility Costs 

MedPAC asked RAND to identify patient characteristics and comorbidities that might 

increase the facility cost of delivering the three procedures. We developed a list of possible 

measures based on the characteristics on the rating sheets used during the three Phase 1 panel 

meetings and information from the clinical expert panel discussion in the report by Wynn et al. 

(2004). The clinical consultants reviewed the list of patient characteristics for the procedure 

within their area of expertise and indicated whether each patient characteristic might increase the 

facility cost of performing the procedure.4 It is important to note that the characteristics were 

not formally evaluated by a large panel of clinical experts, nor did RAND quantify the 

relationship between each characteristic and actual cost. The Phase 1 lists for cataract surgery, 

colonoscopy, and MRI (brain) contained 61, 54, and 45 characteristics, respectively. The 

consultants provided written comments explaining why they thought the facility cost would 

increase if a patient had the condition or characteristic (see Appendix C). They also indicated 

whether or not each characteristic was likely to appear in claims data (i.e., to be coded on a claim 

by a clinician). 

3 We describe the backgrounds of the three clinical consultants in Appendix A. 

4 The project physician also reviewed the lists for the three procedures. In addition to providing this information, the clinical consultant for 

cataract surgery also included characteristics that might increase the physician cost. 

6
Selecting Adverse Outcomes for Risk Adjustment 

MedPAC also requested that RAND recommend between four and seven outcome 

measures for each of the three procedures for further analysis using risk adjustment. The 

selection process began with the project physician and clinical consultants reviewing a list of 

adverse outcomes that could be indications for having the procedures. The project physician 

reviewed the lists for all three procedures. The consultants reviewed the list of outcomes for the 

one procedure within their specialty. The outcome lists that they reviewed had been generated 

for the expert panel during the Phase 1 study. The consultants considered each outcome to 

identify which can be indications for (i.e., reasons for having) the procedure. They were also 

asked to indicate which outcomes would be likely to be coded in medical claims data. Based on 

this information, we selected a subset of outcomes from each list that are not indications for the 

procedure. Any condition on the outcome list that can be an indication for the procedure was 

eliminated from consideration as a measure for further analysis. This step was necessary 

because, based on claims data, it is not possible to determine conclusively whether an outcome 

occurred for the first time following the procedure, or whether the outcome was a pre-existing 

condition that was the reason the procedure was performed. 

We selected outcome measures for further analysis on the basis of several factors. We 

attempted to identify adverse outcomes that are severe, preventable, and occur frequently enough 

to produce stable estimates. To facilitate this process, we created a table for each procedure 

containing rows representing the outcome measures and columns representing: 

• the preventability scores, 

• the severity scores, 

• the incidence of the outcome (per 1000 procedures), and 

• whether the outcome could be an indication for the procedure. 

The preventability and severity scores in the tables were derived from the rating sheets 

completed by the members of the three expert panels conducted during the Phase 1 study. 

Outcome rates used in this process were derived from the results in the Phase 1 report (Wynn et 

al., 2004). We used the information in these tables together with the clinical input from the 

project physician and the clinical consultants as the basis for recommending outcome measures 

for further analysis. 

7
As part of reviewing the outcome measures, each clinical consultant also reviewed a list 

of patient characteristics and comorbid conditions for the one procedure within their specialty. 

The purpose of the review was to identify covariates to be used in the multivariate analyses. The 

lists that they reviewed had been generated for the expert panel during the Phase 1 study. For 

each patient characteristic, the consultant was asked to comment on whether it would increase 

the likelihood of any of the outcomes occurring, and to provide details about the association 

between the characteristic and the outcome. They also indicated whether or not the 

characteristic was likely to appear in claims data (i.e., to be coded on a claim by a clinician). 

The list of possible covariates included demographic characteristics (e.g., age, gender, and race), 

Medicaid eligibility, and disability status as well as comorbidities (e.g., diabetes) that might 

affect the occurrence of a particular adverse outcome. 

For each outcome, each consultant assessed whether 7 or 30 days following the 

procedure would be a more appropriate timeframe for identifying each outcome in the claims 

data based on the likelihood of the outcome being the result of the procedure. Information from 

the Phase 1 panel discussions was also considered in determining the most appropriate time 

frame for measuring each outcome. 

Analysis of Administrative Data 

Data Sources 

For these analyses, the enrollment and demographic variables for Medicare beneficiaries 

were derived from the Centers for Medicare and Medicaid Services (CMS) 5% Denominator 

File. All variables related to inpatient and outpatient utilization (e.g., indicators based on 

diagnosis and procedure codes) were derived from Medicare Part A and Part B claims. The 

variables related to utilization of inpatient and outpatient care by Medicare beneficiaries were 

extracted from claims represented in the 5% Physician/Supplier Standard Analytical File (SAF), 

the 5% Hospital Inpatient SAF, and the 5% Hospital Outpatient SAF. Social and Scientific 

8
_________________ 

Systems, Inc. (SSS) assigned Hierarchical Condition Categories (HCC) risk scores and other 

variables related to the HCC for 2001 using 2000 administrative data.5 

Analyzing claims data has several advantages, including they are routinely collected, 

inexpensive to analyze, and available quickly (Wynn et al., 2004). However, comorbidities and 

outcomes can be difficult to measure using administrative data because clinical detail is lacking 

and data elements not directly related to payment might be unreliable. ICD-9-CM diagnosis 

codes may be vague (e.g., heart failure, unspecified) and contain symptoms (e.g., fatigue) as well 

as diseases. In addition, the nomenclature provides only limited indicators of the severity of a 

condition. This makes identifying specific clinical outcomes following a procedure challenging. 

In addition, attributing outcomes to particular procedures is often problematic. Some conditions 

of interest are also unlikely to be coded or coded incompletely on claims. The limitations of 

claims data do not mean that they should not be used for clinically-based measures; however, 

they should be used with some caution. 

One issue that might affect the claims data for services furnished in ambulatory settings 

is the rules used to define inpatient hospital services under the prospective payment system 

(PPS) for acute care hospitals (CMS, 2006).6 As a result of these rules, analyses using OPD 

claims data do not include sicker patients who received a service as an outpatient but whose 

conditions necessitated a hospital admission that led to the study procedure being redefined as an 

inpatient service. The policies are most likely to impact the MRI analyses, assuming patients are 

more likely to be admitted following an MRI. However, they might also affect findings 

comparing patient characteristics and outcomes across settings for colonoscopies and to a lesser 

extent cataract surgeries. However, because our study is focused on the services that are covered 

under Medicare Part B, it is appropriate that the comparisons exclude those who are defined as 

inpatients for payment purposes. 

5 The HCC model assigns a risk score based on a beneficiary’s expected service use relative to that of the national average beneficiary, 

given their demographic characteristics (e.g., age and gender) and medical conditions. It can be used to identify patients who are likely to have 

complex medical needs. Such patients might be at higher risk for complications than other patients and may require closer monitoring throughout 

a surgical procedure and recovery. 

6 Diagnostic services provided to a beneficiary by the admitting hospital (or by an entity wholly owned or operated by the hospital) within 3 

days prior to the date of the beneficiary's admission for a covered inpatient stay are deemed to be inpatient services and included in the PPS 

payment (CMS, 2006). MRI procedures are defined as diagnostic procedures for purposes of this provision. Therefore, there are no OPD claims 

for beneficiaries who receive an MRI as an outpatient and are subsequently admitted within 3 days to the same hospital. Moreover, nondiagnostic outpatient services that are furnished by the same hospital during the 3 days immediately preceding the patient’s admission and are 

related to a patient’s hospital admission are similarly defined as inpatient services. Further, any outpatient services, regardless of whether they are 

related to the admission, are considered inpatient services if the patient is admitted to the same hospital before midnight of the following day. 

9
_________________ 

File Construction 

The analytic files for our study contained enrollment data and claims for care (inpatient 

and outpatient) provided during calendar year 2001 (CY2001) to Medicare beneficiaries who had 

one of three study procedures between January 1 and December 31, 2001.7 The three 

procedures, which we refer to as index procedures, were: MRI (brain) (BETOS I2C), cataract 

removal/lens insertion (BETOS P4B), and colonoscopy (BETOS P8D). The CPT codes included 

in each procedure grouping are listed in Appendix B. To be included in the sample, beneficiaries 

must have had the procedure performed in one of four ambulatory settings: 

• Hospital outpatient department (OPD) 

• Ambulatory surgical center (ASC) 

• Physician office (Office) 

• Independent diagnostic testing facility (IDTF) 

Social and Scientific Systems, Inc. (SSS) created extract files containing all records from the 5% 

Denominator file, the 5% Physician/Supplier SAF, the 5% Inpatient SAF, and the 5% Outpatient 

SAF for the beneficiaries with one of the three procedures. From these files, we created four 

mutually exclusive files for each of the three index procedures. The four files were: 

1. Index Procedure File: A standardized record for each index procedure performed during 

CY2001. Each record in this file represents one index procedure and related services 

received on the same date as the index procedure and includes variables from the 

Denominator File and variables that relate to the index procedure from the various 

SAFs, including diagnoses, provider specialties, and other procedures. 

2. Physician/Supplier Claim File: All physician/supplier claims for care received in any 

setting during CY2001 for beneficiaries with an index procedure performed during 

CY2001. 

3. Inpatient Claim File: All facility claims for care received in an inpatient hospital during 

CY2001 for beneficiaries with an index procedure performed during CY2001. 

4. Hospital Outpatient Claim File: All facility claims for OPD care received during CY2001 

for beneficiaries with an index procedure performed during CY2001. 

The claims in Files 2 through 4 do not include the care (i.e., anesthesia and all other care) in the 

index procedure file. In addition, the care in these files is not necessarily related to the index 

7 We used administrative data for 2001 because the data files were built in 2003 for the Phase 1 analyses. 

10
_________________ 

procedure (e.g., MRI (brain)). Claims for durable medical equipment, skilled nursing facilities, 

home health agencies, and hospice are not included in these analyses. 

The index procedure file contains a single fixed length record for each index procedure 

with a standardized set of variables, regardless of which ambulatory setting the procedure was 

performed in. A beneficiary can have more than one record in the index procedure file if s/he 

had more than one index procedure (MRI (brain), cataract surgery, or colonoscopy) on different 

dates in 2001. The three index files include records for all procedures with the HCPCS (CPT) 

codes included in the BETOS categories for MRI (brain) (BETOS I2C), cataract removal/lens 

insertion (BETOS P4B), and colonoscopy (BETOS P8D) (Appendix B). In addition, the cataract 

file included one other code, CPT 66820, which is in BETOS P4E (Eye procedure-other) based 

on clinical input.8 All variables in the index procedure file record were derived from one or more 

claims for the index procedure. 

For index procedures performed in an ASC or IDTF, the record generally contains 

variables from a physician/supplier SAF claim for the facility service and from a 

physician/supplier SAF claim for the related physician services. For index procedures 

performed in the OPD, the record generally contains variables from an outpatient SAF claim 

(i.e., facility) and from a physician/supplier SAF claim. For index procedures performed in a 

physician office, the record only contains variables from a physician/supplier SAF claim. 

Claims for anesthesia services furnished in conjunction with the index procedure in any of the 

sites were identified in the physician/supplier file and added to the index procedure record. 

Variables in the index procedure files included diagnosis and procedure codes from the 

facility and physician claims, as well as the date of service, modifier codes, and provider 

specialty for each procedure. The 2001 HCC risk score (based on 2000 data) for each 

beneficiary was merged onto the record from a file created by SSS prior to this project. Separate 

variables for diagnosis and procedure codes, modifier codes, and provider specialty were created 

for anesthesia-related services. In addition, variables for the length of anesthesia time were 

included for each anesthesia code. 

8 CPT code 66820 is defined as “Discission of secondary membranous cataract (opacified posterior lens capsule and/or anterior hyaloid); 

stab incision technique (Ziegler or Wheeler knife).” 

11
_________________ 

Analytic Samples 

We restricted the sample to beneficiaries who were enrolled in both Part A and Part B of 

Medicare and were in traditional fee-for-service Medicare for at least one month during CY2001. 

We excluded beneficiaries who were enrolled in a Medicare managed care organization because 

utilization data for their inpatient and outpatient care are not available. In calculating each 

measure, we included all beneficiaries who were enrolled in Medicare fee-for-service for at least 

one month following the procedure (the period used in these analyses to measure most of the 

adverse outcomes). 9 

The cataract analytic sample included all cataract surgeries that were performed on 

Medicare fee-for-service patients in two ambulatory settings (OPD and ASC) during 2001. We 

excluded cataract surgeries that were performed in physician offices because they comprise a 

small percentage of the procedures.10 

The colonoscopy analytic sample included all colonoscopies that were performed on 

Medicare fee-for-service patients in three ambulatory settings (OPD, ASC, and physician office) 

during 2001. We first analyzed all colonoscopies. We then categorized the colonoscopies into 

two subgroups based on the HCPCS codes: those with some lesion removal, biopsy, or control of 

bleeding (RBC) and those without RBC (non-RBC) and analyzed these two subsamples 

separately.11

The MRI analytic sample included all MRIs (brain) that were performed in three 

ambulatory settings (OPD, physician office, and IDTF) during 2001. We first analyzed all MRIs 

(brain). We then separated them into two categories based on HCPCS codes: those with a 

contrast agent and those without a contrast agent and analyzed these two subsamples 

separately.12 

9 For procedures performed in December, we searched for the outcome through December 31, 2001. 

10 During 2001, only 278 of 77,572 cataract surgeries among Medicare fee-for-service patients were performed in a physician office (Wynn 

et al., 2004). 

11 The HCPCS codes for RBC colonoscopy are 44389, 44391, 44392, 44393, 44394, 45379, 45380, 45382, 45383, 45384, 45385, and 

45387. The HCPCS codes for “non-RBC” colonoscopy are 44388, 45378, and G0105. 

12 The HCPCS codes for MRI with contrast are 70541, 70542, 70543, 70545, 70546, 70548, 70549, 70552, and 70553. The HCPCS codes 

for MRI without contrast are 70544, 70547, and 70551. 

12
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Analysis of Patient Characteristics 

We constructed algorithms to define each patient characteristic that might affect facility 

costs, specifying the measure in terms of diagnosis (ICD-9-CM) or procedure codes (CPT, 

HCPCS, and ICD-9-CM), and the time frame identifying the characteristic (see Appendix C for 

the specifications for the patient characteristics). We searched claims for all care received 

during 2001 in all settings of care (inpatient, outpatient, ASC, IDTF, and office) to identify each 

patient characteristic. In addition, we used variables representing individual medical conditions 

that were generated by the HCC risk score program. Each of these (0, 1) variables indicated 

whether a particular diagnosis code or set of codes appeared on a patient claim during calendar 

year 2000. HCCs representing specific conditions (e.g., diabetes) are assigned based on 

diagnoses from the following sources: principal hospital inpatient, secondary hospital inpatient, 

hospital outpatient, physician, and clinically trained non-physician (e.g., psychologist) (Pope et 

al., 2004). These HCC dummy variables for specific conditions are calculated as part of the 

program that assigns the predicted expenditures for the patient in the following year. 

For each patient characteristic, we calculated a rate per 1,000 based on the number of 

procedures for patients with a particular characteristic divided by the total number of procedures. 

In comparing differences in patient characteristics among settings, the rates were estimated for 

each setting separately (OPD and ASC for cataract surgery; OPD, ASC, and office for 

colonoscopy; and OPD, office, and IDTF for MRI (brain)). In addition, the MRI rates were also 

estimated for IDTF and office combined because these two settings are paid under the same 

payment system (physician fee schedule). We calculated a single set of rates based on all 

cataract surgeries. However, for colonoscopy, we repeated the analysis for three samples (all, 

RBC, and non-RBC). Similarly, we conducted analyses on three samples for MRI (brain) (all, 

with contrast, and without contrast). We then conducted The Fisher’s exact test was used to 

determine if the differences between settings were significantly different.13 If we found this to 

be significant, we tested all of the pair-wise comparisons using frequency tables in SAS® 

Version 8.2 (SAS Institute, Inc., 2002). 

13 The Fisher’s exact test provides the exact P value rather than the approximate P value that results from the chi-square test (Afifi and 

Azen, 1979), It is used when the number of cases is small. 

13
Analysis of Outcomes 

For each outcome measure, we constructed algorithms to describe each outcome 

measure, specifying the outcome in terms of diagnosis or procedure codes (ICD-9-CM, CPT, and 

HCPCS), and the time frame following the procedure within which the outcome occurred (see 

Appendix J for the specifications for the outcome measures). We calculated the rate of all except 

one measure based on outcomes occurring within 30 days following each procedure.14 We 

searched for the outcome on claims for all settings of care (inpatient, outpatient, ASC, IDTF, and 

office). We calculated the outcome rates as the number of procedures with a particular adverse 

outcome within the specified time period divided by the number of procedures expressed as a 

rate per 1000 procedures. 

We analyzed the rate of each adverse outcome occurring within 30 days using multiple 

logistic regression methods.15 We used logistic regression because each outcome measure can 

be represented by a dichotomous variable. The unit of analysis is the individual procedure. The 

form of the logistic regression was 

= + + + + XbXbXbaodds NN )ln( ... 2211

where ln is natural log, X1 to XN are a set of N independent predictor variables, a is the 

intercept, and b1 to bN are the logistic regression coefficients. The odds are defined specifically 

as 

z

z

P

P odds − =

1

where Pz is the probability of having some characteristic, z. The equation can be written in 

terms of Pz as follows: 

[ ] ( ) NN

z XbXbXba

P

++++−+ = exp1 ...

1

2211

_________________ 14 For “anaphylaxis/anaphylactoid reaction,” we analyzed the outcome measure using two different time frames, within 7 and 30 days of 

the MRI (brain). 

15 We analyzed “anaphylaxis/anaphylactoid reaction” using two different time frames, within 7 and 30 days of MRI (brain). 

14
where exp is the constant, e, raised to the power of the expression shown. This equation is called 

the logistic regression equation. Logistic regression models control for other differences at the 

individual level that might mask the true differences between the settings. 

We included the same demographic and entitlement dummy variables in the analyses of 

all outcomes. Dummy variables representing age (under 65, 75-84 and 85 and over), gender, 

race (African-American, other), disability as original reason for entitlement, and one or more 

months of Medicaid eligibility in 2001 were included in every model. Dummy variables 

representing comorbiditiess that might alter the risk of the outcome occurring were also 

included. It is necessary to control for these differences because they may be related to risk of 

developing a particular outcome. By controlling for these factors statistically, we were able to 

measure differences in the outcome rate among the settings independent of these other factors. 

Controlling for numerous covariates in the multivariate analysis improves precision. In addition, 

dummy variables representing each ambulatory setting were also included in each regression 

equation: 

INASC=1 if the procedure was performed in an ASC 

 =0 for all others 

INOPD=1 if the procedure was performed in an OPD 

 =0 for all others 

INIDTF=1 if the procedure was performed in an IDTF 

 =0 for all others 

INOFF=1 if the procedure was performed in an office 

 =0 for all others 

These dummy variables represent the effect on the outcome rate of having the procedure 

performed in a particular setting. 

The outcome rates were estimated for each setting separately (OPD and ASC for cataract 

surgery; OPD, ASC, and physician office for colonoscopy; and OPD, physician office, and IDTF 

for MRI (brain)). In addition, the MRI outcome rates were also estimated for IDTF and office 

combined because these two settings are paid under the same payment system (physician fee 

schedule). For each cataract surgery outcome, we estimated the parameters of one logistic 

15
regression model. For the colonoscopy outcome (i.e., perforation), we estimated three logistic 

regression models (all colonoscopies, RBC colonoscopies, and non-RBC colonoscopies). For 

the MRI (brain) outcome (i.e., anaphylaxis/anaphylactoid reaction), we also estimated three 

logistic regression models (all MRIs, MRIs with contrast, and MRIs without contrast). 

The results presented in Tables 3.5, 3.6, 3.11, and 3.14 in Section 3 of this report are riskadjusted rates generated from the multiple logistic regression models described above. We used 

an approach that simulates what rates that would be expected if the same set of patients had the 

procedure performed in different settings (i.e., everything was the same except the setting). To 

calculate the risk-adjusted rates for an outcome, we first estimated the logistic regression 

equation for that outcome. We then used the parameter estimates from the equation (i.e., the 

intercept and regression coefficients) to predict the probability of the outcome occurring for each 

individual in the sample. For each outcome, a separate predicted probability was calculated for 

each setting. To generate a predicted probability for each setting, the dummy variable(s) for the 

setting(s) was (were) set equal to zero or one to simulate the values in a particular setting. For 

example, when we predicted rates for endophthalmitis (an outcome for cataract surgery), we 

calculated the predicted probability for OPD for each case in the sample by setting the dummy 

variable for ASC to zero (i.e., by “turning it off”). We then calculated the predicted probability 

for the second setting, ASC, by setting the dummy variable for ASC to one (i.e., by “turning it 

on”). We calculated these two predicted probabilities, one for OPD and one for ASC, for each 

record in the cataract surgery sample. The risk-adjusted rates presented in the Section 3 tables 

are the means of the predicted probabilities for each setting. 

Statistical significance of differences in the risk-adjusted rates between the settings is 

based on the chi-square test for the logistic regression coefficient for the dummy variable 

representing a particular setting. The statistical test was performed using the LOGISTIC 

procedure in SAS® Version 9.1.2 (SAS Institute, Inc., 2002-2003). For example, the statistical 

test for the difference between the risk-adjusted perforation rates for the OPD and the ASC is 

based on the chi-square statistic for the ASC dummy variable from the model. 

16
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3. Results of Selection Process and Data Analysis 

In this section, we report the results of our analyses of CMS administrative data for a 5 

percent sample of Medicare beneficiaries who had at least one of the three study procedures in 

2001. We examined whether the rates of patients with characteristics that might increase the 

facility cost of performing the three study procedures vary by setting. We present the results for 

22 characteristics for cataract surgery, 18 for colonoscopy, and 11 for MRI (brain). 

We also determined risk-adjusted rates for the outcome measures for the three procedures 

by setting. We used multiple logistic regression models to adjust for covariates that might affect 

the rate of the outcomes (i.e., risk adjustment). We present the results for four outcome 

measures for cataract surgery, one outcome for colonoscopy, and one outcome for MRI (brain). 

Comparison of Patient Characteristics Across Settings 

As described in Section 2, we selected a subset of the patient characteristics for the 

claims analysis on the basis of the expert opinions of the project physician and the three clinical 

consultants. They were asked to identify a subset of patient characteristics that might increase 

the facility cost of performing the procedure by reviewing a list from the Phase 1 study. 

Cataract Surgery 

Based on the input of the project physician and the clinical consultant for cataract 

surgery, we selected 22 patient characteristics that might increase the facility cost of performing 

cataract surgery.16 Of the 22 characteristics, 13 relate to medical conditions unrelated to eyes 

(e.g., dementia) (first 13 measures in Table 3.1) and 9 relate to ophthalmologic conditions (e.g., 

subluxation of lens) (last 9 measures in Table 3.1). Each characteristic was identified using all 

16 We selected 23 patient characteristics for cataract surgery, but one characteristic (history of ruptured globe) could not be tested in the 

claims analysis because we were unable to identify ICD-9-CM diagnosis codes for the algorithm. 

17
Table 3.1 Characteristics of Cataract Surgery Patients By Setting, Medicare Fee-for-Service, 2001 

OPD ASC 

 Number Rate* Number Rate* 

Fisher’s exact

p-value 

All cataract surgeries 36,623 -- 40,671 -- 

Age > 85 years 4229 115.5 4030 99.1 0.000§

Dementia 1711 46.7 1585 39.0 0.000§

Chronic obstructive pulmonary disease 

(COPD) with hospitalization or 

emergency department visit within past 

one year 842 23.0 815 20.0 0.005§

Bronchietasis with acute exacerbation 12 0.3 10 0.2 0.529 

Barbiturate, chlordiazepoxide, diazepam, 

glutethimide, meprobamate, or 

methaqua-lone dependence or Opioid 

type dependence 153 4.2 121 3.0 0.005§

Alcohol abuse 951 26.0 878 21.6 0.000§

Personal history of allergy to anesthetic 

agent 6 0.2 4 0.1 0.533 

Personal history of allergy to narcotic agent 75 2.0 74 1.8 0.511 

Personal history of allergy to analgesic agent 50 1.4 50 1.2 0.617 

History of shock due to anesthesia in which 

correct substance was properly 

administered 1 0.0 0 0.0 0.474 

Anxiety 279 7.6 283 7.0 0.289 

Schizophrenic disorder 248 6.8 182 4.5 0.000§

Essential, benign, or drug-related tremor/ 

abnormal head movements, 

fasciculations, spasms or tremor not 

otherwise specified 208 5.7 156 3.8 0.000§

Subluxation of lens 12 0.3 7 0.2 0.177 

Recession of chamber angle 0 0.0 0 0.0 -- 

Pseudoexfoliation of lens capsule 40 1.1 6 0.1 0.000§

Progressive high (degenerative) 

myopia/malignant myopia 7 0.2 1 0.0 0.031§

Dislocation of lens 13 0.4 2 0.0 0.003§

History of open wound of adnexa 0 0.0 0 0.0 -- 

Endothelial corneal dystrophy, including 

combined corneal dystrophy, cornea 

guttata, and Fuch's endothelial dystrophy 65 1.8 77 1.9 0.737 

Posterior synechiae 19 0.5 4 0.1 0.001§

History of vitrectomy 140 3.8 176 4.3 0.284 

§

Comparisons in bold are significant at p<0.05. 

*Per 1,000 procedures. 

Source: RAND analysis of the 5 percent Standard Analytical Files of Medicare claims, 2001. 

18
claims for care received by the cataract surgery patients in any inpatient or outpatient setting at 

any time during 2001 unless otherwise stated in the definition of the characteristic.17 

The rates of these 22 characteristics are shown in Table 3.1 for the two settings in which 

cataract surgeries are most commonly performed, OPD and ASC.18 Two-thirds of the 

characteristics, including all of the eye-related conditions, occurred infrequently in both settings 

with rates of less than 5 per 1000. Of the others, only four of the characteristics occurred at a 

rate of more than 10 per 1000 (i.e., one percent); these are age greater than 85, dementia, COPD, 

and alcohol abuse. 

For 11 of the 22 characteristics, the rates are significantly higher among OPD patients 

having cataract surgery than ASC patients. This means that patients having cataract surgeries in 

OPDs are more likely than ASC patients to be over 85 years of age, have dementia, an acute 

episode of COPD, prescription drug dependence, alcohol abuse, schizophrenia, tremor, 

pseudoexfoliation of lens capsule, progressive high myopia, dislocation of lens, and posterior 

synechiae. For another 7 characteristics, the OPD rates are higher, but not significantly higher, 

than ASC rates. For two characteristics, the ASC rate is somewhat (but not significantly) higher 

than the OPD rate. For two of the characteristics (recession of chamber angle and history of 

open wound of adnexa), there were no patients in either setting with those conditions coded on a 

claim during 2001. 

Colonoscopy 

Based on input from the project physician and the clinical consultant for colonoscopy, we 

selected 18 patient characteristics that might increase the facility cost of performing 

colonoscopy.19 Of the 18 characteristics, 14 relate to other medical conditions (e.g., unstable 

angina) (first 14 measures in Table 3.2) and 4 relate to gastrointestinal conditions (e.g., history of 

partial or complete bowel obstruction) (last 4 measures in Table 3.2). Each characteristic 

_________________ 17 See Appendix C for definitions of each patient characteristic for cataract surgery. 

18 As described in the Methods section, cataract surgeries performed in physician offices were excluded from these analyses. 

19 We selected 19 patient characteristics for colonoscopy, but one characteristic (mechanical heart valve) could not be tested in the claims 

analysis because we were unable to find diagnosis codes to uniquely identify it. 

19
Table 3.2 Characteristics of Colonoscopy Patients By Setting, Medicare Fee-for-Service, 2001 

OPD ASC Office Fisher’s exact p-value 

Number Rate* Number Rate* Number Rate* 

OPD 

vs. 

ASC 

OPD vs.

Off 

ASC vs.

Off 

All colonoscopies 63372 -- 23503 -- 4015 -- 

Age > 70 years 42756 674.7 15844 674.1 2670 665.0 0.864 0.199 0.252 

Age > 85 years 3568 56.3 1131 48.1 181 45.1 0.000§ 0.002§ 0.423 

Unstable angina in last 3 months 355 5.6 82 3.5 39 9.7 0.000§ 0.002§,b 0.000§

MI (>30 days but fewer than 6 

months) 1 0.0 0 0.0 0 0.0 1.000 1.000 1.000 

Dementia 2201 34.7 658 28.0 131 32.6 0.000§ 0.504 0.112 

Chronic obstructive pulmonary 

disease (COPD) with 

hospitalization or emergency 

department visit within past 

year 1022 16.1 255 10.8 33 8.2 0.000§ 0.000§ 0.153 

Asthma with hospitalization or 

emergency department visit 

within past one year 0 0.0 0 0.0 0 0.0 -- -- -- 

Bronchietasis with acute 

exacerbation 15 0.2 5 0.2 3 0.7 1.000 0.088c 0.098c

Cirrhosis 500 7.9 157 6.7 33 8.2 0.071 0.783 0.301c

Cardiomyopathy/heart failure/ 

pulmonary edema with 

hospitalization or emergency 

department visit in past year 7291 115.1 2209 94.0 440 109.6 0.000§ 0.307 0.002§

Malignant hypertension 482 7.6 106 4.5 184 45.8 0.000§ 0.000§ 0.000§

Barbiturate, chlordiazepoxide, 

diazepam, glutethimide, 

meprobamate, or 

methaqualone dependence or 

opioid type dependence 331 5.2 78 3.3 11 2.7 0.000§ 0.029§,a,b 0.653 

Personal history of allergy to 

anesthetic agent 4 0.1 2 0.1 0 0.0 0.665 1.000 1.000 

Personal history of allergy to 

analgesic agent 102 1.6 37 1.6 1 0.2 1.000 0.033§,a,b 0.036§,a,b

History of partial/complete 

bowel obstruction 2246 35.4 669 28.5 124 30.9 0.000§ 0.133 0.386 

History of colorectal cancer 1587 25.0 316 13.4 154 38.4 0.000§ 0.000§ 0.000§

Inflammatory bowel disease 1128 17.8 379 16.1 103 25.7 0.095 0.001§ 0.000§

Melena 1553 24.5 275 11.7 229 57.0 0.000§ 0.000§ 0.000§

§

Comparisons in bold are significant at p<0.05. 

*Per 1,000 procedures. 

Source: RAND analysis of the 5 percent Standard Analytical Files of Medicare claims, 2001. a

 Not significant for RBC colonoscopy (see Table D.1 in Appendix D).

b

 Not significant for non-RBC colonoscopy (see Table D.2 in Appendix D). 

c

 Significant for non-RBC colonoscopy (see Table D.2 in Appendix D). 

20
was identified using all claims for care received by the colonoscopy patients in any inpatient or 

outpatient setting at any time during 2001 unless otherwise stated in the definition of the 

characteristic.20 Among the colonoscopy patients, there was only 1 patient in any of the three 

settings with an “MI in more than 30 days but less than 6 months during 2001.” For one 

characteristic (“asthma with hospitalization or emergency department visit within past one 

year”), there were no patients in any of the three settings with the condition coded on a claim 

during 2001. Most of the characteristics are uncommon with rates of less than 10 per 1000 (i.e., 

1 percent). The three most frequent characteristics are age greater than 70, age greater than 85, 

and an acute episode of cardiomyopathy/heart failure/pulmonary edema. 

The rates of these 18 characteristics are compared in Table 3.2 for the three settings in 

which colonoscopy is provided (OPD, ASC and office). For 10 of the 18 characteristics, the 

rates are significantly higher among OPD patients having colonoscopy than ASC patients. This 

means that patients having colonoscopies in OPDs are more likely than ASC patients to be over 

85 years of age, have recent unstable angina, dementia, an acute episode of COPD, an acute 

episode of cardiomyopathy/heart failure/pulmonary edema, malignant hypertension, prescription 

drug dependence, past bowel obstruction, past colorectal cancer, and melena21. There is no 

consistent pattern among these characteristics for office patients compared to OPD or ASC 

patients; rates are sometimes higher in the office setting and sometimes higher in the other 

settings. The OPD rates for 4 characteristics are significantly higher than office rates (over 85 

years, an acute episode of COPD, prescription drug dependence, and allergy to analgesic agent). 

The office rates are significantly higher than both OPD and ASC rates for 4 characteristics 

(recent unstable angina, malignant hypertension, past colorectal cancer, and melena). In 

addition, the office rate is significantly higher than the ASC for cardiomyopathy/heart 

failure/pulmonary edema and inflammatory bowel disease, and the ASC rate is significantly 

higher that the office rate for allergy to analgesic agent. 

The patterns of patient characteristics by setting for all colonoscopies (Table 3.2) are 

similar to the patterns we found for the two subsets of colonoscopies (RBC and non-RBC) (see 

Appendix D). All significant differences between settings for the RBC and non-RBC 

_________________ 20 See Appendix C for definitions of each patient characteristic for colonoscopy. 

21 Melena is defined as “presence of blood in the stool” (Hensyl, 1990). 

21
colonoscopies are in the same direction as those for all colonoscopies. Any differences in the 

significant results between this table and the tables for RBC and non-RBC are indicated in the 

footnotes on Table 3.2. 

MRI (Brain) 

Based on input from the project physician and the clinical consultant for MRI (brain), we 

selected 11 patient characteristics that might increase the facility cost of performing this 

procedure. Of the 11 characteristics, 6 relate to general medical conditions (e.g., unstable 

angina) (first 6 measures in Table 3.3) and 5 relate to conditions that might directly affect 

performing the MRI (e.g., history of claustrophobia) (last 5 measures in Table 3.3). Each 

characteristic was identified using all claims for care received by the MRI (brain) patients in any 

inpatient or outpatient setting at any time during 2001 unless otherwise stated in the definition of 

the characteristic.22 

All except three of these characteristics are found in less than 50 per 1000 (i.e., 5 percent) 

of the MRI (brain) patients (Table 3.3). The three most common characteristics are age greater 

than 70, age greater than 85, and dementia. For one characteristic (MI within past 7 days during 

2001), there were only 2 patients in the office setting with the condition coded on a claim during 

2001 and none in the other two settings. For another characteristic (MI in more than 7 days but 

fewer than 30 days during 2001), there was only one patient in the office setting. We, therefore, 

consider the pattern of results for the remaining 9 characteristics below. 

The rates of these 9 characteristics are compared in Table 3.3 for the three settings in 

which MRI (brain) is provided (OPD, office, and IDTF). For five characteristics, the rates 

among office patients are significantly higher than among OPD and IDTF patients. This means 

that patients having MRI (brain) in the office setting are more likely than OPD and IDTF 

patients to be over 70 years of age, have recent unstable angina, orthopnea23, dementia, and 

tremor. The significantly higher percentage of patients over 70 years of age in the office, 

however, probably has little clinical or cost significance, given the broad range of ages included 

in the category, and 

_________________ 22 See Appendix C for definitions of each patient characteristic for MRI (brain). 

23 Orthopnea is defined as “discomfort in breathing which is brought on or aggravated by lying flat” (Hensyl, 1990). 

22
Table 3.3 Characteristics of MRI (Brain) Patients By Setting, Medicare Fee-for-Service, 2001 

OPD Office IDTF Fisher’s exact p-value 

Number Rate* Number Rate* Number Rate* OPD vs. 

Office 

OPD vs. 

IDTF 

Office 

vs. IDTF

All MRI (brain) 21233 -- 14712 -- 4552 -- 

Age > 70 years 14279 672.5 10393 706.4 3081 676.8 0.000§ 0.589 0.000§,a

Age > 85 years 1745 82.2 1167 79.3 359 78.9 0.335 0.474 0.950 

Unstable angina in last 3 

months 142 6.7 130 8.8 19 4.2 0.022§,a 0.049§,a,b 0.001§

Myocardial infarction 

within past 7 days 0 0.0 2 0.1 0 0.0 0.168 0.168 1.000 

Recent myocardial 

infarction (> 7 days but 

fewer than 30 days) 0 0.0 1 0.1 0 0.0 0.409 0.409 1.000 

Orthopnea 27 1.3 36 2.4 2 0.4 0.010§,a 0.149 0.006§,a,b

Dementia 1917 90.3 1699 115.5 365 80.2 0.000§ 0.029§,b 0.000§

Anxiety 201 9.5 172 11.7 42 9.2 0.044§,a,b 0.933 0.195 

History of claustrophobia 9 0.4 7 0.5 4 0.9 0.805 0.264 0.301 

Essential, benign, or 

drug-related 

tremor/abnormal head 

movements, 

fasciculations, spasms, 

or tremor not otherwise 

specified 449 21.1 728 49.5 79 17.4 0.000§ 0.106 0.000§

Cerebral edema 69 3.2 15 1.0 6 1.3 0.000§ 0.032§,a,b 0.608 

§

Comparisons in bold are significant at p<0.05. 

*Per 1,000 procedures. 

Source: RAND analysis of the 5 percent Standard Analytical Files of Medicare claims, 2001. 

a

 Not significant for MRI (brain) with contrast (see Table E.1 in Appendix E). 

b

 Not significant for MRI (brain) without contrast (see Table E.2 in Appendix E). 

the proportion of patients over 85 years of age does not differ (Table 3.3). Office patients also 

have a significantly higher rate of anxiety than OPD patients. The only characteristic for which 

the OPD rate is significantly higher than the office rate is cerebral edema. OPD and IDTF rates 

are similar for most characteristics, but OPD patients have a significantly higher rate than IDTF 

patients for three characteristics (recent unstable angina, dementia, and cerebral edema). 

The patterns of patient characteristics by setting for all MRIs (brain) (Table 3.3) are 

similar to the patterns we found for the two subsets of MRI (brain) (with and without contrast) 

(see Appendix E). All significant differences between settings for the subsets of MRIs with and 

23
without contrast are in the same direction as those for all MRIs (brain). The differences in the 

significant results between this table and the tables for MRI (brain) with and without contrast are 

indicated in the footnotes on Table 3.3. 

Because services provided in offices and IDTFs are paid under the same payment system 

(physician fee schedule), we also assessed whether OPD patients differ from a combined group 

of office and IDTF patients. OPD patients have significantly lower rates than the combined 

group for three characteristics (over 70 years of age, dementia, and tremor) and a significantly 

higher rate for cerebral edema (Table 3.4). As mentioned above, the significantly higher 

percentage of patients over 70 years of age in the office/IDTF probably has little clinical or cost 

significance, given the broad range of ages included in the category and the proportion of 

patients over 85 years of age does not differ (Table 3.4). The finding of the OPD patients having 

significantly lower rates is somewhat unexpected. However, because ICD-9-CM codes do not 

indicate the severity of these conditions, we were not able to determine whether there are 

differences in the severity of cases with these conditions across the settings. In an effort to 

understand this finding, we discuss three other possible explanations. 

The first possible explanation for this finding relates to Medicare’s hospital outpatient 

payment rules. The rules define as inpatient services any outpatient diagnostic services provided 

by a hospital within three days prior to admission and, therefore, are included in the PPS 

payment (see Methods section for a description of the rules related to PPS payment) (CMS, 

2006). The effect of the policies is that patients who had an MRI (brain) and were subsequently 

admitted to the hospital are not in our sample. Because they comprise a subgroup that is likely 

to be more ill than patients who were not admitted and are thus in our sample, this also might 

result in the observation that office patients have higher rates of the characteristics of interest 

than the OPD patients. Because of these rules regarding outpatient diagnostic services preceding 

hospital admissions, the outpatient claims for patients who are admitted within 3 days are not in 

our sample of MRIs, and we are, therefore, not able to study them directly. 

The rules regarding outpatient diagnostic services prior to admission might also affect the 

characteristics of the office/IDTF patients. If a hospital is not going to be reimbursed for an MRI 

if the patient is admitted, and the patient is likely to be admitted to a hospital, the physician 

24
might order the test to be performed in another setting. If this were true, this subgroup of 

patients (i.e., 

25
Table 3.4 Characteristics of MRI (Brain) Patients By OPD and Office/IDTF Combined, Medicare Fee-for-Service, 2001 

OPD Office/IDTF 

 Number Rate* Number Rate* 

Fisher’s exact

p-value 

All MRI (brain) 21233 -- 19264 -- 

Age > 70 years 14279 672.5 13474 699.4 0.000§,a

Age > 85 years 1745 82.2 1526 79.2 0.273 

Unstable angina in last 3 months 142 6.7 149 7.7 0.217 

Myocardial infarction within past 7 days 0 0.0 2 0.1 0.226 

Recent myocardial infarction (> 7 days but 

fewer than 30 days) 0 0.0 1 0.1 0.476 

Orthopnea 27 1.3 38 2.0 0.083 

Dementia 1917 90.3 2064 107.1 0.000§

Anxiety 201 9.5 214 11.1 0.103 

History of claustrophobia 9 0.4 11 0.6 0.513 

Essential, benign, or drug-related 

tremor/abnormal head movements, 

fasciculations, spasms, or tremor not 

otherwise specified 449 21.1 807 41.9 0.000§

Cerebral edema 69 3.2 21 1.1 0.000§

§

 Comparisons in bold are significant at p<0.05. 

*Per 1,000 procedures. 

a

 Not significant for MRI (brain) without contrast (see Table E.4 in Appendix E). 

Source: RAND analysis of the 5 percent Standard Analytical Files of Medicare claims, 2001. 

those who had an MRI performed in an office or an IDTF and were then admitted to a hospital as 

an inpatient) would be expected to be more ill than other office/IDTF patients. 

To test this, we compared the characteristics of two subgroups of patients who had MRIs 

in the office/IDTF: those who were admitted as an inpatient within three days of the MRI, and 

those who were not admitted. First, we found that only a small percentage of patients having 

MRIs in the IDTF or office were subsequently admitted. Of the 19,264 patients who had MRIs 

26
in the IDTF or office, only 1.6 percent (307/19,264) were admitted to a hospital within 3 days. 

Among patients with an office or IDTF MRI who were admitted within 3 days, the rates of the 

characteristics of interest were not consistently higher than those who were not admitted (data 

not shown). We were not able to analyze data on OPD MRI patients who were admitted within 3 

days. However, the lack of differences in the rates among the office/IDTF MRI patients who 

were admitted and not admitted within 3 days provides no support for assuming OPD MRI 

patients who were admitted within 3 days exhibited higher rates of the characteristics of interest 

than those who were not admitted. In conclusion, the effect of the outpatient rule regarding 

procedures performed in the OPD prior to admission to the same hospital does not seem to 

explain the higher rates in the office/IDTF. 

A second possible explanation for this finding is that MRIs (brain) are performed in 

different settings in different regions of the United States. In the Phase 1 study, we observed, for 

example, that a much lower percentage of outpatient MRIs in the Middle Atlantic region24 are 

performed in an OPD than in the rest of the geographic regions combined (31 percent vs. 57 

percent, respectively) (Wynn et al., 2004). 

To test the hypothesis related to regional differences, we compared the rate of the three 

characteristics of interest (dementia, tremor, and cerebral edema) between those who had an 

MRI in an OPD and those who had an MRI in an office or IDTF by region. For dementia, the 

rates were higher among the office/IDTF patients than the OPD patients in all nine regions of the 

United States (significantly higher for four regions). For tremor, the pattern was similar with 

higher rates in the office/IDTF in all nine regions (significantly higher for eight regions). For 

cerebral edema, the rates in the OPD were higher than in the office/IDTF in six of nine regions 

(one significant). In conclusion, because the office/IDTF rates are consistently higher (or lower) 

than the OPD rates across the regions, the overall differences in rates are not likely explained by 

differences in specific regions. 

A third possible explanation for this finding is that the group of patients having MRIs in 

the OPD might be largely comprised of those with injuries (e.g., falls) who come in through the 

emergency department (ED) and, therefore, might actually be “healthier” (i.e., have fewer 

chronic conditions) than those having an MRI in another setting. To test this, we compared two 

27
groups of OPD patients with an MRI: those with ED charges within two days of the OPD visit 

and those without such ED charges. Of the 21,233 patients who had MRIs in the OPD, 1.6 

percent (340/21,233) had ED charges (data not shown). If the proposed hypothesis were true, 

the OPD patients with ER charges would be expected to have lower rates. Instead, we found 

higher rates of six patient characteristics among the OPD/ED patients, of which one was 

significant.25 Based on this, we conclude that the higher rates observed in the office/IDTF 

patients are not explained by healthier patients coming into the OPD through the ED. 

In conclusion, we tested three hypotheses that might explain the higher rates of dementia 

and tremor in the office/IDTF. However, none of the three appear to explain the finding that 

office/IDTF patients having MRI had significantly higher rates of dementia and tremor. 

Comparison of Outcome Measures Across Settings 

We recommended seven outcomes to MedPAC for further analysis using risk adjustment 

methods, four for cataract surgery, two for colonoscopy, and one for MRI. As explained above 

in Section 2, the outcome measures for the three procedures were selected on the basis of their 

preventability and severity ratings, frequency of occurrence after the procedure, and assurance 

from our clinical experts that they are not conditions that could be indications for having the 

procedure. Below we describe the rationale for selecting each of these outcomes based on the 

selection criteria. A detailed description of the entire process of selecting these from the 

complete list of outcomes for each procedure is described in Appendix F, including information 

on all four selection criteria for all of the outcomes that were considered. 

For each of the six outcome measures, we generated risk-adjusted rates using a multiple 

logistic regression model to adjust for patient characteristics that might affect the risk of the 

outcome occurring after the procedure. By controlling for these characteristics, differences in 

the outcome rates can be attributed to differences between the settings rather than to differences 

in other patient characteristics that might affect the rates. The results presented in Tables 3.5, 

3.10, 3.12, and 3.13 are risk-adjusted rates generated from the multiple logistic regression 

models described in the Methods section. Below we discuss the covariates included in these 

________________________________________________________________________ 24 The Middle Atlantic region includes New Jersey, New York, and Pennsylvania. 

28
models and the results of analysis with regard to differences in the risk-adjusted outcome rates 

among the various ambulatory settings. 

Cataract Surgery 

In selecting the outcome measures for cataract surgery, we considered a list of 30 

measures, including the initial set of 27 that were rated and discussed as part of the Phase 1 panel 

process, plus three outcomes that were added during or after the Phase 1 panel meeting. We 

recommended to MedPAC that four of these measures be analyzed further using risk adjustment. 

They are endophthalmitis, cataract fragments in eye, persistent corneal edema, and iris prolapse. 

Of the cataract surgery outcomes not considered for further analysis, three were dropped 

because they can be indications for having cataract surgery; these are persistent cystoid macular 

edema, retinal break, and retinal detachment. Four additional outcome measures (capsule 

rupture or posterior capsule tear, new or worsening heart failure, wound dehiscence, and wound 

leak) were eliminated because there are no ICD-9 codes that can be used to identify the 

conditions in claims data. 

Endophthalmitis is an inflammation (often from infection) of the vitreous or aqueous 

humor of the eye that might occur following cataract surgery. Endophthalmitis was considered 

to be severe (6 of 6 panelists rating it 8 or 9) and preventable (5 of 5 panelists rating it 5 or 7) by 

the Phase 1 cataract surgery panel26 (Wynn et al., 2004). We recommended it for further analysis 

because it is a severe condition that can be prevented. 

Cataract fragments in eye describes a medical condition in which a part of the cataract 

falls into a particular part of the eye. Although the Phase 1 panel did not rate this outcome, the 

clinical consultant for cataract surgery for the current study informally rated it a 4 on the severity 

scale and a 7 on the preventability scale. We recommended it for further analysis because the 

Phase 1 panel thought it was important enough to add it to the list of outcomes. 

Persistent corneal edema is the prolonged swelling of the corneal tissues beyond the 

normal healing period for cataract surgery. Persistent corneal edema was considered to be 

________________________________________________________________________ 

25 The rates of six characteristics (age over 85 years, unstable angina, orthopnea, dementia, anxiety, and tremor) were higher among the 

OPD patients with ED charges than among the OPD patients without such charges. Of these, the rate of dementia was significantly higher. 

26 In Phase 1, the cataract surgery panel consisted of 7 members, but only 5 and 6 members rated severity and preventability, respectively, 

of endophthalmitis. 

29
moderately severe (all 6 panelists rating it 5 or 7) and preventable (5 of 6 panelists rating it 7 or 

8) by the Phase 1 cataract surgery panel (Wynn et al., 2004). We recommended it for further 

analysis because it is a severe condition that can be prevented. 

Iris prolapse is a condition in which a portion of the pigmented part of the eye sags into 

the eye. It is considered to be a complication of cataract surgery. Iris prolapse was considered to 

be somewhat severe (4 of 6 panelists rating it 5 or 7) and preventable (5 of 6 panelists rating it 8) 

by the Phase 1 cataract surgery panel (Wynn et al., 2004). We recommended it for further 

analysis because it is a somewhat severe condition that can be prevented. 

Results of Outcome Analyses. Accounting for differences in patient characteristics, the 

risk-adjusted rate of endophthalmitis within 30 days of cataract surgery was significantly higher 

among OPD patients than among ASC patients (Table 3.5). This result is based on 61 cases of 

endophthalmitis occurring among 36,622 cataract surgeries in the OPD and 42 cases among 

40,665 ASC surgeries.27 The risk-adjusted rates of the other three outcomes did not differ 

between patients having cataract surgery in the two settings. Cataract fragments were diagnosed 

within 30 days at a predicted rate of 0.94 and 0.90 cases per 1,000 in the OPD and ASC, 

respectively.28 Corneal edema was coded on claims within 30 days of surgery at a slightly, but 

not significantly, higher risk-adjusted rate in the OPD than the ASC (0.76 vs. 0.62 per 1,000).29 

Iris prolapse was coded very infrequently on claims in the 30 days after surgery, with only 3 

and1 cases among OPD and ASC patients, respectively.30 Appendix G shows the percentage of 

the cataract surgery sample for each dummy variable in the four cataract surgery models. 

_________________ 27 There are 103 cases of endophthalmitis the current study compared to 113 cases in the Phase 1 study. The difference is explained by two 

factors. First, we excluded one case that occurred in a patient with cataract surgery performed in the office setting. Second, 9 patients had two 

cataract surgeries performed and a single diagnosis of endophthalmitis that fell within 30 days of both procedures. In the current study, we 

counted this as only one outcome for each beneficiary while in Phase 1 it was counted as two outcomes. 

28 There are 71 cases of cataract fragments in the current study compared to 92 cases in the Phase 1 study. The difference is explained by 

two factors. First, we excluded two cases that occurred in patients with cataract surgery performed in the office setting. Second, 19 patients had 

two cataract surgeries performed within a short period of time and a single diagnosis of cataract fragments that fell within 30 days of both 

procedures. In the current study, we counted this as only one outcome for each beneficiary while in Phase 1 it was counted as two outcomes. 

29 There are 63 cases of persistent corneal edema in the current study compared to 54 cases in the Phase 1 study. The difference is 

explained by two factors. First, we excluded one case that occurred in a patient with cataract surgery performed in the office setting. Second, we 

included ten more cases identified as having keratoplasty on an inpatient or outpatient basis. 

30There are 4 cases of iris prolapse in this model compared to 62 cases in the Phase 1 study. The difference is explained by two factors. 

First, the ICD-9-CM codes that were used to identify cases were changed between the two studies. In the current study, we use 364.75 to identify 

cases while 364.7x was used in the Phase 1 study. Second, two patients had two cataract surgeries performed and a single diagnosis of iris 

prolapse that fell within 30 days of both procedures. In the current study, we counted this as only one outcome for each beneficiary while in 

Phase 1 it was counted as two outcomes. 

30
Table 3.5 Risk-Adjusted Rates* of Selected Outcomes Occurring Within 30 Days Following Cataract 

Surgery By Setting, Medicare Fee-for-Service, 2001 

OPD ASC 

Number Rate** Number Rate** 

Chi-Square 

p-value 

All cataract surgeries 36,623 -- 40,671 -- 

Endophthalmitis 61 1.64 42 1.05 0.026§

Cataract fragments in eye 35 0.94 36 0.90 0.827 

Persistent corneal edema 28 0.76 25 0.62 0.435 

Iris prolapse 3 0.07 1 0.03 0.415 

§

 Comparisons in bold are significant at p<0.05. 

*Each risk-adjusted rate is calculated based on the logistic regression model (see Methods section for details). 

**Per 1,000 procedures. 

Source: RAND analysis of the 5 percent Standard Analytical Files of Medicare claims, 2001. 

Note: Cataract surgeries performed in the office setting were excluded because of small numbers. 

As described above in the Methods section, multiple logistic regression models were 

used to estimate the risk-adjusted rates for the four cataract surgery outcomes that are shown in 

Table 3.5. The model parameters (regression coefficients, standard errors, and p-values) for 

each of these models are shown in Tables 3.6-3.9. The model coefficients for endophthalmitis 

(Table 3.6) indicate that being older and having the procedure performed in an OPD significantly 

increased the probability of having a diagnosis of endophthalmitis within 30 days of cataract 

surgery. Older beneficiaries were increasingly more likely to have endophthalmitis as indicated 

by significant positive coefficients that increase in magnitude with increasing age. The 

remaining model coefficients were not statistically significant. 

Based on the coefficients for the cataract fragments model (Table 3.7), increasing age 

also significantly increased the probability of having a diagnosis of cataract fragments within 30 

days of cataract surgery. The coefficients for the rest of the model variables, including the 

dummy variable for the ASC setting, were not statistically significant. 

31
Table 3.6 Parameter Estimates from Logistic Regression for Endophthalmitis 

within 30 Days of Cataract Surgery, Medicare Fee-for-Service, 2001 

Variable* Parameter 

Estimate Standard Error p Value 

Intercept -6.781 0.267 <.0001§

age_under_65 -0.105 0.815 0.8971 

age_75_84 0.551 0.244 0.0237§

age_85p 1.156 0.296 <.0001§

female -0.313 0.202 0.1217 

race_afam 0.677 0.347 0.0509 

race_other 0.690 0.439 0.1164 

disabled 0.000 0.421 0.9997 

medicaid -0.290 0.346 0.4019 

diabetes 0.048 0.223 0.8298 

arth_lupus 0.393 0.370 0.2881 

cancer_leuk 0.521 0.587 0.3748 

inasc -0.449 0.201 0.0257§

§

 Parameters in bold are significant at p<0.05. 

*Two variables representing AIDS and tremor were dropped from the model 

based on initial results indicating the coefficients were insignificant and unstable 

because of small numbers. 

In the models for persistent corneal edema and iris prolapse (Tables 3.8 and 3.9, 

respectively), none of the variables were statistically significant, including the dummy variable 

for the ASC setting. This means that the variables represented in the two models did not 

significantly increase or decrease the probability of either persistent corneal edema or iris 

prolapse within the 30 days after cataract surgery. 

32
Table 3.7 Parameter Estimates from Logistic Regression for Cataract 

Fragments within 30 Days of Cataract Surgery, Medicare Fee-for-Service, 2001 

Variable* Parameter 

Estimate Standard Error p Value 

Intercept -7.542 0.334 <.0001§

age_under_65 0.305 0.709 0.6673 

age_75_84 0.682 0.301 0.0235§

age_85p 1.212 0.371 0.0011§

female -0.060 0.247 0.8096 

race_afam -0.772 0.728 0.2891 

race_other 0.471 0.537 0.3798 

disabled 0.688 0.406 0.0900 

medicaid -0.025 0.388 0.9478 

history_vitrectomy -10.773 428.700 0.9800 

tremor 1.033 1.010 0.3064 

inasc -0.052 0.238 0.8272 

§

 Parameters in bold are significant at p<0.05. 

*Two variables representing pseudoexfoliation and pupillary abnormalities were 

dropped based on initial results indicating the coefficients were insignificant and 

unstable because of small numbers. 

Table 3.8 Parameter Estimates from Logistic Regression for Persistent 

Corneal Edema within 30 Days of Cataract Surgery, Medicare Fee-forService, 2001 

Variable* Parameter 

Estimate Standard Error p Value 

Intercept -7.441 0.369 <.0001§

age_under_65 0.226 0.890 0.7998 

age_75_84 -0.202 0.294 0.4912 

age_85p -0.513 0.544 0.3459 

female 0.581 0.322 0.0709 

race_afam 0.332 0.540 0.5384 

race_other 0.575 0.621 0.3543 

disabled -0.079 0.584 0.8926 

medicaid -0.306 0.473 0.5176 

diabetes -0.052 0.317 0.8692 

inasc -0.215 0.276 0.4353 

*A variable representing tremor was dropped from the model based on initial 

results indicating the coefficient was insignificant and unstable because of small 

numbers. 

§

 Parameters in bold are significant at p<0.05. 

33
Table 3.9 Parameter Estimates from Logistic Regression for Iris Prolapse 

within 30 Days of Cataract Surgery, Medicare Fee-for-Service, 2001 

Variable* Parameter 

Estimate Standard Error p Value 

Intercept -21.196 143.900 0.8829 

age_under_65 0.783 1.538 0.6108 

age_75_84 0.083 1.441 0.9542 

age_85p 1.582 1.481 0.2852 

female 10.674 143.900 0.9409 

race_afam 1.979 1.091 0.0697 

race_other -10.050 463.800 0.9827 

disabled 1.830 1.323 0.1667 

medicaid 0.606 1.141 0.5958 

inasc -0.945 1.159 0.4147 

*Four variables representing pseudoexfoliation, history of vitrectomy, pupillary 

abnormalities, and tremor were dropped from the model based on initial results 

indicating the coefficients were insignificant and unstable because of small 

numbers. 

Colonoscopy 

In selecting the recommended outcome measures for colonoscopy, we considered a list of 

20 outcome measures, including the initial set of 19 that were rated and discussed as part of the 

Phase 1 panel process, plus one outcome that was added after the Phase 1 panel meeting. We 

recommended to MedPAC that two of these measures, perforation and splenic rupture, be 

analyzed further using risk adjustment. However, there were no cases of splenic rupture, within 

the 30-day window of the colonoscopies in our sample.31 Therefore, splenic rupture could not 

be used as an outcome for colonoscopy. Perforation became the only outcome to be studied for 

colonoscopy. 

Of the colonoscopy outcomes not considered for further analysis, five were dropped 

because they can be indications for having a colonoscopy; these are abdominal pain, 

hemorrhage, abdominal distension, sepsis and other infections, and hypotension. One outcome 

measure (post34
polypectomy syndrome) was eliminated because there are no ICD-9 codes that can be used to 

identify the condition in claims data. 

Perforation (i.e., colonic perforation) is a tear of the large intestine, which occurs very 

infrequently during colonoscopy. Perforation may lead to bleeding and leakage of the contents 

of the large intestine into the abdominal cavity. This is problematic because the large intestine 

contains bacteria that should not be in the abdominal cavity, and might result in a severe 

infection. Perforation was considered to be severe (8 of 9 panelists rating it 6, 8 or 9) and 

moderately preventable (6 of 9 panelists rating it 5 or 8) by the Phase 1 colonoscopy panel 

(Wynn et al., 2004). Perforation was selected because it is a severe condition that can usually be 

avoided. 

Results of Outcome Analyses. Based on all colonoscopies, perforation occurred within 30 

days of the procedure at a significantly higher predicted rate (i.e., adjusted for differences in 

patient characteristics) among ASC patients than among OPD patients (1.67 vs. 0.76 per 1,000, 

respectively) (Table 3.10). We repeated the logistic regression runs on the subset of 

colonoscopies with lesion removal, biopsy, or control of bleeding (RBC) and those without 

RBC. Among both RBC and non-RBC colonoscopies, the predicted perforation rates were also 

significantly higher in the ASC than in the OPD (Table 3.10). The predicted rate of perforation 

among office colonoscopies did not differ significantly from OPD and ASC for any of the three 

Table 3.10 Risk-Adjusted Rates* of Perforation Occurring Within 30 Days Following Colonoscopy By 

Setting, Medicare Fee-for-Service, 2001 

OPD ASC Office Chi-Square p-value 

Colonoscopy 

Sample Number Rate** Number Rate** Number Rate** OPD vs. 

ASC 

OPD vs. 

Office 

ASC vs.

Office 

All colonoscopies 63372 -- 23503 -- 4015 -- 

All 49 0.76 37 1.67 3 0.75 0.000§ 0.982 0.180 

RBC 28 0.80 20 1.63 0 0.00 0.016§ 0.975 0.960 

Non-RBC 21 0.71 17 1.73 3 1.37 0.007§ 0.285 0.715 

§

 Comparisons in bold are significant at p<0.05. 

________________________________________________________________________ 31 Between Phase 1 and Phase 2, we changed the ICD-9-CM diagnosis codes used to identify splenic rupture cases. In Phase 1, ICD-9-CM 

codes 789.2 and 865.1 were used and, in Phase 2, ICD-9-CM codes 865.0 and 865.1 were used. 

35
*Each risk-adjusted rate is calculated based on the logistic regression model (see Methods section for details). 

**Per 1,000 procedures. 

Source: RAND analysis of the 5 percent Standard Analytical Files of Medicare claims, 2001. 

samples of colonoscopies (all, RBC, and non-RBC). These predicted rates are based on a total of 

89 cases (49, 37, and 3 cases of perforation in the OPD, ASC, and office, respectively).32 

Appendix H shows the percentage of the colonoscopy sample in each category of the dummy 

variables in the models and the parameters from each perforation logistic regression (regression 

coefficients, standard errors, and p-values). The model parameters (regression coefficients, 

standard errors, and p-values) for the perforation model are shown in Table 3.11. In the 

perforation model, having the procedure performed in the ASC increased the probability of 

having a diagnosis of perforation within 30 days of having a colonoscopy (as discussed above). 

None of the remaining variables, including the dummy variable for the office setting, were 

statistically significant. This indicates that the rest of the variables did not significantly increase 

or decrease the probability of a perforation diagnosis within the 30 days following a 

colonoscopy. 

Table 3.11 Parameters from Logistic Regression for Perforation within 30 

Days of All Colonoscopies, Medicare Fee-for-Service, 2001 

Variable Parameter 

Estimate 

Standard 

Error p Value 

Intercept -7.512 0.235 <.0001§

age_under_65 -0.878 0.577 0.1281 

age_75_84 0.189 0.231 0.4132 

age_85p 0.402 0.412 0.3289 

female 0.009 0.218 0.9681 

race_afam -0.019 0.409 0.9636 

race_other -0.690 0.732 0.3459 

disabled 0.269 0.383 0.4818 

medicaid 0.825 0.313 0.0085§

bowel_obstruct 1.158 0.345 0.0008§

colorectal_cancer 0.782 0.472 0.0972 

inflam_bowel_disease 0.638 0.591 0.2804 

_________________ 32 There are 89 cases of perforation in the current study compared to 73 cases in the Phase 1 study. The difference is explained by the fact 

that we included more cases identified with additional ICD-9-CM codes for perforation. In Phase 1, we included only 998.2, and in the current 

study, we include 998.2, E870.4, and 569.83. 

36
melena 0.742 0.516 0.1500 

inasc 0.796 0.220 0.0003§

inoff -0.014 0.597 0.9817 

§

 Parameters in bold are significant at p<0.05. 

37
MRI (Brain) 

In selecting the recommended outcome measures for MRI (brain), we considered a list of 

19 outcome measures, including the initial set of 18 that were rated and discussed as part of the 

Phase 1 panel process, plus one outcome that was added after the Phase 1 panel meeting. We 

recommended to MedPAC that only one of these measures, anaphylaxis/anaphylactoid reaction, 

be analyzed further using risk adjustment. 

Of the MRI outcomes not considered for further analysis, eight outcomes were dropped 

because they can be indications for having an MRI (brain); these are altered mental status, 

dizziness, headache, ocular injury, paresthesia, seizure, syncope, and vasospasm. One additional 

outcome measure, vasodilatation, was eliminated because there are no ICD-9 codes that can be 

used to identify the condition in claims data. 

Anaphylaxis/anaphylactoid reaction is an immediate and potentially life-threatening 

allergic reaction involving the entire body due to a massive release of mediators from special 

cells. It can result in difficulty breathing and, in rare cases, death. It would occur as a result of 

an allergic reaction of the patient to the contrast media used in some MRIs. This outcome was 

considered to be very severe (all 7 panelists rating it 7, 8, or 9) by the Phase 1 MRI panel (Wynn 

et al., 2004). However, anaphylaxis was not considered to be preventable by most of the Phase 1 

MRI panel, with only 2 of 7 panelists rating it 4 or higher. It is included despite the fact that it 

occurs very infrequently and might not be predictable, because there are no other reasonable 

outcome measures for MRI (brain). 

Results of Outcome Analyses. Anaphylaxis was an extremely infrequent event among 

patients who had MRI (brain) with or without a contrast agent. Only three cases of anaphylaxis 

were identified from claims in the first 7 days after an MRI (brain), only one of which occurred 

in a patient having MRI (brain) with a contrast agent (top of Table 3.12). Finding anaphylaxis 

cases among those having an MRI (brain) without contrast was unexpected, because the 

assumption was that exposure to the contrast agent would trigger the anaphylactic reaction. 

However, this finding might have occurred due to a coding error in which the MRI was coded as 

“without contrast” when it was actually conducted “with contrast.” Another possible 

explanation 

38
Table 3.12 Risk-Adjusted Rates* of Anaphylaxis/Anaphylactoid Reaction Occurring Within 7 and 30 Days 

Following MRI (Brain) in OPD, Office, and IDTF, Medicare Fee-for-Service, 2001 

OPD Office IDTF Chi-Square p-value 

MRI (Brain) Sample Number Rate** Number Rate** Number Rate** OPD vs. 

Office 

OPD vs. 

IDTF 

Office vs. 

IDTF 

All MRI (brain) 21233 -- 14712 -- 4552 --

Within 7 days 

All 1 0.04 1 0.08 1 0.17 0.653 0.336 0.608 

With contrast 1 0.08 0 0.00 0 0.00 0.953 0.971 0.998 

Without contrast 0 0.00 1 0.19 1 0.36 0.932 0.928 0.662 

Within 30 days 

All 6 0.28 3 0.21 2 0.44 0.660 0.582 0.407 

With contrast 5 0.37 1 0.13 1 0.42 0.356 0.906 0.420 

Without contrast 1 0.13 2 0.28 1 0.46 0.536 0.365 0.689 

*Each risk-adjusted rate is calculated based on the logistic regression model (see Methods section for details). 

**Per 1,000 procedures. 

Source: RAND analysis of the 5 percent Standard Analytical Files of Medicare claims, 2001. 

is that the anaphylaxis could result from other conditions or situations that might not be coded 

(i.e., undercoded) in claims (e.g., ingestion of peanuts or a bee sting in an allergic patient). 

Although we ran a logistic regression model for the three cases that occurred with 7 days 

of an MRI, there is little that can be concluded from such a small sample, other than the 

predicted rates of anaphylaxis are zero or very small and there are no significant differences 

among the settings. We tested the sensitivity of the finding to the length of the followup period, 

by extending it to 30 days (bottom of Table 3.12). We found 11 cases of anaphylaxis occurred 

within the 30-day period, with 7 among those with contrast MRIs (brain) and 4 among those 

with non-contrast MRIs (brain).33 None of the differences in predicted rates (i.e., adjusted for 

patient characteristics) among settings were significant based on the 30-day model. 

Because services provided in offices and IDTFs are paid under the same payment system 

(physician fee schedule), we also constructed models to test for differences between OPD 

patients and a combined group of IDTF and office patients. Based on predicted rates from these 

models, we conclude that the 7-day and 30-day rates are not significantly different between the 

_________________ 33 The 11 cases identified within 30 days of an MRI in the current study are the same as those in the Phase 1 study. 

39
Table 3.13 Risk-Adjusted Rates* of Anaphylaxis/Anaphylactoid Reaction Occurring Within 7 and 30 Days 

Following MRI (Brain) in OPD and IDTF and Office Combined, Medicare Fee-for-Service, 2001 

OPD IDTF and Office 

Number Rate** Number Rate** 

Chi-Square 

p-value

All MRI (brain) 21233 -- 19264 -- 

Within 7 days 

All 1 0.04 2 0.11 0.446 

With contrast 1 0.08 0 0.00 0.941 

Without contrast 0 0.00 2 0.25 0.904 

Within 30 days 

All 6 0.28 5 0.26 0.913 

With contrast 5 0.37 2 0.20 0.477 

Without contrast 1 0.13 3 0.32 0.423 

*Each risk-adjusted rate is calculated based on the logistic regression model (see Methods section for details). 

**Per 1,000 procedures. 

Source: RAND analysis of the 5 percent Standard Analytical Files of Medicare claims, 2001. 

OPD and the other two settings in the entire MRI (brain) sample and in the subgroups of 

procedures with and without contrast (Table 3.13). 

The model parameters (regression coefficients, standard errors, and p-values) for the 

anaphylaxis model based on all MRIs (brain) are shown in Table 3.14. In the anaphylaxis 

model, none of the variables were statistically significant, including the dummy variable for the 

IDTF 

Table 3.14 Parameters from Logistic Regression for Anaphylaxis within 7 Days of 

All MRIs (Brain) for Three Settings, Medicare Fee-for-Service, 2001 

Variable* Parameter 

Estimate Standard Error p Value 

Intercept -20.062 144.900 0.8899 

age_under_65 -1.713 1.415 0.2261 

age_75_84 -10.711 189.800 0.9550 

age_85p -10.798 406.200 0.9788 

female -0.223 1.233 0.8566 

race_afam -10.852 318.000 0.9728 

disabled 0.894 1.412 0.5267 

medicaid 12.807 144.900 0.9296 

history_anaph_shock -9.767 1001.300 0.9922 

inidtf 1.363 1.417 0.3363 

inoff 0.636 1.416 0.6532 

*Two variables representing “other race” and personal allergy to radiographic dye were 

dropped from the model based on initial results indicating the coefficients were 

40
insignificant and unstable because of small numbers. 

41
and office settings. This indicates that the variables represented in the two models did not 

significantly increase or decrease the probability of an anaphylaxis diagnosis within the 30 days 

after having a MRI (brain). Appendix I shows the percentage of the MRI (brain) sample in each 

category of the variables in the models, and the parameters from anaphylaxis logistic regression 

models (regression coefficients, standard errors, and p-values) for MRIs (brain) with and without 

contrast for the three-setting comparison, and for all MRIs, as well as with and without contrast 

for the two-setting comparison. 

42
4. Summary and Discussion 

The research described in this report focuses on three procedures performed frequently in 

multiple ambulatory settings on Medicare patients. The study procedures (cataract surgery, 

colonoscopy, and MRI (brain)) were selected in Phase 1 of this study based on having high 

volume in two or three settings in addition to potential safety concerns. The current study was 

designed to answer two questions. First, are there significant differences between ambulatory 

settings in the characteristics of the Medicare patients having these three high-volume 

procedures that might be expected to increase the facility cost? Second, are there significant 

differences between the settings in risk-adjusted rates of adverse outcomes following the three 

procedures? We addressed these questions by analyzing selected characteristics and outcomes 

using enrollment and claims data for a 5 percent sample of Medicare beneficiaries for calendar 

year 2001. 

Summary of Findings 

Cataract Surgery. All cataract surgery patients exhibited low rates of most 

characteristics that might increase facility costs. However, significantly more OPD patients had 

several of the characteristics than those in the ASC (age over 85 years, dementia, acute episode 

of COPD, prescription drug dependence, alcohol abuse, schizophrenia, tremor, pseudoexfoliation 

of lens capsule, progressive high myopia, dislocation of lens, and posterior synechiae). In 

addition, we observed that after risk adjustment, all four outcomes (endophthalmitis, cataract 

fragments, corneal edema, and iris prolapse) occurred more frequently in the OPD. However, 

for only one of the outcomes, endophthalmitis, was the rate significantly higher. 

Colonoscopy. All colonoscopy patients displayed low rates of most characteristics 

possibly related to increased facility costs, but OPD patients had somewhat higher rates than 

ASC patients (age over 85 years, recent unstable angina, dementia, acute episode of COPD, 

acute episode of cardiomyopathy/heart failure/pulmonary edema, malignant hypertension, 

prescription drug dependence, past bowel obstruction, past colorectal cancer, and melena). 

43
There was not a consistent pattern of these characteristics for OPD or ASC patients compared to 

office patients; rates were sometimes higher in the office setting and sometimes in the other two 

settings. Using logistic regression, we investigated one outcome following colonoscopy, 

perforation. The risk-adjusted rates of perforation were low in all three settings, but significantly 

higher in the ASC than in the OPD, and not higher than in the office setting. The same pattern 

also held for rates of perforation following RBC and non-RBC colonoscopies. 

MRI (Brain). Rates were low among patients having an MRI (brain) for most 

characteristics that might increase facility costs. Of those with such characteristics, office 

patients showed significantly higher rates than patients in the OPD and IDTF (age over 70 years, 

recent unstable angina, orthopnea, dementia, and tremor). OPD and IDTF patients had similar 

rates for most characteristics. Anaphylaxis was the only outcome selected for further analysis 

using risk adjustment. The risk-adjusted rates for anaphylaxis within 7 days of the procedure 

were extremely low and not significantly different across settings. These results did not change 

when the followup period was extended to 30 days. 

Discussion 

The report from the Phase 1 study concluded that the “preliminary analyses for the three 

procedures suggest that with further refinement the administrative data can be used to reach a 

number of policy-relevant conclusions” (Wynn et al., 2004). Our study incorporates some of the 

refinements discussed in the Phase 1 study as necessary before any conclusions are made 

concerning differences across ambulatory settings. First, we incorporated clinical expertise into 

the selection of a set of patient characteristics that might increase facility costs, and then 

employed statistical tests to assess the likelihood of the differences between settings being due to 

chance. It is important to note that the patient characteristics analyzed in this study were not 

formally evaluated by a large panel of clinical experts, nor did RAND quantify the relationship 

between each characteristic and actual cost. Second, we carefully selected a set of outcomes that 

met specific criteria and then utilized multiple logistic regression to risk-adjust for covariates and 

to test for differences between settings. These methods allow us to evaluate the results in a more 

scientifically rigorous manner and, therefore, to strengthen the conclusions. 

44
In interpreting these findings, it is important to keep in mind that most of the observed 

rates for the patient characteristics are very low, and therefore, the differences between the rates 

in the different settings are very small (see Tables 3.1—3.4). For cataract surgery, the most 

frequent patient characteristic was being over 85 years of age, with the rate in the OPD 

significantly higher than the ASC rate (Table 3.1). All of the other characteristics for cataract 

surgery occur much less frequently, with some OPD rates significantly higher than ASC. For 

colonoscopy, the rates of the patient characteristics are also low, with some OPD rates 

significantly higher than ASC and some office rates significantly higher than OPD (Table 3.2). 

For MRI, most of the patient characteristic rates are low with three significantly higher in the 

IDTF/office than OPD and only one significantly higher in the OPD than IDTF/office (Tables 

3.3 and 3.4). 

Similarly, the adverse outcomes occur very infrequently in all settings. We found 

significant differences between settings for two outcomes, endophthalmitis following cataract 

surgery and perforation following colonoscopy. Endophthalmitis occurred at a rate of 1.64 and 

1.05 per 1000 procedures in the OPD and the ASC settings, respectively, with a difference of 

0.59 per 1000 (see Table 3.5). Perforation occurred even less frequently with rates of 0.76, 1.67, 

and 0.75 per 1000 procedures in the OPD, ASC, and office settings, respectively, with 

differences between the settings of less than 1 per 1000 (see Table 3.10). Although the 

differences are significant, the magnitude of these rates should be considered when the policy 

significance of the differences between the various settings is contemplated. 

Selection of Measures 

We attempted to identify 4 – 7 adverse outcome measures for each procedure as 

MedPAC had requested. However, given that the study procedures are relatively safe with a low 

rate of complications, identifying this number of meaningful outcome measures was not 

possible. A large number of conditions that might occur as a result of the three procedures were 

eliminated because they were also considered to be indications for having the procedure. In 

addition, several outcomes were excluded from consideration because there was not an ICD-9-

CM code suitable for identifying them in claims data. 

45
Of the remaining conditions, we tried to identify outcomes that are severe, preventable, 

and frequent, and can reasonably be assumed to have occurred as a result of the procedure. We 

focused primarily on outcomes related to the organ affected by the procedure, because it would 

be more difficult to establish that the general medical outcomes occurred as a result of the 

procedures, especially using claims data as supporting evidence. This issue arises because it is 

impossible to tell from claims data when a condition was diagnosed. Conducting a similar study 

using medical records might allow the use of some of the conditions that were excluded as 

outcomes because it might be possible to determine the sequence of events more accurately. 

Limitations of Administrative Data 

Using claims data to examine potential differences in quality and processes of care across 

ambulatory settings has several advantages (Wynn et al., 2004). Medicare claims data are 

routinely collected and relatively inexpensive to analyze. They are available relatively quickly – 

there is a lag of seven months between the end of a calendar year and the release of Standard 

Analytical Files (SAF) of Medicare claims from CMS.34 Thus, measures based on claims data 

can be calculated in a somewhat timely fashion. The availability of claims data on an ongoing 

basis allows periodic evaluation crucial to identifying emerging trends and evaluating the impact 

of policy. However, outcomes can be difficult to measure using administrative data because 

clinical detail is lacking and data elements not directly related to payment might be unreliable. 

There are concerns about using claims data for condition-specific analyses because 

identifying clinical subgroups of patients with ICD-9-CM codes might be problematic (Wynn et 

al., 2004). These concerns fall into two categories: 1) the ICD-9-CM diagnostic nomenclature, 

and 2) the use of ICD-9-CM diagnostic codes (Iezzoni, 1990). The ICD-9-CM nomenclature 

contains many ambiguities. Codes may be vague (e.g., heart failure, unspecified) and contain 

codes for symptoms (e.g., fatigue) as well as codes for diseases (e.g., lung cancer). In addition, 

the nomenclature provides only limited indicators of the severity of a condition. This makes 

identifying specific clinical outcomes following a procedure difficult. 

The way in which diagnoses are coded in individual settings and overall might create 

artifactual differences (Wynn et al., 2004). For example, in searching for a patient characteristic 

46
________________________________________________________________________ 

or an outcome, finding it on an inpatient claim might be more likely because multiple diagnoses 

are coded for each admission. In contrast, most outpatient claims contain at most a few 

diagnostic codes. In addition, certain ICD-9-CM codes are also more likely to be coded on 

inpatient claims because hospital payment based on DRGs has introduced a pecuniary bias into 

coding practices known as "DRG creep” (Simborg, 1981). In studies to validate ICD-9-CM 

codes with chart-based reviews, substantial inaccuracies and unexplained geographic variation 

have been uncovered (IOM, 1980). The degree of inaccuracy, however, depends greatly on the 

condition and algorithm used to detect the condition (Quam et al., 1993). 

In the Phase 1 study, we noted that attributing outcomes to particular procedures often 

requires making questionable assumptions (Wynn et al., 2004). In the current study, we have 

addressed this issue in two ways. First, we have limited the analyses to outcomes that are not 

considered to be indications for having the procedure. Therefore, when we find an outcome 

coded on a claim during the period following the procedure, we know that it was not the reason 

for having the procedure. Second, we have limited the outcomes to conditions that are specific 

to the body system involved in the procedure (e.g., perforation of the colon for colonoscopy). 

One of the objectives of the Phase 1 study was to determine whether administrative data 

could be used to study differences among settings in the patient characteristics that might 

increase the facility resources needed to perform the procedure (Wynn et al., 2004). In the 

current study, we have used clinical expert opinion to select a subset of characteristics that might 

affect the medical complexity of a patient. Although we did not analyze data to answer this 

question directly, the clinical experts and the project physician provided us with information 

about the likelihood of the procedure requiring more facility resources. The underlying 

assumption is that performing a diagnostic or surgical procedure on a medically complex patient 

or on a patient with a particular condition such as dementia may require more resources. In 

Phase 1, the MRI panel indicated a patient with claustrophobia might be more time-consuming 

and might require sedatives. Patients with dementia and those with monocular vision were 

identified by the colonoscopy and cataract panels, respectively, as likely to require more time. 

However, because claustrophobia is likely to be “undercoded” on claims, the rates of 

claustrophobia reported in the current study (see Tables 3.3 and 3.4) are probably 

34 We used 2001 data for these analyses because the files were created for the Phase 1 study which started in 2003. 

47
_________________ 

underestimated. Codes are not available for identifying monocular vision in claims, so we were 

not able to calculate a rate for this condition. 

The overall limitations of claims data and of specific variables used in our analysis do not 

mean that claims data should not be used for clinically-based measures, though confirmation 

with more clinically detailed methods such as chart review would be desirable. 

Conclusion 

In this study of three high-volume outpatient procedures, we compared patient 

characteristics and outcomes in multiple settings using Medicare administrative data. We 

conclude the following: 

• Observed rates for most characteristics thought to affect the cost of performing 

the three study procedures are very low in all settings. 

• Looking across all three services and all settings, no single setting had patients 

with consistently higher rates of characteristics that might increase the cost of 

performing the service. The characteristics we examined were not formally 

evaluated by a large panel of clinical experts, nor did RAND quantify the 

relationship between each characteristic and actual cost. 

• Observed rates for adverse outcomes are also very low in all settings, so that the 

magnitudes of significant differences between settings are quite small. 

Although there are some significant differences between the settings, both in terms of the type of 

patients who are treated in the setting and in the outcomes following cataract surgery and 

colonoscopy,35 the lack of consistent patterns across the three study procedures might make it 

difficult to draw general conclusions about differences in care provided in the various 

ambulatory settings. The study, however, still contributes useful information that will inform 

policy decisions related to this topic. 

35 The outcome for MRI, anaphylaxis/anaphylactoid reaction, did not vary significantly by setting. 

48
Appendices 

49 

Appendix A. Background of Clinical Consultants 

The clinical consultant for colonoscopy, Christopher Chang, M.D., Ph.D., is an Assistant 

Professor of Medicine in the Division of Gastroenterology at UCLA Medical Center. He 

completed his fellowship in gastroenterology at UCLA Medical Center. He has clinical 

experience working in the inflammatory bowel disease clinic and also is involved in a variety of 

research activities related to Campylobacter (a pathogen that causes gastrointestinal illnesses). 

The clinical consultant for cataract surgery, Irene C. Kuo, M.D., is Assistant Professor of 

Ophthalmology at the Wilmer Eye Institute, and Medical Director of the Wilmer Eye Institute at 

White Marsh, Maryland. A corneal specialist and board-certified ophthalmologist, Dr. Kuo has 

clinical expertise in laser refractive surgery, corneal disease and surgery, corneal transplant and 

cataract surgery, and uveitis. Dr. Kuo is involved in a variety of research activities, including 

wound healing after keratorefractive procedures and the evaluation and treatment of infectious 

keratitis. She completed her residency at the University of Southern California—Doheny Eye 

Institute, and her fellowship in cornea, refractive surgery, and uveitis at the University of 

California at San Francisco and the Proctor Foundation. 

The clinical consultant for MRI (brain), Kenneth Ong, M.D., is a neuroradiologist in 

private practice in San Jose, CA. He completed his fellowship in neuroradiology at University 

of California, San Francisco. He is in a group practice with 12 other radiologists. The group 

covers two hospitals, runs an outpatient radiology office, and provides readings for a nearby 

imaging center. 

51 

Appendix B. HCPCS/CPT Codes for Study Procedures 

Table B.1 BETOS P4B: Eye procedure—Cataract Removal/Lens Insertion 

CPT Code CPT Description 

66820* Discission of secondary membranous cataract (opacified posterior lens capsule and/or anterior hyaloid); stab 

incision technique (Ziegler or Wheeler knife). 

66830 Removal of secondary membranous cataract (opacified posterior lens capsule and/or anterior hyaloid) with 

corneo-scleral section, with or without iridectomy (iridocapsulotomy, iridocapsulectomy). 

66840 Removal of lens material; aspiration technique, one or more stages. 

66850 Removal of lens material; phacofragmentation technique (mechanical or ultrasonic) (e.g., phacoemulsification), 

with aspiration. 

66852 Removal of lens material; pars plana approach, with or without vitrectomy. 

66920 Removal of lens material; intracapsular. 

66930 Removal of lens material; intracapsular, for dislocated lens. 

66940 Removal of lens material; extracapsular (other than 66840, 66850, 66852). 

66982 Extracapsular cataract removal with insertion of intraocular lens prosthesis (one stage procedure), manual or 

mechanical technique, (eg, irrigation and aspiration or phacoemulsification), complex, requiring devices or 

techniques not generally used in routine cataract surgery (eg, iris expansion device, suture support for 

intraocular lens, or primary posterior capsulorrhexis) or performed on patients in the amblyogenic 

developmental stage 

66983 Intracapsular cataract extraction with insertion of intraocular lens prosthesis (one stage procedure). 

66984 Extracapsular cataract removal with insertion of intraocular lens prosthesis (one stage procedure), manual or 

mechanical technique (eg, irrigation and aspiration or phacoemulsification). 

66985 Insertion of intraocular lens prosthesis (secondary implant), not associated with concurrent cataract removal. 

66986 Exchange of intraocular lens. 

 *Although the CPT code 66820 falls in BETOS category P4E (Eye procedure - other), it was included in the analysis. 

53 
Table B.2 BETOS P8D: Endoscopy—colonoscopy 

CPT Code CPT Description 

44388 Colonoscopy through stoma; diagnostic, with or without collection of specimen(s) by brushing or 

washing (separate procedure). 

44389 Colonoscopy through stoma; with biopsy, single or multiple. 

44390 Colonoscopy for foreign body 

44391 Colonoscopy through stoma; with control of bleeding, any method. 

44392 Colonoscopy through stoma; with removal of tumor(s), polyp(s), or other lesion(s) by hot biopsy 

forceps or bipolar cautery. 

44393 Colonoscopy through stoma; with ablation of tumor(s), polyp(s), or other lesion(s) not amenable to 

removal by hot biopsy forceps, bipolar cautery or snare technique. 

44394 Colonoscopy through stoma; with removal of tumor(s), polyp(s), or other lesion(s) by snare 

technique. 

44397 Colonoscopy w/stent 

45355 Surgical colonoscopy 

45378 Colonoscopy, flexible, proximal to splenic flexure; diagnostic, with or without collection of 

specimen(s) by brushing or washing, with or without colon decompression (separate procedure). 

45379 Colonoscopy, flexible, proximal to splenic flexure; with removal of foreign body. 

45380 Colonoscopy, flexible, proximal to splenic flexure; with biopsy, single or multiple. 

45382 Colonoscopy, flexible, proximal to splenic flexure; with control of bleeding, any method. 

45383 Colonoscopy, flexible, proximal to splenic flexure; with ablation of tumor(s), polyp(s), or other 

lesion(s) not amenable to removal by hot biopsy forceps, bipolar cautery or snare technique. 

45384 Colonoscopy, flexible, proximal to splenic flexure; with removal of tumor(s), polyp(s), or other 

lesion(s) by hot biopsy forceps or bipolar cautery. 

45385 Colonoscopy, flexible, proximal to splenic flexure; with removal of tumor(s), polyp(s), or other 

lesion(s) by snare technique. 

45387 Colonoscopy, flexible, proximal to splenic flexure; with transendoscopic stent placement (includes 

predilation) 

G0105* Colorectal screen; high risk individual 

*Level II HCPCS code. 

54 
Table B.3 BETOS I2C: Advanced imaging—MRI: head, neck, and brain 

CPT Code CPT Description 

70541 Magnetic resonance angiography, head and/or neck, with or without contrast material(s). 

70542 MR (e.g., proton) imaging, orbit, face, and neck; with contrast material 

70543 MR (e.g., proton) imaging, orbit, face, and neck; without contrast material, followed by contrast material(s) and 

further sequences. 

70544 MR angiography, head; without contrast material(s) 

70545 MR angiography, head; with contrast material(s) 

70546 MR angiography, head; without contrast material, followed by contrast material(s) and further sequences. 

70547 MR angiography, neck; without contrast material(s) 

70548 MR angiography, neck; with contrast material(s) 

70549 MR angiography, neck; without contrast material, followed by contrast material(s) and further sequences. 

70551 Magnetic resonance (e.g., proton) imaging, brain (including brain stem); without contrast material 

70552 Magnetic resonance (e.g., proton) imaging, brain (including brain stem); with contrast material(s). 

70553 Magnetic resonance (e.g., proton) imaging, brain (including brain stem); without contrast material, followed by 

contrast material(s) and further sequences. 

55 

Appendix C. Patient Characteristics: ICD-9-CM Codes and 

Clinical Expert Comments for Three 

Procedures 

57 
Cataract Surgery Patient Characteristics 

Characteristic for Cataract Surgery ICD-9-CM Codes Reason for increased facility cost (

clinical expert) 

Age > 85 years --- takes longer/dense cataract Dementia If hcc049 = 1 or if any diagnosis code on 

any claim in any setting during all 12 months of 2001 = 290.0 Senile dementia, simple type 331.0 Alzheimer's disease 331.82 Dementia with Lewy bodies (includes Dementia with Parkinsonism) 331.1 Frontotemporal dementia

spend more time to consent for Sx; mexplain tests; more time to explain me

Chronic obstructive pulmonary disease with hospitalization or emergency department visit within past one year 

if any diagnosis code on any claim in any inpatient or hospital outpatient setting during all 12 months of 2001 = 491 Chronic bronchitis 491.21 With (acute) exacerbation 492 Emphysema 416.9 Chronic pulmonary heart disease, unspecified Chronic cardiopulmonary disease, Cor pulmonale (chronic) NOS

takes longer chair time if lugging O2 ctime to position on op. table 

Bronchietasis with acute exacerbation if any diagnosis code on any claim in any 

setting during all 12 months of 2001 = 494.1 Bronchiectasis with acute exacerbation

takes longer chair time if lugging O2, position on op. table 

Barbiturate, chlordiazepoxide, diazepam, glutethimide, meprobamate, or methaqualone dependence or Opioid type dependence 

if HCC052 = 1 OR IF any diagnosis code on any claim in any setting during all 12 months of 2001 = 304.1 Barbiturate and similarly acting sedative or hypnotic dependence 304.0 Opioid type dependence 

more time and effort by anesthesiologfor nurses and MDs to recover postop

58 
Characteristic for Cataract 

Surgery 

ICD-9-CM Codes Reason for increased facility cost (a

clinical expert) 

Alcohol abuse If hcc053=1 or if any diagnosis code on any claim in 

any setting during all 12 months of 2001 = 305.0, 

303, 303.0, 303.00, 303.01, 303.02, 303.9, 303.90, 303.91, 303.92 

305.0 Alcohol abuse 303 Alcohol dependence syndrome 303.0 Acute alcoholic intoxication 303.9 Other and unspecified alcohol dependence 

The following fifth-digit subclassification is for use with category 303: 0 unspecified 1 continuous 2 episodic 3 in remission (we should not include “in remission” patients) 

more time and effort by anesthesiologfor nurses and MDs to recover postop

Personal history of allergy to anesthetic agent 

if any diagnosis code on any claim in any setting during all 12 months of 2001 = V14.4 Anesthetic agent

Different meds may be needed 

Personal history of allergy to narcotic agent 

if any diagnosis code on any claim in any setting during all 12 months of 2001 = V14.5 Narcotic agent 

Different meds may be needed 

Personal history of allergy to analgesic agent 

if any diagnosis code on any claim in any setting during all 12 months of 2001 = V14.6 Analgesic agent

Different meds may be needed 

History of shock due to anesthesia in which correct substance was properly administered 

if any ICD-9-CM code on any claim in any setting before the procedure date during 2001 = 995.4 shock due to anesthesia 

Different meds may be needed 

Anxiety If hcc059 = 1 or if any diagnosis code on any claim in 

any setting during all 12 months of 2001 = 300.0 

Anxiety states 

longer time with tech, more time to exsedate 

Schizophrenic disorder If hcc054 = 1 or if any diagnosis code on any claim in 

any setting during all 12 months of 2001 = 295 Schizophrenic disorder V11.0 Schizophrenia

longer time with tech, more time to ex

59 
Characteristic for Cataract Surgery ICD-9-CM Codes Reason for increased facility cost (

clinical expert) 

Essential, Benign, or Drug-Related Tremor/ Abnormal head movements, Fasciculations, Spasms or Tremor Not Otherwise Specified 

if any diagnosis code on any claim in any setting during all 12 months of 2001 = 

781.0 or 333.1. Please check all 2001 claims, both before and after the procedure date. 

takes longer to obtain measuremts of difficult to obtain good view thruout su

Subluxation of lens if any ICD-9-CM code on any claim in any 

setting before the procedure dateduring 2001 = 379.32 Subluxation of lens 

takes longer and longer chair time to surgery 

Recession of chamber angle if any ICD-9-CM code on any claim in any 

setting before the procedure dateduring 2001 = 364.77 Recession of chamber angle

takes longer and longer chair time to surgery 

Pseudoexfoliation of lens capsule if any ICD-9-CM code on any claim in any 

setting before the procedure dateduring 2001 = 366.11 Pseudoexfoliation of lens capsule

takes longer and longer chair time to surgery 

Progressive high (degenerative) myopia/malignant myopia 

if any ICD-9-CM code on any claim in any setting before the procedure dateduring 2001 = 360.21 Progressive high (degenerative) myopia Malignant myopia 

takes longer and may need to special lens implant (which takes time) 

Dislocation of lens if any ICD-9-CM code on any claim in any 

setting before the procedure dateduring 2001 = 379.33 Anterior dislocation of lens 379.34 Posterior dislocation of lens 

takes longer and longer chair time to surgery 

History of ruptured globe No codes available takes longer and longer chair time to 

surgery 

60 
Characteristic for Cataract Surgery ICD-9-CM Codes Reason for increased facility cost (

clinical expert) 

History of open wound of adnexa if any ICD-9-CM code on any claim in any 

setting before the procedure dateduring 2001 = 870 Open wound of ocular adnexa 

takes longer (should be okay) 

Endothelial corneal dystrophy, including combined corneal dsystrophy, cornea guttata, and Fuch's endothelial dystrophy 

if any ICD-9-CM code on any claim in any setting before the procedure dateduring 2001 = 371.57 endothelial corneal dystrophy 

takes longer need extra tests (corneamicroscopy), longer chair time to expl

Posterior synechiae if any ICD-9-CM code on any claim in any 

setting before the procedure dateduring 2001 = 364.71 Posterior synechiae

takes longer and longer chair time to surgery 

History of vitrectomy if any HCPCS/CPT code on any claim in 

any setting before the procedure dateduring 2001 = 67005, 67036, 67108 (NOTE: code added since Phase 1),67010, 67040, 67038, 67039 

may take longer if complications, and to explain risks of surgery 

61 
Colonoscopy Patient Characteristics 

Characteristic for 

Colonoscopy 

ICD-9-CM Codes Reason for increased facility cost (acc

Age > 70 years --- Takes longer; colon redudancy, longer to reco

mobile and slower in general 

Age > 85 years --- Takes longer; colon redudancy, longer to reco

mobile and slower in general 

Unstable angina in last 3 months 

if any diagnosis code on any claim in any setting during 3 months preceding procedure = 411.1 Intermediate coronary syndrome 411.89 Other Coronary insufficiency (acute), Subendocardial ischemia

there may be increased facility costs secondaat bedside, or requiring anesthesia assist. Focolonoscopy would probably be deferred excehemostasis, for at least 30d post-MI. 

MI (>30 days but fewer than 6 months) if any diagnosis code on any claim in any setting during 31-180 days preceding procedure = 

410 Acute myocardial infarction 

there may be increased facility costs secondaat bedside, or requiring anesthesia assist. 

Dementia If hcc049 = 1 or if any diagnosis code on any claim in any setting 

during all 12 months of 2001 = 290.0 Senile dementia, simple type 331.0 Alzheimer's disease 331.82 Dementia with Lewy bodies (includes Dementia with Parkinsonism) 331.1 Frontotemporal dementia 

takes longer. Dementia itself shouldn't make pas sedation works properly. If pt is uncooperanot present, this will likely increase non-MD st

Chronic obstructive pulmonary disease with hospitalization or emergency department visit within past one year 

if any diagnosis code on any claim in any inpatient or hospital outpatient setting during all 12 months of 2001 = 491 Chronic bronchitis 491.21 With (acute) exacerbation 492 Emphysema 416.9 Chronic pulmonary heart disease, unspecified Chronic cardiopulmonary disease, Cor pulmonale (chronic) NOS 

probably key issue is whether their pulm dis is procedure. If pulmonary status is fragile, then idea and risk of pulm compllications, e.g. hypoincreases. Procedure may take longer as wel

Asthma with 

hospitalization or emergency department visit within past one year 

if any diagnosis code on any claim in any inpatient or hospital outpatient setting during all 12 months of 2001 = 493.2 Chronic obstructive asthma 

probably key issue is whether their pulm dis is procedure. If pulmonary status is fragile, then idea and risk of pulm compllications, e.g. hypoincreases. Procedure may take longer as wel

Bronchietasis with acute exacerbation 

if any diagnosis code on any claim in any setting during all 12 months of 2001 = 494.1 Bronchiectasis with acute exacerbation 

probably key issue is whether their pulm dis is procedure. If pulmonary status is fragile, then idea and risk of pulm compllications, e.g. hypoincreases. Procedure may take longer as wel

62 
Characteristic for 

Colonoscopy 

ICD-9-CM Codes Reason for increased facility cost (acc

Cirrhosis if hcc026 = 1 or if any ICD-9 diagnosis code on any claim in any 

setting during all 12 months of 2001 = 571 571.2 Alcoholic cirrhosis of liver 571.5 Cirrhosis of liver without mention of alcohol 571.6 Biliary cirrhosis 

hemorrhage. This depends on pt's Child-Pugprobably minimal to no increase risk. B and C including hemorrhage risk if coags off. Also, cclearance and will increase procedure time ancareful sedation titration and possibly longer r

AMS in pts with encephalopathy. 

Cardiomyopathy/heart failure/pulmonary edema with hospitalization or emergency department visit within past one year 

If hcc080 = 1 or if any diagnosis code on any claim in any inpatient or hospital outpatient setting during all 12 months of 2001 = 428 Heart failure 398.91 Rheumatic heart failure (congestive) Rheumatic left ventricular failure 402 Hypertensive heart disease 402.01 (Malignant) With heart failure 402.11 (Benign) With heart failure 402.91 (Unspecified) With heart failure 

Again, depends on how stable pt is at time of 

to have outpt procedure, then agree that minimrequire more careful monitoring--slows proced

Malignant hypertension if any diagnosis code on any claim in any setting during all 12 

months of 2001 = 401.0 Malignant hypertension If BP not well controlled, may slow or stop pro

Barbiturate, chlordiazepoxide, diazepam, glutethimide, meprobamate, or methaqualone dependence or opioid type dependence 

If hcc052= 1 or if any diagnosis code on any claim in any setting during all 12 months of 2001 = 304.1 Barbiturate and similarly acting sedative or hypnotic dependence 304.0 Opioid type dependence 

May take longer because difficult to sedate 

Personal history of allergy to anesthetic agent 

if any diagnosis code on any claim in any setting during all 12 months of 2001 = V14.4 Anesthetic agent Procedure may take longer. More meds or dif

used. Potential complications. May need ane

Personal history of allergy to analgesic agent 

if any diagnosis code on any claim in any setting during all 12 months of 2001 = V14.6 Analgesic agent 

Procedure may take longer. More meds or difused. Potential complications. May need ane

Mechanical heart valve Note from Phase 1: ? Don't think can separate mechanical from 

bioprosthetic Antibiotics. May take longer. 

History of partial/complete bowel obstruction 

if hcc031 = 1 or if any ICD-9 diagnosis code on any claim in any setting before the procedure date during 2001 = 560, 560.0, 560.1, 560.2, 560.3, 560.8, or 560.9 takes longer 

63 
Characteristic for 

Colonoscopy 

ICD-9-CM Codes Reason for increased facility cost (acc

History of colorectal cancer 

if any ICD-9 diagnosis code on any claim in any setting before the procedure date during 2001 = 153, 153.0 – 153.9, 154, or 154.0 – 

154.8 

takes longer. Possibly b/c more careful survewith genetic predispositins or syndromes, or s

Inflammatory bowel disease 

if hcc033 = 1 or if any diagnosis code on any 2001 claim in any setting before the procedure date = 555, 555.0-555.9, 556, or 556.0-556.9 May take longer due to extensive bx. May nee

run being done. 

Melena if any diagnosis code on any 2001 claim in any setting before the 

procedure date = 578.1 May take longer if subtle bleeding source is so

looking for polyps). 

64 
65 

MRI (Brain) Patient Characteristics 

Characteristic for MRI (Brain) ICD-9-CM Codes Reason for increa

(according to clin

Age > 70 years --- in general, elderly patie

more time, but how can for this? 

Age > 85 years --- yes takes longer; if infilt

more gadiolinium 

Unstable angina in last 3 months if any diagnosis code on any claim in any setting during the 3 

months preceding the procedure = 411.1 Intermediate coronary syndrome 411.89 Other Coronary insufficiency (acute), Subendocardial ischemia

(yes if complication) takdisrupt smooth function

Myocardial infarction within past 7 days if any diagnosis code on any claim in any setting during the 7 days 

preceding the procedure = 410 Acute myocardial infarction

(yes if complication) takdisrupt smooth function

Recent myocardial infarction (> 7 days but fewer than 30 days) if any diagnosis code on any claim in any setting during 8-30 days preceding the procedure = 

410 Acute myocardial infarction

(yes if complication) takdisrupt smooth function

Orthopnea if any diagnosis code on any claim in any setting during all 12 

months of 2001 = 786.02 Orthopnea 

Yes take more time 

Dementia If hcc049 = 1 or if any diagnosis code on any claim in any setting 

during all 12 months of 2001 = 290.0 Senile dementia, simple type 331.0 Alzheimer's disease 331.82 Dementia with Lewy bodies (includes Dementia with Parkinsonism) 331.1 Frontotemporal dementia 

Yes takes longer 

Anxiety If hcc059 = 1 or if any diagnosis code on any claim in any setting 

during all 12 months of 2001 = 300.0 Anxiety states 

Yes may take longer 

History of Claustrophob ia if any diagnosis code on any claim in any setting during all 12 months 

of 2001 = 300.29 Other isolated or simple phobias—acrophobia, animal phobia, claustrophobia, fear of crowds 

Yes takes longer 

Essential, Benign, or Drug-Related Tremor/ Abnormal head movements, Fasciculations, 

Spasms, or Tremor Not Otherwise Specified 

if any diagnosis code on any claim in any setting during all 12 months of 2001 = 781.0 or 333.1. Please check all 2001 claims, both before and after the procedure date. 

Yes if head tremor, then and thus, takes longer 

Cerebral edema if any diagnosis code on any claim in any setting during all 12 months 

of 2001 = 348.5 Cerebral edema 

Yes likely to be altered would take longer
66 
Appendix D. Patient Characteristic Results for RBC and 

Non-RBC Colonoscopy 

Table D.1 Characteristics of RBC Colonoscopy Patients By Setting, Medicare Fee-for-Service, 2001 

OPD ASC Office Fisher’s exact p-value 

Number Rate* Number Rate* Number Rate* 

OPD 

vs. 

ASC 

OPD vs. 

Off 

ASC vs.

Off 

All RBC colonoscopies 34337 -- 12983 -- 1882 -- -- -- --

Age > 70 years 23152 674.3 8753 674.2 1231 654.1 0.991 0.069 0.083 

Age > 85 years 1891 55.1 602 46.4 80 42.5 0.000§ 0.019§ 0.480 

Unstable angina in last 3 months 196 5.7 47 3.6 24 12.8 0.004§ 0.001§ 0.000§

MI (>30 days but < 6 months) 1 0.0 0 0.0 0 0.0 1.000 1.000 1.000 

Dementia 1166 34.0 347 26.7 51 27.1 0.000§ 0.115 0.939 

Chronic obstructive pulmonary 

disease (COPD) with 

hospitalization or emergency 

department visit in past year 615 17.9 158 12.2 16 8.5 0.000§ 0.001§ 0.206 

Asthma with hospitalization or 

emergency department visit in past 

year 0 0.0 0 0.0 0 0.0 -- -- -- 

Bronchietasis with acute exacerbation 8 0.2 3 0.2 0 0.0 1.000 1.000 1.000 

Cirrhosis 304 8.9 102 7.9 12 6.4 0.315 0.308 0.573 

Cardiomyopathy/heart 

failure/pulmonary edema with 

hospitalization or emergency 

department visit in past year 3952 115.1 1291 99.4 221 117.4 0.000§ 0.767 0.018§

Malignant hypertension 266 7.7 65 5.0 82 43.6 0.001§ 0.000§ 0.000§

Barbiturate, chlordiazepoxide, 

diazepam, glutethimide, 

meprobamate, or methaqualone 

dependence or opioid type 

dependence 194 5.6 49 3.8 7 3.7 0.011§ 0.339 1.000 

Personal history of allergy to 

anesthetic agent 3 0.1 1 0.1 0 0.0 1.000 1.000 1.000 

Personal history of allergy to analgesic 

agent 50 1.5 26 2.0 0 0.0 0.198 0.113 0.068 

History of partial/complete bowel 

obstruction 1165 33.9 363 28.0 53 28.2 0.001§ 0.189 0.940 

History of colorectal cancer 823 24.0 178 13.7 76 40.4 0.000§ 0.000§ 0.000§

Inflammatory bowel disease 848 24.7 298 23.0 68 36.1 0.284 0.003§ 0.001§

Melena 822 23.9 145 11.2 116 61.6 0.000§ 0.000§ 0.000§

§

Comparisons in bold are significant at p<0.05. 

*Per 1,000 procedures. 

Source: RAND analysis of the 5 percent Standard Analytical Files of Medicare claims, 2001. 

67 
Table D.2 Characteristics of Non-RBC Colonoscopy Patients By Setting, Medicare Fee-for-Service, 2001 

OPD ASC Office Fisher’s exact p-value 

Number Rate* Number Rate* Number Rate* 

OPD 

vs. 

ASC 

OPD vs. 

Off 

ASC vs.

Off 

All non-RBC colonoscopies 29035 -- 10520 -- 2133 -- -- -- --

Age > 70 years 19604 675.2 7091 674.0 1439 674.6 0.817 0.943 0.980 

Age > 85 years 1677 57.8 529 50.3 101 47.4 0.004§ 0.047§ 0.623 

Unstable angina in last 3 months 159 5.5 35 3.3 15 7.0 0.007§ 0.364 0.021§

MI (>30 days but < 6 months) 0 0.0 0 0.0 0 0.0 1.000 1.000 1.000 

Dementia 1035 35.6 311 29.6 80 37.5 0.003§ 0.629 0.055

Chronic obstructive pulmonary 

disease (COPD) with 

hospitalization or emergency 

department visit in past year 407 14.0 97 9.2 17 8.0 0.000§ 0.020§ 0.706 

Asthma with hospitalization or 

emergency department visit within 

past one year 0 0.0 0 0.0 0 0.0 -- -- -- 

Bronchietasis with acute 

exacerbation 7 0.2 2 0.2 3 1.4 1.000 0.027§ 0.037§

Cirrhosis 196 6.8 55 5.2 21 9.8 0.099 0.104 0.020§

Cardiomyopathy/heart 

failure/pulmonary edema with 

hospitalization or emergency 

department visit in past year 3339 115.0 918 87.3 219 102.7 0.000§ 0.090 0.025§

Malignant hypertension 216 7.4 41 3.9 102 47.8 0.000§ 0.000§ 0.000§

Barbiturate, chlordiazepoxide, 

diazepam, glutethimide, 

meprobamate, or methaqualone 

dependence or opioid type 

dependence 137 4.7 29 2.8 4 1.9 0.008§ 0.064 0.642 

Personal history of allergy to 

anesthetic agent 1 0.0 1 0.1 0 0.0 0.461 1.000 1.000 

Personal history of allergy to analgesic 

agent 52 1.8 11 1.0 1 0.5 0.116 0.267 0.704 

History of partial/complete bowel 

obstruction 1081 37.2 306 29.1 71 33.3 0.000§ 0.373 0.295 

History of colorectal cancer 764 26.3 138 13.1 78 36.6 0.000§ 0.007§ 0.000§

Inflammatory bowel disease 280 9.6 81 7.7 35 16.4 0.073 0.005§ 0.000§

Melena 731 25.2 130 12.4 113 53.0 0.000§ 0.000§ 0.000§

§

Comparisons in bold are significant at p<0.05. 

*Per 1,000 procedures. 

Source: RAND analysis of the 5 percent Standard Analytical Files of Medicare claims, 2001. 

68 
Appendix E. Patient Characteristic Results for MRI (Brain) 

With and Without Contrast 

Table E.1 Characteristics of Patients with MRI (Brain) With Contrast By Setting, Medicare Fee-for-Service, 

2001 

OPD Office IDTF Fisher’s exact p-value 

Number Rate* Number Rate* Number Rate* OPD vs. 

Office 

OPD vs. 

IDTF 

Office vs. 

IDTF 

All MRI (brain) with contrast 13199 -- 7742 -- 2410 -- 

Age > 70 years 8587 650.6 5314 686.4 1606 666.4 0.000§ 0.136 0.068 

Age > 85 years 986 74.7 532 68.7 160 66.4 0.109 0.161 0.711 

Unstable angina in last 3 

months 88 6.7 62 8.0 8 3.3 0.271 0.064 0.016§

Myocardial infarction within 

past 7 days 0 0.0 1 0.1 0 0.0 0.370 0.370 1.000 

Recent myocardial infarction 

(> 7 days but fewer than 30 

days) 0 0.0 0 0.0 0 0.0 1.000 1.000 1.000 

Orthopnea 20 1.5 19 2.5 1 0.4 0.137 0.235 0.062

Dementia 1080 81.8 776 100.2 162 67.2 0.000§ 0.014§ 0.000§

Anxiety 127 9.6 85 11.0 21 8.7 0.353 0.733 0.421 

History of claustrophob ia 6 0.5 3 0.4 1 0.4 1.000 1.000 1.000 

Essential, benign, or drugrelated tremor/abnormal 

head movements, 

fasciculations, spasms, or 

tremor not otherwise 

specified 276 20.9 364 47.0 37 15.4 0.000§ 0.082 0.000§

Cerebral edema 60 4.5 15 1.9 5 2.1 0.002§ 0.087 0.798 

§ Comparisons in bold are significant at p<0.05. 

*Per 1,000 procedures. 

Source: RAND analysis of the 5 percent Standard Analytical Files of Medicare claims, 2001. 

69 
Table E.2 Characteristics of MRI (Brain) Without Contrast Patients By Setting, Medicare Fee-for-Service, 2001 

OPD Office IDTF Fisher’s exact p-value 

Number Rate* Number Rate* Number Rate* OPD vs. 

Office 

OPD vs. 

IDTF 

Office vs. 

IDTF 

All MRI (brain) without 

contrast 8034 -- 6970 -- 2142 -- 

Age > 70 years 5692 708.5 5079 728.7 1475 688.6 0.006§ 0.074 0.000§

Age > 85 years 759 94.5 635 91.1 199 92.9 0.481 0.868 0.797 

Unstable angina in last 3 

months 54 6.7 68 9.8 11 5.1 0.045§ 0.541 0.045§

Myocardial infarction within 

past 7 days 0 0.0 1 0.1 0 0.0 0.465 0.465 1.000 

Recent myocardial infarction 

(> 7 days but fewer than 30 

days) 0 0.0 1 0.1 0 0.0 0.465 0.465 1.000 

Orthopnea 7 0.9 17 2.4 1 0.5 0.023§ 1.000 0.093 

Dementia 837 104.2 923 132.4 203 94.8 0.000§ 0.213 0.000§

Anxiety 74 9.2 87 12.5 21 9.8 0.057 0.800 0.362 

History of claustrophob ia 3 0.4 4 0.6 3 1.4 0.712 0.112 0.366 

Essential, benign, or drugrelated tremor/abnormal 

head movements, 

fasciculations, spasms, or 

tremor not otherwise 

specified 173 21.5 364 52.2 42 19.6 0.000§ 0.613 0.000§

Cerebral edema 9 1.1 0 0.0 1 0.5 0.005§ 0.699 0.235 

§

 Comparisons in bold are significant at p<0.05. 

*Per 1,000 procedures. 

Source: RAND analysis of the 5 percent Standard Analytical Files of Medicare claims, 2001. 

70 
Table E.3 Characteristics of MRI (Brain) With Contrast Patients By OPD and IDTF/Office Combined, 

Medicare Fee-for-Service, 2001 

OPD IDTF/Office 

 Number Rate* Number Rate* 

Fisher’s exact

p-value 

All MRI (brain) with contrast 13199 -- 10152 -- 

Age > 70 years 8587 650.6 6920 681.6 0.000§

Age > 85 years 986 74.7 692 68.2 0.055 

Unstable angina in last 3 months 88 6.7 70 6.9 0.872 

Myocardial infarction within past 7 days 0 0.0 1 0.1 0.435 

Recent myocardial infarction (> 7 days but fewer 

than 30 days) 0 0.0 0 0.0 0.476 

Orthopnea 20 1.5 20 2.0 0.428 

Dementia 1080 81.8 938 92.4 0.004§

Anxiety 127 9.6 106 10.4 0.550 

History of claustrophob ia 6 0.5 4 0.4 1.000 

Essential, benign, or drug-related 

tremor/abnormal head movements, 

fasciculations, spasms, or tremor not 

otherwise specified 276 20.9 401 39.5 0.000§

Cerebral edema 60 4.5 20 2.0 0.001§

§

 Comparisons in bold are significant at p<0.05. 

*Per 1,000 procedures. 

Source: RAND analysis of the 5 percent Standard Analytical Files of Medicare claims, 2001. 

71 
Table E.4 Characteristics of MRI (Brain) Without Contrast Patients By OPD and IDTF/Office Combined, 

Medicare Fee-for-Service, 2001 

OPD IDTF/Office 

 Number Rate* Number Rate* 

Fisher’s exact

p-value 

All MRI (brain) without contrast 8034 -- 9112 -- 

Age > 70 years 5692 708.5 6554 719.3 0.123

Age > 85 years 759 94.5 834 91.5 0.510 

Unstable angina in last 3 months 54 6.7 79 8.7 0.163 

Myocardial infarction within past 7 days 0 0.0 1 0.1 1.000 

Recent myocardial infarction (> 7 days but fewer 

than 30 days) 0 0.0 1 0.1 1.000 

Orthopnea 7 0.9 18 2.0 0.071 

Dementia 837 104.2 1126 123.6 0.000§

Anxiety 74 9.2 108 11.9 0.100 

History of claustrophob ia 3 0.4 7 0.8 0.353 

Essential, benign, or drug-related 

tremor/abnormal head movements, 

fasciculations, spasms, or tremor not 

otherwise specified 173 21.5 406 44.6 0.000§

Cerebral edema 9 1.1 1 0.1 0.008§

§

 Comparisons in bold are significant at p<0.05. 

*Per 1,000 procedures. 

Source: RAND analysis of the 5 percent Standard Analytical Files of Medicare claims, 2001. 

72 
Appendix F. Contract Deliverable: Proposed Outcome Measures for Risk Adjustment 

Introduction 

In the Phase 1 study, we identified a set of outcome measures for each of three 

procedures that are performed in multiple ambulatory settings (cataract surgery, colonoscopy, 

and MRI (brain)). Each outcome measure represents an adverse event that might occur as a 

result of a patient having the procedure. Three expert panels, one for each procedure, were set 

up in the Phase 1 study to discuss and rate the outcome measures. The panels rated 27 outcome 

measures for cataract surgery, 20 outcome measures for colonoscopy, and 18 outcome measures 

for MRI (brain) on preventability and severity (Table 1). 

The objective of the Phase 2 study is to determine whether variation across ambulatory 

settings in the rate of adverse outcomes following the three procedures is related to differences in 

the characteristics of the Medicare beneficiaries receiving care in the different settings. In this 

document, we provide the results of Task 3 of the Phase 2 study which consists of compiling a 

list of outcome measures for each of the three procedures to be recommended for further analysis 

using risk adjustment. We first describe the methods used to select the outcomes, followed by 

the recommendations regarding outcomes for cataract surgery, colonoscopy, and MRI (brain).

Methods 

For each of the three procedures, we selected outcome measures recommended for 

further analysis on the basis of several factors. We first determined whether the outcome might 

also be an indication for (i.e., reason for having) the procedure based on input from the project 

physician and the three clinical consultants. Outcomes that are also indications for the procedure 

were eliminated from consideration. We also considered the severity and preventability ratings 

of the Phase 1 expert panels, and the frequency of the outcome. We attempted to identify 

outcomes that are severe, preventable, and frequent. We created a table for each procedure 

containing rows representing the outcome measures and columns representing: 

• the preventability scores (Table 2) 

• the severity scores (Table 2) 

• the incidence of the outcome (per 1000 procedures) 

• whether the outcome could be an indication for the procedure. 

These data were derived from the rating sheets completed by the Phase 1 panels and the tables 

based on the Phase 1 claims analysis in the Phase 1 report (Wynn et al., 2004) as well as input 

from the Phase 2 clinical consultants. We used the information in these tables as the basis for 

recommending outcome measures for further analysis. 

We also determined the most appropriate time frame for measuring each outcome based 

on information from the Phase 1 panel discussions and input from the three Phase 2 clinical 

consultants regarding the likelihood of the outcome being the result of the procedure within a 

certain time period. For the possible covariates, we included patient characteristics that might 

influence the outcomes of the procedure, including input from the project physician and the three 

Phase 2 clinical consultants regarding what patient characteristics would affect which outcomes. 

The suggested covariates include demographic characteristics (e.g., age, gender, race), Medicaid 

eligibility, and disability status as well as comorbidities (e.g., diabetes) that might affect 

73 
Table F.1 Adverse Outcomes Listed in Phase 1 Ratings Sheets for Three Procedures 

Cataract Surgery Colonoscopy MRI (Brain) 

A Arrhythmia A Abdominal pain A Altered mental status 

B Capsule rupture or posterior 

capsule tear 

B Altered mental status B Anaphylaxis/anaphylactoid 

reaction 

C New or worsening congestive 

heart failure 

C Arrhythmia C Bradycardia 

D Persistent cystoid macular 

edema (Diabetic vs. nondiabetic) 

D Chest pain D Chest pain 

E Death E Death E Death 

F Endophthalmitis F Dyspnea F Dizziness 

G Hypertension G Hemorrhage G Dyspnea 

H Hypotension H Hypertension H Headache 

I Iris prolapse I Hypotension I Hypertension 

J Myocardial infarction J Hypoxia J Hypotension 

K Retained nuclear fragment 

(posterior chamber vs. anterior 

chamber) 

K Perforation K Ocular injury 

L Ocular hypertension L Post-polypectomy 

syndrome 

L Paresthesia 

M Persistent iridocyclitis M Rash 

N Poor ocular motility, excluding 

cranial VII palsy 

A Abdominal distension N Seizure 

O Retinal break B Endocarditis O Syncope 

P Retinal detachment (complicated 

versus uncomplicated surgery) 

C Sepsis and other 

infections 

P Tachycardia 

Q Stroke D Small bowel obstruction Q Vasodilatation 

R Wound dehiscence E Splenic rupture R Vasospasm 

S Wound leak F Splenic trauma 

T Aspiration pneumonia G Vasovagal reactions 

U Respiratory failure from surgery 

V Hyphema 

W Persistent corneal edema 

X Vitreous loss 

Y Secondary glaucoma 

Z Dislocated ocular lenses 

A

A 

Iris/pupil deformation 

74 
Table F.2 Definition of Scale Used by Phase 1 Panels to Rate Preventability and Severity 

Dimension Definition Scale 

Preventability Likelihood that an outcome can be avoided if 

the individuals or system involved in 

delivering care follow standard practices. 

(Adapted from Hofer and Haywood, 2002). 

1 = Not preventable 

5 = Somewhat 

 preventable 

9 = Definitely 

 preventable 

Severity The potential effect of the outcome of the 

procedure on the patient’s life expectancy and 

quality of life. 

1 = Not severe 

5 = Somewhat severe 

9 = Very severe 

the occurrence of a particular adverse outcome. The variables representing comorbidities will be 

derived from DxCG subscores representing specific conditions. The covariates listed on the 

following pages are preliminary and will be modified as necessary before and during the 

analysis. 

Results 

We attempted to identify 4 – 7 measures for each procedure as specified in the project scope of 

work. However, given that these are relatively safe procedures with a low rate of complications, 

identifying this number of meaningful outcome measures was challenging. Many of the 

potential outcomes were eliminated on the basis of being an indication for having the procedure 

performed, especially those for colonoscopy (e.g., abdominal pain) and MRI (brain) (e.g., 

dizziness). Of those remaining, we tried to identify outcomes that are severe, preventable, and 

frequent, and can reasonably be assumed to have occurred as a result of the procedure. We 

focused primarily on outcomes related to the organ affected by the procedure, because it is more 

difficult to establish that the general medical outcomes occur as a result of the procedures, 

especially using claims data as supporting evidence. 

On the following pages and in Tables 3 through 5 (in the attached Excel file), we provide the 

evidence used as the basis for recommending the subset of outcomes for further analysis. We 

recommend analyzing four outcomes for cataract surgery outcomes, two outcomes for 

colonoscopy, and one outcome for MRI (brain). Given the limited selection, we have also 

included some measures that do not meet all the criteria used in the selection process, for 

purposes of discussion. In this category, we considered, but are not recommending, four 

measures for cataract surgery, seven measures for colonoscopy, and two measures for MRI 

(brain). On the following pages, we have labeled each measure we considered either as 

“recommended for further analysis” or “considered but not recommended for further analysis.” 

For each outcome, we present the reason it was selected or not selected, the severity and 

preventability ratings by the Phase 1 panels, and the rate of occurrence within 30 days of the 

procedure. Note that higher panel ratings on the severity and preventability scales indicate more 

severe and more preventable, respectively (Table 2). We also present the most appropriate time 

frame for measuring each outcome, and a set of patient characteristics for use as covariates in the 

risk adjustment. 

75 
Proposed Outcome Measures for Cataract Surgery 

Cataract removal surgeries are among the most common surgeries performed in the United States 

(National Eye Institute, 2003). Most cataract removal surgeries are uncomplicated and lead to 

improved visual acuity and patient satisfaction. In some cases, however, postoperative 

complications related to the eye arise. In other cases, complications occur from the sedation or 

anesthesia used during the procedure, as well as from the local (injected) anesthesia (Shugarman 

et al., 2004). 

In selecting the recommended outcome measures, we considered a list of 30 outcome measures 

for cataract surgery, including the initial set of 27 that were rated and discussed as part of the 

Phase 1 panel process, plus three outcomes that were added during or after the Phase 1 panel 

meeting. We recommend that four of these measures be analyzed further using risk adjustment. 

They are: 

•Endophthalmitis (F) 

•Cataract fragments in eye (CC) 

• Persistent corneal edema (W) 

• Iris prolapse (I) 

We considered but are not recommending another four measures: 

•Retained nuclear fragment (K) 

• Secondary glaucoma (Y) 

•Aspiration pneumonia (T) 

•Respiratory failure from surgery (U) 

For each of these measures, we list the reasons for recommending or not recommending it, the 

time frame for analysis, and factors to be used in risk adjustment in the table below. The 

supporting evidence for the entire set of cataract surgery outcomes is provided in Table 3 (in the 

attached Excel file). 

Of those outcomes not considered for further analysis, three were dropped because they are 

indications for having cataract surgery; these are persistent cystoid macular edema, retinal break, 

and retinal detachment. Four additional outcome measures (capsule rupture or posterior capsule 

tear, new or worsening congestive failure, wound dehiscence, and wound leak) were eliminated 

because there are no ICD-9 codes that can be used to identify the conditions in claims data. The 

remaining 15 outcomes were not considered to be suitable outcomes for cataract surgery 

(arrhythmia, death, hypertension, hypotension, myocardial infarction, ocular hypertension, 

persistent iridocyclitis, poor ocular motility, stroke, hyphema, vitreous loss, dislocated ocular 

lenses, iris-pupil deformation, nausea and vomiting, and other complications). 

Recommended for further analysis 

Measure: Endophthalmitis (F) 

Reason for status: Endophthalmitis is an infection of the vitreous or aqueous humor of the eye 

that might occur following cataract surgery. It is recommended for further analysis because it is 

a severe condition that can be prevented. However, it occurs infrequently, so the results would 

have to be interpreted with caution. It occurred within 30 days in 113 of 77,572 patients (1.5 per 

1000) with cataract surgeries performed in the three sites combined (HOPD, ASC, and office). 

Endophthalmitis was considered to be severe (all 6 panelists rating it 8 or 9) and preventable (all 

5 panelists rating it 5 or 7).

Time frame for analysis: Within 30 days

76 
Patient characteristics for risk adjustment model: 

•Age 

•Gender 

•Race/ethnicity 

•Medicaid eligible 

•Disability status 

•Diabetes 

•Rheumatoid arthritis 

• Systemic lupus erythematosus 

•AIDS 

•Leukemia 

•Lymphoma 

•Essential, benign, or drug-related tremor 

•Abnormal head movements, fasciculations, spasms or tremor not otherwise specified 

Recommended for further analysis 

Measure: Cataract fragments in eye (CC) 

Reason for status: Cataract fragments in eye describes a medical condition in which a part of 

the cataract falls into the eye. It is recommended for further analysis because the Phase 1 panel 

thought it was important enough to add it to the list of outcomes. However, it occurs 

infrequently, so the results would have to be interpreted with caution. Although the Phase 1 

panel did not rate this outcome, the Phase 2 clinical consultant for cataract surgery rated it a 4 on 

the severity scale and a 7 on the preventability scale. It occurred within 30 days in 92 of 77,572 

patients (1.2 per 1000) with cataract surgeries performed in the three sites combined (HOPD, 

ASC, and office). 

Time frame for analysis: Within 30 days

Patient characteristics for risk adjustment model: 

•Age 

•Gender 

•Race/ethnicity 

•Medicaid eligible 

•Disability status 

• Pseudoexfoliation of lens capsule 

•History of ruptured globe 

•History of vitrectomy 

• Pupillary abnormalities (364.75) 

•Essential, benign, or drug-related tremor 

•Abnormal head movements, fasciculations, spasms or tremor not otherwise specified 

Recommended for further analysis

Measure: Persistent corneal edema (W) 

Reason for status: Persistent corneal edema is the prolonged swelling of the corneal tissues 

beyond the normal healing period for cataract surgery. It is recommended for further analysis 

because it is a severe condition that can be prevented. However, it occurs infrequently, so the 

results would have to be interpreted with caution. It occurred within 30 days in 54 of 77,572 

77 
patients (0.7 per 1000) with cataract surgeries performed in the three sites combined (HOPD, 

ASC, and office). Persistent corneal edema was considered to be moderately severe (all 6 

panelists rating it 5 or 7) and preventable (5 of 6 panelists rating it 7 or 8). 

Time frame for analysis: Within 30 days 

Patient characteristics for risk adjustment model: 

•Age 

•Gender 

•Race/ethnicity 

•Medicaid eligible 

•Disability status 

•Diabetes 

•Essential, benign, or drug-related tremor 

•Abnormal head movements, fasciculations, spasms or tremor not otherwise specified 

Recommended for further analysis

Measure: Iris prolapse (I) 

Reason for status: Iris prolapse is a condition in which a portion of the pigmented part of the 

iris sags into the eye. It is considered to be a complication of cataract surgery. It is 

recommended for further analysis because it is a somewhat severe condition that can be 

prevented. However, it occurs infrequently, so the results would have to be interpreted with 

caution. It occurred within 30 days in 62 of 77,572 patients (0.8 per 1000) with cataract 

surgeries performed in the three sites combined (HOPD, ASC, and office). Iris prolapse was 

considered to be somewhat severe (4 of 6 panelists rating it 5 or 7) and preventable (5 of 6 

panelists rating it 8). 

Time frame for analysis: Within 30 days 

Patient characteristics for risk adjustment model: 

•Age 

•Gender 

•Race/ethnicity 

•Medicaid eligible 

•Disability status 

• Pseudoexfoliation of lens capsule 

•History of ruptured globe 

•History of vitrectomy 

• Pupillary abnormalities (364.75) 

•Essential, benign, or drug-related tremor 

•Abnormal head movements, fasciculations, spasms or tremor not otherwise specified 

Considered but not recommended for further analysis

Measure: Retained nuclear fragment (K) 

Reason for status: Although it might be a good outcome measure, retained nuclear fragment is 

not recommended because it is a subset of the category listed above, “cataract fragments in eye.” 

In addition, there are no ICD-9 codes to identify retained nuclear fragment directly; it has to be 

identified indirectly using the procedure code for vitrectomy. It is a moderately severe condition 

that can be prevented. It occurred within 30 days in 473 of 77,572 patients (6.1 per 1000) with 

78 
cataract surgeries performed in the three sites combined (HOPD, ASC, and office). Retained 

nuclear fragment was considered to be somewhat severe (all 6 panelists rating it 5 or 6) and 

preventable (5 of 6 panelists rating it 6 or 8). 

Time frame for analysis: Within 30 days 

Patient characteristics for risk adjustment model: 

•Age 

•Gender 

•Race/ethnicity 

•Medicaid eligible 

•Disability status 

• Pseudoexfoliation of lens capsule 

•History of ruptured globe 

•History of vitrectomy 

•Essential, benign, or drug-related tremor 

•Abnormal head movements, fasciculations, spasms or tremor not otherwise specified 

Considered but not recommended for further analysis

Measure: Secondary glaucoma (Y) 

Reason for status: Secondary glaucoma is not recommended because it would be difficult to 

distinguish between primary and secondary glaucoma using claims data because there is not a 

separate ICD-9 code for secondary glaucoma. Therefore, it would be difficult to establish that 

the occurrence of glaucoma was a result of the procedure. It is a moderately severe condition 

that can be prevented. It occurred within 30 days in 154 of 77,572 patients (2.0 per 1000) with 

cataract surgeries performed in the three sites combined (HOPD, ASC, and office). Secondary 

glaucoma was considered to be somewhat severe (all 5 panelists rating it 5 or 6) and moderately 

preventable (all 6 panelists rating it 5, 6, or 7). 

Time frame for analysis: Within 30 days 

Patient characteristics for risk adjustment model: 

•Age 

•Gender 

•Race/ethnicity 

•Medicaid eligible 

•Disability status 

• Subluxation of lens 

•Recession of chamber angle 

• Pseudoexfoliation of lens capsule 

•Dislocation of lens 

•History of ruptured globe 

•History of vitrectomy 

•Diabetes 

•Myopia 

•Hypothyroidism 

•Hypertension 

•Hyperlipidemia 

•Chronic renal failure 

79 
• Peripheral vascular disease 

•Essential, benign, or drug-related tremor 

•Abnormal head movements, fasciculations, spasms or tremor not otherwise specified 

Considered but not recommended for further analysis 

Measure: Aspiration pneumonia (T) 

Reason for status: Aspiration pneumonia was considered because it is a severe condition that 

can be prevented. It is not recommended, however, because it occurs very infrequently. 

Aspiration pneumonia was considered to be severe (all 6 panelists rating it 7 or 8) and somewhat 

preventable (3 of 5 panelists rating it 7 or 8). It occurred within 30 days in 16 of 77,572 patients 

(0.2 per 1000) with cataract surgeries performed in the three sites combined (HOPD, ASC, and 

office). 

Time frame for analysis: Within 7 days

Patient characteristics for risk adjustment model: 

•Age 

•Gender 

•Race/ethnicity 

•Medicaid eligible 

•Disability status 

•Dementia 

• Stroke 

•COPD (include ICD 9 codes 490 thru 496) 

•Dysphagia (438.82, 787.2) 

• Parkinson’s disease 

•Myasthenia gravis (358.0) 

• Pseudobulbar palsy (335.23) 

•Tracheostomy (v44.0, v55.0; 519) 

Considered but not recommended for further analysis 

Measure: Respiratory failure from surgery (U) 

Reason for status: Respiratory failure from surgery was considered because it is a severe 

condition that can be prevented. It is not recommended, however, because it occurs very 

infrequently. Respiratory failure from surgery was considered to be severe (all 6 panelists rating 

it 5, 7 or 8) and somewhat preventable (3 of 5 panelists rating it 5 or 8). It occurred within 30 

days in 22 of 77,572 patients (0.3 per 1000) with cataract surgeries performed in the three sites 

combined (HOPD, ASC, and office). 

Time frame for analysis: Within 7 days

Patient characteristics for risk adjustment model: 

•Age 

•Gender 

•Race/ethnicity 

•Medicaid eligible 

•Disability status 

•Diabetes 

•Hypertension 

80 
•Hyperlipidemia 

•Chronic renal failure 

•Rheumatoid arthritis 

• Systemic lupus erythematosus 

•AIDS 

• Peripheral vascular disease 

•COPD (ICD 9 codes 490 thru 496) 

•Leukemia 

•Lymphoma 

81 
Proposed Outcome Measures for Colonoscopy 

Colonoscopy is a commonly performed procedure used to screen for colorectal cancer, but it is 

also used to diagnose the causes of unexplained changed in bowel habits, which may be caused 

by cancer or some other disease/condition. Therapeutic colonoscopies can be performed to 

remove polyps and to treat bleeding in the colon. Generally, the procedure is performed under 

some level of sedation and/or with pain medication. Most colonoscopies are uncomplicated and 

effectively diagnose and treat various gastrointestinal conditions. However, intra-operative and 

post-operative complications might arise, including some conditions related to the colon and 

others unrelated to the colon but associated with sedation (Shugarman et al., 2004). 

In selecting the recommended outcome measures, we considered a list of 20 outcome measures 

for colonoscopy, including the initial set of 19 that were rated and discussed as part of the Phase 

1 panel process, plus one outcome that was added after the Phase 1 panel meeting. We 

recommend that two of these measures be analyzed further using risk adjustment. They are: 

• Perforation (K) 

• Splenic rupture (E) 

We considered, but are not recommending, seven other measures: 

• Small bowel obstruction (DD) 

•Vasovagal reaction (GG) 

•Dyspnea (F) 

•Arrhythmia (C) 

•Chest pain (D) 

•Altered mental status (B) 

•Death (E) 

For each of these measures, we list the reasons for recommending or not recommending it, the 

time frame for analysis, and factors to be used in risk adjustment in the table below. The 

supporting evidence for the entire set of colonoscopy outcomes is provided in Table 4 (in the 

attached Excel file). 

Of those outcomes not considered for further analysis, five were dropped because they are 

indications for having a colonoscopy; these are abdominal pain, hemorrhage, abdominal 

distension, sepsis and other infections, and hypotension. One outcome measure (postpolypectomy syndrome) was eliminated because there are no ICD-9 codes that can be used to 

identify the condition in claims data. The remaining five outcomes were not considered to be 

suitable outcomes for colonoscopy (hypertension, hypoxia, endocarditis, splenic trauma, and 

other complications). 

Recommended for further analysis 

Measure: Perforation (K) 

Reason for status: Perforation is a puncture of the intestine which occurs very infrequently 

during colonoscopy. Once perforation has occurred, the contents of the intestine spill into the 

abdominal cavity. This is problematic because the intestine is full of bacteria that should not be 

in the abdominal cavity, and might result in a severe infection. Perforation was selected because 

it is a severe condition that can usually be avoided. However, it occurs infrequently, so the 

results would have to be interpreted with caution. Perforation was considered to be severe (all 8 

panelists rating it 6, 8 or 9) and moderately preventable (6 of 9 panelists rating it 5 or 8). It 

82 
occurred within 30 days in 73 of 90,890 patients (0.8 per 1000) with colonoscopies performed in 

the three sites combined (HOPD, ASC, and office). 

Time frame for analysis: Within 7 or 30 days

Patient characteristics for risk adjustment model: 

•Age 

•Gender 

•Race/ethnicity 

•Medicaid eligible 

•Disability status 

•History of partial bowel obstruction 

•History of complete bowel obstruction 

•History of colorectal cancer 

• Inflammatory bowel disease 

•Melena 

Recommended for further analysis 

Measure: Splenic rupture 

Reason for status: Splenic rupture is a bursting of the spleen that results in red blood cells 

spilling from the spleen into the abdominal cavity. The patient may lose blood volume and 

blood pressure may drop dramatically, and the patient may experience severe abdominal pain. 

Splenic rupture is recommended for further analysis because it is a severe condition that was 

considered to be preventable by the panel. However, it occurs very infrequently, so the results 

would have to be interpreted with extreme caution. Splenic rupture was rated as severe (all 7 

panelists rating it 8 or 9) and preventable (6 of 9 panelists rating it 5, 7, or 8). It occurred within 

30 days in 35 of 90,890 patients (0.4 per 1000) with colonoscopies performed in the three sites 

combined (HOPD, ASC, and office). 

Time frame for analysis: Within 7 or 30 days

Patient characteristics for risk adjustment model: 

•Age 

•Gender 

•Race/ethnicity 

•Medicaid eligible 

•Disability status 

• Splenomegaly (789.2) 

•Anomalies of spleen (759.0) 

•Chronic congestive splenomegaly (289.51) 

•Cirrhosis 

•History of partial bowel obstruction 

•History of complete bowel obstruction 

•History of colorectal cancer 

• Inflammatory bowel disease 

•Melena 

Considered but not recommended for further analysis 

Measure: Small bowel obstruction (D) 

83 
Reason for status: Small bowel obstruction was considered for further analysis because it is a 

severe condition and occurs frequently enough to test for differences among settings. However, 

it is not recommended because it was not considered to be preventable by the panel. Small 

bowel obstruction was rated as severe (all 8 panelists rating it 6, 7, 8 or 9) but not preventable (8 

of 9 panelists rating it 1, 2, or 3). It occurred within 30 days in 528 of 90,890 patients (5.8 per 

1000) with colonoscopies performed in the three sites combined (HOPD, ASC, and office). 

Time frame for analysis: Within 7 days

Patient characteristics for risk adjustment model: 

•Age 

•Gender 

•Race/ethnicity 

•Medicaid eligible 

•Disability status 

•Diabetes 

•Hypertension 

•Dementia 

•Hyperlipidemia 

• Stroke 

•Rheumatoid arthritis 

• Systemic lupus erythematosus 

•Chronic renal failure 

•AIDS 

• Peripheral vascular disease 

•COPD 

•Leukemia 

•Lymphoma 

•Any prior abdominal surgery 

•Colorectal cancer 

• Malignant neoplasm of the small intestine (152) 

• Crohn’s Disease 

• Volvulus 

• Intussusception 

•Cholelithiasis (574) 

•History of radiation therapy to abdomen

Considered but not recommended for further analysis 

Measure: Vasovagal reactions (G)

Reason for status: Vasovagal reaction was considered because it is a moderately severe 

condition that occurs somewhat frequently. It is not recommended because it is probably not 

preventable. Vasovagal reaction was considered to be somewhat severe (5 of 8 panelists rating it 

5 or higher) and somewhat preventable (4 of 9 panelists rating it 5 or 7). It occurred within 30 

days in 232 of 90,890 patients (2.6 per 1000) with colonoscopies performed in the three sites 

combined (HOPD, ASC, and office). 

Time frame for analysis: Within 7 days

Patient characteristics for risk adjustment model: 

84 
•Age 

•Gender 

•Race/ethnicity 

•Medicaid eligible 

•Disability status 

•History of partial bowel obstruction 

•History of complete bowel obstruction 

•History of colorectal cancer 

• Inflammatory bowel disease 

•Melena 

•Diabetes 

•Hypertension 

•Dementia 

•Hyperlipidemia 

• Stroke 

•Rheumatoid arthritis 

• Systemic lupus erythematosus 

•Chronic renal failure 

•AIDS 

• Peripheral vascular disease 

•COPD 

•Leukemia 

•Lymphoma

Considered but not recommended for further analysis 

Measure: Dyspnea (F)

Reason for status: Dyspnea was considered because it is somewhat severe and might be 

moderately preventable and occurs frequently. It is not recommended because it might be 

related to underlying comorbidity that would be difficult to control for adequately. Dyspnea was 

considered to be somewhat severe (6 of 8 panelists rating it 4, 5, or 7), and moderately 

preventable (6 of 9 panelists rating it 6, 7, or 9). It occurred within 30 days in 916 of 90,890 

patients (10.1 per 1000) with colonoscopies performed in the three sites combined (HOPD, ASC, 

and office). 

Time frame for analysis: Within 7 days

Patient characteristics for risk adjustment model: 

•Age 

•Gender 

•Race/ethnicity 

•Medicaid eligible 

•Disability status 

• Personal history of allergy to anesthetic agent 

• Personal history of allergy to narcotic agent 

• Personal history of allergy to analgesic agent 

•History of shock due to anesthesia in which correct substance was properly 

85 
administered 

•Diabetes 

•Hypertension 

•Dementia 

•Hyperlipidemia 

• Stroke 

•Rheumatoid arthritis 

• Systemic lupus erythematosus 

•Chronic renal failure 

•AIDS 

• Peripheral vascular disease 

•COPD (490 through 496) 

•Obstructive sleep apnea (327.23) 

•Leukemia 

•Lymphoma

Considered but not recommended for further analysis 

Measure: Arrhythmia (C) 

Reason for status: Arrhythmia was considered because it might occur as a result of a lengthy 

and difficult colonoscopy that induces a temporary drop in blood pressure. It was rated as 

somewhat severe and occurs frequently. However, it is not recommended because the panel did 

not consider it to be preventable and because it might be related to underlying comorbidity that 

would be difficult to control for adequately. Arrhythmia was considered to be somewhat severe 

(4 of 8 panelists rating it 4, 5, or 6), but not preventable (7 of 9 panelists rating it 1, 2, or 3) by 

the panel. It occurred within 30 days in 253 of 90,890 patients (2.8 per 1000) with 

colonoscopies performed in the three sites combined (HOPD, ASC, and office). 

Time frame for analysis: Within 7 days

Patient characteristics for risk adjustment model: 

•Age 

•Gender 

•Race/ethnicity 

•Medicaid eligible 

•Disability status 

•Unstable angina and all other ischemic heart disease 

•Heart failure/cardiomyopathy 

•Myocardial infarction within 6 months 

•Mobitz Type 2 atrioventricular block 

•Anomalous atrioventricular excitation including accelerated, accessory ventricular preexcitation, Wolff-Parkinson-White syndrome 

• Paroxysmal Supraventricular Tachycardia 

• Paroxysmal Ventricular Tachycardia 

• Patient with Automatic Implanted Cardioverter Defibrillator (AICD) 

•Atrial fibrillation 

•Atrial flutter in past 6 months 

86 
• Persistent severe sinus bradycardia or sick sinus tachycardia-bradycardia syndrome 

•Diabetes 

•Hypertension 

•Dementia 

•Hyperlipidemia 

• Stroke 

•Rheumatoid arthritis 

• Systemic lupus erythematosus 

•Chronic renal failure 

•AIDS 

• Peripheral vascular disease 

•COPD 

•Leukemia 

•Lymphoma 

Considered but not recommended for further analysis 

Measure: Chest pain (D) 

Reason for status: Chest pain was considered for further analysis because it might occur as a 

result of a lengthy and difficult colonoscopy that induces a temporary drop in blood pressure. It 

was rated as a severe condition and occurs frequently. However, it is not recommended because 

the panel did not consider it to be preventable and because it might be related to underlying 

comorbidity that would be difficult to control for adequately. Chest pain was considered to be 

moderately severe (5 of 7 panelists rating it 5, 6, or 8), and somewhat preventable (5 of 9 

panelists rating it 4, 5, or 6). It occurred within 30 days in 1346 of 90,890 patients (14.8 per 

1000) with colonoscopies performed in the three sites combined (HOPD, ASC, and office). 

Time frame for analysis: Within 7 days

Patient characteristics for risk adjustment model: 

•Age 

•Gender 

•Race/ethnicity 

•Medicaid eligible 

•Disability status 

•Diabetes 

• Ischemic heart disease 

•Heart failure/cardiomyopathy 

• Stroke (433, 434, 435) 

•Hypertension 

•Dementia 

•Hyperlipidemia 

•Rheumatoid arthritis 

• Fibromyalgia 

• Sickle cell disease_ 

• Systemic lupus erythematosus 

•Chronic renal failure 

87 
•AIDS 

• Peripheral vascular disease 

•COPD (490 through 496) 

• GERD (530.81, 530.11) 

•Leukemia 

•Lymphoma 

•Trauma to chest wall or prior chest wall pain (922, 959.11) 

• Herpes zoster/postherpetic neuralgia 

• Thoracic or abdominal aortic aneurysm 

•Aortic stenosis 

• Pericarditis 

• Sarcoidosis 

• Pulmonary blebs 

• Pleurisy (511) 

• Depression 

•Anxiety 

Considered but not recommended for further analysis 

Measure: Altered mental status (B) 

Reason for status: Altered mental status was considered because it might occur as a side effect 

of the sedative used during a colonoscopy. It was rated as somewhat severe and probably could 

be avoided. It is not recommended because it occurs infrequently and because it might be 

related to underlying comorbidity that would be difficult to control for adequately. Altered 

mental status was considered to be somewhat severe (4 of 8 panelists rating it 3, 4, or 5), and 

moderately preventable (7 of 9 panelists rating it 5, 6, 8, or 9). However, this outcome occurred 

infrequently within 30 days with only 34 cases among 90,890 patients (0.4 per 1000) with 

colonoscopies performed in the three sites combined (HOPD, ASC, and office). 

Time frame for analysis: Within 7 days

Patient characteristics for risk adjustment model: 

•Age 

•Gender 

•Race/ethnicity 

•Medicaid eligible 

•Disability status 

•Cirrhosis 

•Barbiturate, chlordiazepoxide, diazepam, glutethimide, meprobamate, or methaqualone 

dependence 

•Opioid type dependence 

•Diabetes 

•Hypertension 

•Dementia 

•Hyperlipidemia 

• Stroke 

•Rheumatoid arthritis 

88 
• Systemic lupus erythematosus 

•Chronic renal failure 

•AIDS 

• Peripheral vascular disease 

•COPD 

•Leukemia 

•Lymphoma 

Considered but not recommended for further analysis 

Measure: Death (E) 

Reason for status: Death was considered on the basis of the extreme severity of the outcome, 

but is not recommended because of its low frequency and an inability to control adequately for 

all possible comorbidities. It occurred infrequently with only 1 death within 30 days among 

90,890 patients with colonoscopies performed in the three sites combined (HOPD, ASC, and 

office). 

Time frame for analysis: Within 7 days

Patient characteristics for risk adjustment model: 

•Age 

•Gender 

•Race/ethnicity 

•Medicaid eligible 

•Disability status 

•Diabetes 

•Hypertension 

•Dementia 

•Hyperlipidemia 

• Stroke 

•Rheumatoid arthritis 

• Systemic lupus erythematosus 

•Chronic renal failure 

•AIDS 

• Peripheral vascular disease 

•COPD 

•Leukemia 

•Lymphoma 

89 
Proposed Outcome Measures for MRI (Brain) 

Magnetic resonance imaging of the head, neck and brain (MRI (brain)) is generally considered to 

be a non-invasive procedure used for diagnostic purposes. Cranial and spinal MRI may be 

performed with or without contrast agents. Contrast agents are used to help providers to detect 

and characterize lesions. In general, performing MRI (brain) is associated with few adverse 

outcomes. Certain subgroups of patients are at higher risk of complications, including those with 

certain types of cardiac pacemakers, metallic vascular aneurysm clips, ferromagnetic devices, 

and metallic fragments in the orbit, as well as those with claustrophobia (Shugarman et al., 

2004). Because of safety concerns, MRI (brain) is contraindicated for some patients with 

metallic foreign bodies or implants. In general, however, patients without contraindications 

undergo non-contrast MRI (brain) without experiencing adverse events. Patients undergoing 

contrast-enhanced MRI (brain) also have few adverse reactions. 

In selecting the recommended outcome measures for MRI (brain), we considered a list of 19 

outcome measures, including the initial set of 18 that were rated and discussed as part of the 

Phase 1 panel process, plus one outcome that was added after the Phase 1 panel meeting. We 

recommend that only one of these measures be analyzed further using risk adjustment. It is: 

• anaphylaxis/anaphylactoid reaction (B) 

We considered, but are not recommending, two other measures: 

•Chest pain (D) 

•Death (E) 

For each of these measures, we list the reasons for recommending or not recommending it, the 

time frame for analysis, and factors to be used in risk adjustment in the table below. The 

supporting evidence for the entire set of MRI (brain) outcomes is provided in Table 5 (in the 

attached Excel file). 

Of those outcomes not considered for further analysis, eight outcomes were dropped because 

they are indications for having an MRI (brain); these are altered mental status, dizziness, 

headache, ocular injury, paresthesia, seizure, syncope, and vasospasm. One additional outcome 

measure, vasodilatation, was eliminated because there are no ICD-9 codes that can be used to 

identify the condition in claims data. The remaining seven were not considered to be suitable 

outcomes for MRI (brain) (bradycardia, dyspnea, hypertension, hypotension, rash, tachycardia, 

and other complications). 

Recommended for further analysis 

Measure: Anaphylaxis/anaphylactoid reaction (B) 

Reason for status: Anaphylaxis/anaphylactoid reaction is a severe, life-threatening allergic 

reaction involving the entire body. It might result in difficulty breathing and, in rare cases, 

death. It would occur as a result of an allergic reaction of the patient to the contrast media used 

in some MRIs. It is included despite the fact that it occurs very infrequently and might not be 

preventable, because there are no other reasonable outcome measures for MRI (brain). This 

outcome was considered to be very severe (all 7 panelists rating it 7, 8, or 9). However, it 

occurred infrequently with only 11 cases within 30 days among 40,497 patients (0.3 per 1000) 

with MRI (brain) procedures performed in the three sites combined (HOPD, office, and IDTF). 

In addition, anaphylaxis was not considered to be preventable by the Phase 1 MRI panel, with 

only 2 of 7 panelists rating it 4 or higher.

Time frame for analysis: Within 7 days

90 
Patient characteristics for risk adjustment model: 

•Age 

•Gender 

•Race/ethnicity 

•Medicaid eligible 

•Disability status 

• Personal allergy to radiographic dye 

•History of anaphylactic shock 

• Personal history of allergy to anesthetic agent 

•History of shock due to anesthesia in which correct substance was properly 

administered 

Considered but not recommended for further analysis 

Measure: Chest pain (D) 

Reason for status: Chest pain was considered for further analysis because it might occur as a 

result of stress associated with the MRI procedure that might induce a temporary drop in blood 

pressure. It can indicate a severe underlying condition and occurs frequently. However, it is not 

recommended because the panel did not consider it to be preventable and because it might be 

related to underlying comorbidity that would be difficult to control for adequately. This 

outcome was considered to be somewhat severe (3 of 7 panelists rating it 4, 5, or 7). It occurred 

within 30 days in 1,133 of 40,497 patients (28.0 per 1000) with MRI (brain) procedures 

performed in the three sites combined (HOPD, office, and IDTF). However, chest pain was not 

considered to be preventable by any of the six Phase 1 MRI panelists, with none of them rating it 

higher than 2.

Time frame for analysis: Within 7 days

Patient characteristics for risk adjustment model: 

•Age 

•Gender 

•Race/ethnicity 

•Medicaid eligible 

•Disability status 

•Diabetes 

• Ischemic heart disease 

•Heart failure/cardiomyopathy 

• Stroke (433, 434, 435) 

•Hypertension 

•Dementia 

•Hyperlipidemia 

•Rheumatoid arthritis 

• Fibromyalgia 

• Sickle cell disease 

• Systemic lupus erythematosus 

•Chronic renal failure 

•AIDS 

• Peripheral vascular disease 

91 
•COPD (490 through 496) 

• GERD (530.81, 530.11) 

•Leukemia 

•Lymphoma 

•Trauma to chest wall or prior chest wall pain (922, 959.11) 

• Herpes zoster/postherpetic neuralgia 

• Thoracic or abdominal aortic aneurysm 

•Aortic stenosis 

• Pericarditis 

• Sarcoidosis 

• Pulmonary blebs 

• Pleurisy (511) 

• Depression 

•Anxiety 

Considered but not recommended for further analysis 

Measure: Death (E) 

Reason for status: Death was considered because of the extreme severity of the outcome, but 

not recommended mainly because of its low frequency and an inability to control adequately for 

all possible comorbidities. Only 2 deaths occurred within 30 days among 40,497 patients with 

MRI (brain) procedures performed in the three sites combined (HOPD, office, and IDTF). In 

addition, death was considered to be only somewhat preventable by the Phase 1 MRI panelists, 

with only 4 of 6 panelists rating it 5, 6, or 7.

Time frame for analysis: Within 7 days

Patient characteristics for risk adjustment model: 

•Age 

•Gender 

•Race/ethnicity 

•Medicaid eligible 

•Disability status 

•AIDS 

•Myocardial infarction 

•Heart failure 

• Peripheral vascular disease 

•Cirrhosis 

•Chronic kidney failure 

•Diabetes 

•Hypertension 

•Hyperlipidemia 

•Arrhythmia 

•Leukemia 

•Lymphoma 

92 
93

Table F.3 Cataract Surgery Summary Based on Panel Ratings and Claims Analysis 

Preventability* (shaded are those with at 

least 3 ratings >6)

Severity** (shaded are those with at least 3 

ratings >6)

Cataract Surgery Outcomes 

# 

Resp 1 2 3 4 5 6 7 8 9 

# 

Resp 1 2 3 4 5 6 7 8 9 

A Arrhythmia 6 0 1 3 1 0 0 1 0 0 6 0 0 1 1 4 0 0 0 0 B Capsule rupture or posterior capsule tear 6 0 0 1 0 2 1 2 0 0 6 0 0 1 3 1 0 1 0 0 

C New or Worsening Congestive heart failure 6 0 1 1 0 0 2 2 0 0 6 0 0 0 0 1 0 3 2 0 D Persistent cystoid macular edema 5 0 0 0 0 3 0 2 0 0 5 0 0 0 0 2 2 0 1 0 

E Death 6 0 0 0 1 2 1 1 1 0 6 0 0 0 0 0 0 0 0 6 

F Endophthalmitis 5 0 0 0 0 2 0 3 0 0 6 0 0 0 0 0 0 0 3 3 

G Hypertension 6 0 0 0 0 1 4 0 1 0 6 0 0 2 2 0 1 0 1 0 

H Hypotension 6 0 0 0 1 3 0 1 1 0 6 0 0 0 1 4 1 0 0 0 

I Iris prolapse 6 0 0 0 0 0 1 0 5 0 6 0 0 0 2 2 0 2 0 0 

J Myocardial infarction 6 0 0 2 2 0 1 1 0 0 6 0 0 0 0 0 0 1 1 4 

K Retained nuclear fragment (posterior chamber 

vs. anterior chamber) 

6 0 0 0 1 0 1 0 4 0 6 0 0 0 0 3 3 0 0 0 

L Ocular hypertension 6 0 0 0 0 1 4 0 1 0 6 0 0 1 3 1 1 0 0 0 

M Persistent iridocyclitis 6 0 0 0 0 2 2 2 0 0 6 0 0 0 0 2 3 1 0 0 

N Poor ocular motility, excluding cranial VII palsy 6 0 0 0 0 1 3 1 1 0 5 0 0 0 1 3 1 0 0 0 

O Retinal break 6 0 1 1 1 1 2 0 0 0 7 0 0 1 0 0 2 3 1 0 

P Retinal detachment (comp vs uncomp surgery) 6 0 0 2 1 1 2 0 0 0 7 0 0 0 0 0 0 2 5 0 

Q Stroke 6 0 1 2 0 1 1 1 0 0 7 0 0 0 0 0 0 0 5 2 

R Wound dehiscence 7 0 0 1 0 0 3 2 1 0 7 0 0 0 0 0 1 4 2 0 

S Wound leak 7 0 0 0 0 0 1 1 5 0 6 0 0 0 0 1 2 3 0 0 

T Aspiration pneumonia 5 0 2 0 0 0 0 2 1 0 6 0 0 0 0 0 0 4 2 0 

U Respiratory Failure From Surgery 5 0 1 1 0 2 0 0 1 0 6 0 0 0 0 1 0 1 4 0 

V Hyphema 6 0 0 0 0 0 3 2 1 0 6 0 0 0 2 2 2 0 0 0 

W Persistent Corneal Edema 6 0 0 0 0 1 0 4 1 0 6 0 0 0 0 1 0 5 0 0 

X Vitreous Loss 6 0 0 1 0 0 2 3 0 0 6 0 0 0 1 2 1 2 0 0 

Y Secondary Glaucoma 6 0 0 0 0 3 1 2 0 0 5 0 0 0 0 2 3 0 0 0 

Z Dislocated Ocular Lenses 6 0 0 0 0 1 0 2 3 0 6 0 0 0 0 3 1 2 0 0 

AA Iris/pupil deformation 6 0 0 0 0 1 0 3 2 0 6 0 0 1 1 3 1 0 0 0 BB Nausea and vomiting 

CC Cataract fragments in eye *The preventability scale is defined as follows: 1=Not preventable; 9=Definitely preventable. **The severity scale is defined as follows: 1=Not severe, 5=Somewhat severe, 9=Very severe. 
94
Table F.4 Colonoscopy Summary Based on Panel Ratings and Claims Analysis 

Preventability* (shaded rows are those with 

at least 4 ratings >6)

Severity** (shaded rows are those with at 

least 4 ratings >6) N 

Colonoscopy 

Outcomes 

# 

Resp 1 2 3 4 5 6 7 8 9 

# 

Resp 1 2 3 4 5 6 7 8 9 

(shaded = 

>2 pe

A Abdominal pain 9 0 0 0 0 6 3 0 0 0 7 0 5 2 0 0 0 0 0 0 3678 B Altered mental 

status 9 0 0 1 1 2 2 0 2 1 8 1 3 2 1 1 0 0 0 0 34 

C Arrhythmia 9 2 3 2 1 1 0 0 0 0 8 0 2 2 1 2 1 0 0 0 253 D Chest pain 9 1 2 1 1 3 1 0 0 0 7 0 0 2 0 1 3 0 1 0 1346 

E Death 9 0 1 0 1 0 0 1 3 3 8 0 0 0 0 0 0 0 0 8 1 

F Dyspnea 9 0 2 1 0 0 1 4 0 1 8 0 0 2 3 1 0 2 0 0 916 

G Hemorrhage 9 0 2 0 0 3 0 4 0 0 8 0 0 0 0 3 1 3 1 0 1873 

H Hypertension 9 0 1 0 1 2 3 2 0 0 8 0 2 3 1 0 0 1 1 0 2 

I Hypotension 9 0 2 2 1 2 0 2 0 0 8 0 0 1 1 1 1 2 2 0 106 

J Hypoxia 9 0 1 3 0 1 1 0 3 0 8 0 0 0 0 1 0 4 2 1 4 

K Perforation 9 0 3 0 0 2 0 0 4 0 8 0 0 0 0 0 1 0 2 5 73 

L Post-polypectomy 

syndrome 9 0 3 0 0 3 2 0 1 0 8 0 0 0 0 1 2 2 3 0 No codes 

A Abdominal 

distension 9 0 0 1 0 4 3 1 0 0 8 0 0 2 4 1 0 0 1 0 151 

B Endocarditis 9 0 2 0 0 1 2 3 0 1 8 0 0 0 0 0 0 0 4 3 10 

C Sepsis and other 

infections 9 0 2 0 0 0 2 4 1 0 7 0 0 0 0 0 1 2 4 0 154 

D Small bowel 

obstruction 9 1 5 2 0 1 0 0 0 0 8 0 0 0 0 0 3 2 2 1 528 

E Splenic rupture 9 0 3 0 0 2 0 1 3 0 7 0 0 0 0 0 0 0 2 5 35 

F Splenic trauma 9 0 3 0 0 2 0 1 3 0 7 0 0 0 0 0 0 0 4 3 0 

G Vasovagal 

reactions 9 1 2 1 1 3 0 1 0 0 8 0 0 0 3 2 1 0 1 1 232 

Other complications*** 116 

*The preventability scale is defined as follows: 1=Not preventable, 5=Somewhat preventable, 9=Definitely preventable. **The severity scale is defined as follows: 1=Not severe, 5=Somewhat severe, 9=Very severe. ***Other complications are diagnosis codes 998.89 (Other specified complications of procedures, not elsewhere classified), and 669.4 (NOS). 

95
Table F.5 MRI (Brain) Summary Based on Panel Ratings and Claims Analysis 

Preventability* (shaded rows are those 

with at least 1 rating >4)

Severity** (shaded rows are those with at 

least 1 rating >6) N 

MRI (Brain) Outcomes #Resp 1 2 3 4 5 6 7 8 9 #Resp 1 2 3 4 5 6 7 8 9 

(shaded 

of > 10 

A Altered mental status 7 3 2 2 0 0 0 0 0 0 7 2 3 1 0 0 1 0 0 0 65 B Anaphylaxis/anaphylactoid 

reaction 

7 3 1 1 1 1 0 0 0 0 7 0 0 0 0 0 0 1 4 2 

11 

C Bradycardia 7 5 0 2 0 0 0 0 0 0 7 3 2 2 0 0 0 0 0 0 277 D Chest pain 7 5 2 0 0 0 0 0 0 0 7 2 0 2 1 1 0 1 0 0 1133 

E Death 6 2 0 0 0 1 2 1 0 0 6 0 0 0 0 0 0 0 0 6 2 

F Dizziness 5 3 0 2 0 0 0 0 0 0 6 2 3 1 0 0 0 0 0 0 2151 

G Dyspnea 6 1 0 4 0 1 0 0 0 0 6 0 2 0 1 2 0 1 0 0 799 

H Headache 6 5 1 0 0 0 0 0 0 0 4 0 4 0 0 0 0 0 0 0 1512 

I Hypertension 6 2 2 2 0 0 0 0 0 0 6 1 1 2 1 1 0 0 0 0 4 

J Hypotension 6 2 2 1 0 1 0 0 0 0 6 1 0 1 1 1 2 0 0 0 152 

K Ocular injury 6 0 0 0 0 0 0 2 2 2 6 0 0 1 0 0 0 1 3 1 No code

L Paresthesia 7 4 1 2 0 0 0 0 0 0 7 4 2 1 0 0 0 0 0 0 521 

M Rash 7 2 1 2 1 1 0 0 0 0 7 2 2 3 0 0 0 0 0 0 58 

N Seizure 6 5 1 0 0 0 0 0 0 0 7 0 0 1 1 2 0 1 1 1 904 

O Syncope 7 5 0 0 0 2 0 0 0 0 7 1 3 0 1 1 0 0 0 1 877 

P Tachycardia 7 3 1 2 0 1 0 0 0 0 7 2 0 2 1 2 0 0 0 0 53 

Q Vasodilatation 7 6 0 0 0 1 0 0 0 0 7 2 1 3 0 1 0 0 0 0 No code

R Vasospasm 7 5 0 1 0 1 0 0 0 0 7 1 1 3 0 2 0 0 0 0 No code

Other complications*** 18 

*The preventability scale is defined as follows: 1=Not preventable, 5=Somewhat preventable, 9=Definitely preventable. **The severity scale is defined as follows: 1=Not severe, 5=Somewhat severe, 9=Very severe. ***Other complications are diagnosis codes 998.89 (Other specified complications of procedures, not elsewhere classified), and 998.9 (

of procedures). 

96
97

Table F.6 Recommended Measures with Panel Ratings and Frequency 

Preventability* Severity** Fre

Outcome #Resp 1 2 3 4 5 6 7 8 9 #Resp 1 2 3 4 5 6 7 8 9 N 

Cataract surgery (shaded are those with at least 3 ratings >6) (shaded are those with at least 3 ratings >6) (shade

of > 

F Endophthalmitis 5 0 0 0 0 2 0 3 0 0 6 0 0 0 0 0 0 0 3 3 113 

CC Cataract fragments in eye 92 

W Persistent corneal edema 6 0 0 0 0 1 0 4 1 0 6 0 0 0 0 1 0 5 0 0 54 

I Iris prolapse 6 0 0 0 0 0 1 0 5 0 6 0 0 0 2 2 0 2 0 0 62 

Colonoscopy (shaded rows are those with at least 4 ratings >6) (shaded rows are those with at least 4 ratings >6) (shade

of >2 

K Perforation 9 0 3 0 0 2 0 0 4 0 8 0 0 0 0 0 1 0 2 5 73 E Splenic rupture 9 0 3 0 0 2 0 1 3 0 7 0 0 0 0 0 0 0 2 5 35 

MRI (Brain) (shaded rows are those with at least 1 rating >4) (shaded rows are those with at least 1 rating >6) (shade

of > 1

B Anaphylaxis/anaphylactoid reaction 7 3 1 1 1 1 0 0 0 0 7 0 0 0 0 0 0 1 4 2 11 

*The preventability scale is defined as follows: 1=Not preventable, 5=Somewhat preventable, 9=Definitely preventable. **The severity scale is defined as follows: 1=Not severe, 5=Somewhat severe, 9=Very severe. ***Within 30 days of the procedure. 

Appendix G. Cataract Surgery: Covariates and Parameter 

Estimates for Logistic Regression Models 

Table G.1 Cataract Surgery Covariates Used in Logistic Regression Models By Setting, Medicare Fee-forService, 2001 

OPD ASC All Sites 

 Number Percent Number Percent Number Percent 

All cataract surgeries 36623 100.0 40671 100.0 77294 100.0 

Under 65 years 1256 3.4 1159 2.9 2415 3.1 

65-74 years 13482 36.8 15988 39.3 29470 38.1 

75-84 years 17655 48.2 19488 47.9 37143 48.1 

85 years and over 4229 11.5 4030 9.9 8259 10.7 

Female 23784 64.9 25461 62.6 49245 63.7 

White 32698 89.3 37228 91.5 69926 90.5 

African-American 2534 6.9 1954 4.8 4488 5.8 

Other race 1390 3.8 1483 3.6 2873 3.7 

Medicaid eligible 4966 13.6 4321 10.6 9287 12.0 

Originally disabled 3701 10.1 3641 9.0 7342 9.5 

Diabetes mellitus 10463 28.6 10421 25.6 20884 27.0 

Rheumatoid arthritis/ 

Systemic lupus 

erythematosus 

2132 5.8 2183 5.4 4315 5.6 

Metastatic cancer/Leukemia/ 

Lymphoma 653 1.8 691 1.7 1344 1.7 

History of vitrectomy 140 0.4 176 0.4 316 0.4 

Essential, benign, or drugrelated tremor/Abnormal 

head movements, 

fasciculations, spasms or 

tremor not otherwise 

specified 

208 0.6 156 0.4 364 0.5 

Source: RAND analysis of the 5 percent Standard Analytical Files of Medicare claims, 2001. 

99 
100 
 

Appendix H. Perforation: Covariates and Parameter 

Estimates for Logistic Regression Models 

Table H.1 Perforation Covariates Used in Logistic Regression Models By Ambulatory Setting, Medicare Fee-for-Service, 

2001 

OPD ASC Office All Sites 

Number Percent Number Percent Number Percent Number Percent

All colonoscopies 63372 100.0 23503 100.0 4015 100.0 90890 100.0

Under 65 years 5567 8.8 1591 6.8 323 8.0 7481 8.2

65-74 years 32061 50.6 12571 53.5 2176 54.2 46808 51.5

75-84 years 22165 35.0 8208 34.9 1335 33.3 31708 34.9

85 years and over 3568 5.6 1131 4.8 181 4.5 4880 5.4

Female 35703 56.3 13260 56.4 2206 54.9 51169 56.3

White 56980 89.9 21313 90.7 3433 85.5 81726 89.9

African-American 4480 7.1 1453 6.2 301 7.5 6234 6.9

Other race 1901 3.0 735 3.1 281 7.0 2917 3.2

Medicaid eligible 7222 11.4 1965 8.4 333 8.3 9520 10.5

Originally disabled 9540 15.1 2782 11.8 574 14.3 12896 14.2

History of partial or complete 

bowel obstruction 2246 3.5 669 2.8 124 3.1 3039 3.3

History of colorectal cancer 1587 2.5 316 1.3 154 3.8 2057 2.3

Inflammatory bowel disease 1128 1.8 379 1.6 103 2.6 1610 1.8

Melena 1553 2.5 275 1.2 229 5.7 2057 2.3

Source: RAND analysis of the 5 percent Standard Analytical Files of Medicare claims, 2001. 

101 
Table H.2 Parameters from Logistic Regression for Perforation within 30 Days of 

RBC Colonoscopies, Medicare Fee-for-Service, 2001 

Variable 

Parameter 

Estimate 

Standard Error 

p Value 

Intercept -7.505 0.312 <.0001§

age_under_65 -0.474 0.817 0.5618 

age_75_84 0.327 0.308 0.2872 

age_85p -0.208 0.742 0.7797 

female 0.053 0.296 0.8586 

race_afam -0.182 0.615 0.7666 

race_other -0.179 0.758 0.8136 

disabled -0.140 0.603 0.8166 

medicaid 1.102 0.411 0.0074§

bowel_obstruct 0.819 0.534 0.1253 

colorectal_cancer 1.049 0.609 0.0852 

inflam_bowel_disease 0.556 0.727 0.4443 

melena 0.757 0.727 0.2977 

inasc 0.715 0.296 0.0156§

inoff -12.452 403.600 0.9754 

§

 Parameters in bold are significant at p<0.05. 

Table H.3 Parameters from Logistic Regression for Perforation within 30 

Days of Non-RBC Colonoscopies, Medicare Fee-for-Service, 2001 

Variable* 

Parameter 

Estimate 

Standard 

Error p Value 

Intercept -7.560 0.358 <.0001§

age_under_65 -1.233 0.848 0.1460 

age_75_84 0.012 0.352 0.9723 

age_85p 0.794 0.507 0.1172 

female -0.039 0.324 0.9045 

race_afam 0.211 0.545 0.6988 

disabled 0.649 0.499 0.1933 

medicaid 0.350 0.483 0.4693 

bowel_obstruct 1.449 0.456 0.0015§

colorectal_cancer 0.495 0.743 0.5050 

inflam_bowel_disease 0.846 1.020 0.4068 

melena 0.745 0.733 0.3096 

inasc 0.894 0.329 0.0066§

inoff 0.663 0.621 0.2853 

*A variable representing “other race” was dropped from the model based on 

initial results indicating the coefficient was insignificant and unstable because of 

small numbers. 

§

 Parameters in bold are significant at p<0.05. 

102 
Appendix I. Anaphylaxis: Covariates and Parameter 

Estimates for Logistic Regression Models for Comparison 

of Three Settings 

Table I.1 Anaphylaxis Covariates for Three Ambulatory Settings Used in Logistic Regression Models, 

Medicare Fee-for-Service, 2001 

OPD Office IDTF All Sites 

Number Percent Number Percent Number Percent Number Percent

All MRI (brain) 21233 100.0 14712 100.0 4552 100.0 40497 100.0

Under 65 years 3181 15.0 1697 11.5 641 14.1 5519 13.6

65-74 years 8545 40.2 6027 41.0 1834 40.3 16406 40.5

75-84 years 7760 36.6 5821 39.6 1718 37.7 15299 37.8

85 years and over 1745 8.2 1167 7.9 359 7.9 3271 8.1

Female 12891 60.7 9043 61.5 2875 63.2 24809 61.3

White 19009 89.5 13304 90.4 4116 90.4 36429 90.0

African-American 1510 7.1 826 5.6 211 4.6 2547 6.3

Other race 712 3.4 582 4.0 225 4.9 1519 3.8

Medicaid eligible 3450 16.2 1770 12.0 795 17.5 6015 14.9

Originally disabled 4599 21.7 2582 17.6 951 20.9 8132 20.1

History of anaphylactic shock 131 0.6 239 1.6 20 0.4 390 1.0

Source: RAND analysis of the 5 percent Standard Analytical Files of Medicare claims, 2001. 

Table I.2 Parameters from Logistic Regression for 

Anaphylaxis within 7 Days of MRIs (Brain) with Contrast 

for Three Settings, Medicare Fee-for-Service, 2001 

Variable* 

Parameter 

Estimate 

Standard 

Error p 

Value 

Intercept -26.539 198.000 0.8934 

age_under_65 -5.784 185.900 0.9752 

age_75p -10.338 148.500 0.9445 

female 8.965 146.600 0.9512 

race_afam -9.863 297.700 0.9736 

disabled -9.473 168.300 0.9551 

medicaid 12.194 133.100 0.9270 

inidtf -9.978 272.500 0.9708 

inoff -9.553 160.200 0.9525 

*Four variables representing age over 85 years, “other race,” 

personal allergy to radiographic dye, and history of 

anaphylactic shock were dropped from the model based on 

initial results indicating the coefficients were insignificant 

and unstable because of small numbers. 

103 
Table I.3 Parameters from Logistic Regression for 

Anaphylaxis within 7 Days of MRIs (Brain) without 

Contrast for Three Settings, Medicare Fee-for-Service, 2001 

Variable* 

Parameter 

Estimate 

Standard 

Error p 

Value 

Intercept -36.375 224.600 0.8713 

age_under_65 -1.473 1.428 0.3024 

age_75_84 -9.245 186.900 0.9606 

age_85p -9.266 386.900 0.9809 

female -0.837 1.423 0.5565 

disabled 10.598 136.000 0.9379 

medicaid 11.198 133.100 0.9330 

history_anaph_shock -9.758 890.200 0.9913 

inidtf 10.767 119.300 0.9281 

inoff 10.145 119.300 0.9322 

*Three variables representing African-American, “other 

race,” and personal allergy to radiographic dye were dropped 

based on initial results indicating the coefficients were 

insignificant and unstable because of small numbers. 

Table I.4 Parameters from Logistic Regression for Anaphylaxis 

within 30 Days of All MRIs (Brain) for Three Settings, Medicare 

Fee-for-Service, 2001 

Variable* 

Parameter 

Estimate 

Standard 

Error p Value 

Intercept -8.791 0.771 <.0001§

age_under_65 -0.709 0.939 0.4501 

age_75_84 -0.712 0.849 0.4017 

age_85p 0.169 1.113 0.8795 

female 0.460 0.684 0.5008 

race_afam -0.090 1.078 0.9338 

disabled 1.132 0.859 0.1875 

medicaid 0.766 0.729 0.2936 

history_anaph_shock 2.401 1.066 0.0244§

inidtf 0.451 0.819 0.5818 

inoff -0.314 0.715 0.6602 

*Two variables representing “other race” and personal allergy to 

radiographic dye were dropped from the model based on initial 

results indicating the coefficients were insignificant and unstable 

because of small numbers. 

§

 Parameters in bold are significant at p<0.05. 

104 
Table I.5 Parameters from Logistic Regression for Anaphylaxis 

within 30 Days of MRIs (Brain) with Contrast for Three Settings, 

Medicare Fee-for-Service, 2001 

Variable* 

Parameter 

Estimate 

Standard 

Error p Value 

Intercept -8.102 0.859 <.0001§

age_under_65 -0.525 1.245 0.6736 

age_75p -1.348 1.129 0.2324 

female 0.499 0.843 0.5534 

race_afam 0.539 1.115 0.6290 

disabled 0.745 1.139 0.5130 

medicaid 0.310 0.960 0.7467 

inidtf 0.129 1.098 0.9064 

inoff -1.012 1.097 0.3562 

*Four variables representing age over 85 years, “other race,” 

personal allergy to radiographic dye, and history of anaphylactic 

shock were dropped from the model based on initial results 

indicating the coefficients were insignificant and unstable because of 

small numbers. 

§

 Parameters in bold are significant at p<0.05. 

Table I.6 Parameters from Logistic Regression for Anaphylaxis 

within 30 Days of MRIs (Brain) without Contrast for Three 

Settings, Medicare Fee-for-Service, 2001 

Variable* 

Parameter 

Estimate 

Standard 

Error p Value 

Intercept -10.845 1.748 <.0001§

age_under_65 -0.849 1.600 0.5958 

age_75_84 0.216 1.446 0.8814 

age_85p 1.807 1.477 0.2210 

female 0.453 1.175 0.6998 

disabled 1.762 1.354 0.1933 

medicaid 1.517 1.180 0.1986 

history_anaph_shock 3.702 1.235 0.0027§

inidtf 1.288 1.422 0.3651 

inoff 0.777 1.254 0.5357 

*Three variables representing African-American, “other race,” and 

personal allergy to radiographic dye were dropped from the model 

based on initial results indicating the coefficients were insignificant 

and unstable because of small numbers. 

§

 Parameters in bold are significant at p<0.05. 

105 
Table I.7 Parameters from Logistic Regression for 

Anaphylaxis within 7 Days of All MRIs (Brain) for Two 

Settings, Medicare Fee-for-Service, 2001 

Variable* 

Parameter 

Estimate 

Standard 

Error 

p 

Value 

Intercept -19.276 151.2 0.8985 

age_under_65 -1.717 1.4 0.2245 

age_75p -10.792 196.4 0.9562 

age_85p -10.854 422.4 0.9795 

female -0.201 1.2 0.8704 

race_afam -10.928 319.8 0.9727 

disabled 0.903 1.4 0.5227 

medicaid 12.937 151.2 0.9318 

history_anaph_shock -9.794 996.3 0.9922 

inopd -0.935 1.2 0.4460 

*Two variables representing “other race” and personal allergy 

to radiographic dye were dropped from the model based on 

initial results indicating the coefficients were insignificant 

and unstable because of small numbers. 

Table I.8 Parameters from Logistic Regression for 

Anaphylaxis within 7 Days of MRIs (Brain) with Contrast for 

Two Settings, Medicare Fee-for-Service, 2001 

Variable* 

Parameter 

Estimate 

Standard 

Error p 

Value 

Intercept -35.866 227.6 0.8748 

age_under_65 -5.742 181.9 0.9748 

age_75p -10.273 143.7 0.9430 

female 8.854 138.7 0.9491 

race_afam -9.887 301.3 0.9738 

disabled -9.431 164.7 0.9543 

medicaid 12.073 125.3 0.9232 

inopd 9.560 130.0 0.9414 

*Four variables representing age over 85 years, “other race,” 

personal allergy to radiographic dye, and history of 

anaphylactic shock were dropped from the model based on 

initial results indicating the coefficients were insignificant 

and unstable because of small numbers. 

106 
Table I.9 Parameters from Logistic Regression for 

Anaphylaxis within 7 Days of MRIs (Brain) without 

Contrast for Two Settings, Medicare Fee-for-Service, 2001 

Variable* 

Parameter 

Estimate 

Standard 

Error p 

Value 

Intercept -24.487 128.3 0.8486 

age_under_65 -1.424 1.4 0.3165 

age_75_84 -8.480 123.0 0.9450 

age_85p -8.162 253.9 0.9744 

female -0.825 1.4 0.5618 

disabled 9.826 91.9 0.9148 

medicaid 10.460 89.6 0.9070 

history_anaph_shock -8.848 552.9 0.9872 

inopd -9.591 79.1 0.9035 

*Three variables representing African-American, “other 

race,” and personal allergy to radiographic dye were dropped 

based on initial results indicating the coefficients were 

insignificant and unstable because of small numbers. 

Table I.10 Parameters from Logistic Regression for Anaphylaxis 

within 30 Days of All MRIs (Brain) for Two Settings, Medicare Feefor-Service, 2001 

Variable* 

Parameter 

Estimate 

Standard 

Error p Value 

Intercept -8.864 0.788 <.0001§

age_under_65 -0.703 0.939 0.4540 

age_75_84 -0.715 0.848 0.3993 

age_85p 0.168 1.113 0.8797 

female 0.461 0.684 0.5007 

race_afam -0.119 1.077 0.9119 

disabled 1.135 0.859 0.1865 

medicaid 0.801 0.729 0.2721 

history_anaph_shock 2.307 1.060 0.0294§

inopd 0.067 0.610 0.9126 

*Two variables representing “other race” and personal allergy to 

radiographic dye were dropped from the model based on initial 

results indicating the coefficients were insignificant and unstable 

because of small numbers. 

§

 Parameters in bold are significant at p<0.05. 

107 
Table I.11 Parameters from Logistic Regression for Anaphylaxis 

within 30 Days of MRIs (Brain) with Contrast for Two Settings, 

Medicare Fee-for-Service, 2001 

Variable* 

Parameter 

Estimate 

Standard 

Error p Value 

Intercept -8.7042 1.011 <.0001§

age_under_65 -0.5245 1.245 0.6734 

age_75p -1.3459 1.129 0.2330 

female 0.5001 0.842 0.5527 

race_afam 0.5231 1.116 0.6391 

disabled 0.7478 1.140 0.5117 

medicaid 0.3302 0.962 0.7314 

inopd 0.5962 0.839 0.4773 

*Four variables representing age over 85 years, “other race,” 

personal allergy to radiographic dye, and history of anaphylactic 

shock were dropped from the model based on initial results 

indicating the coefficients were insignificant and unstable because of 

small numbers. 

§

 Parameters in bold are significant at p<0.05. 

Table I.12 Parameters from Logistic Regression for Anaphylaxis 

within 30 Days of MRIs (Brain) without Contrast for Two Settings, 

Medicare Fee-for-Service, 2001 

Variable* 

Parameter 

Estimate 

Standard 

Error p Value 

Intercept -9.920 1.532 <.0001§

age_under_65 -0.830 1.595 0.6030 

age_75_84 0.215 1.445 0.8819 

age_85p 1.822 1.482 0.2189 

female 0.438 1.172 0.7084 

disabled 1.777 1.355 0.1897 

medicaid 1.557 1.172 0.1838 

history_anaph_shock 3.606 1.204 0.0027§

inopd -0.936 1.168 0.4230 

*Three variables representing African-American, “other race,” and 

personal allergy to radiographic dye were dropped from the model 

based on initial results indicating the coefficients were insignificant 

and unstable because of small numbers. 

§

 Parameters in bold are significant at p<0.05. 

108 
Appendix J. Specifications for Computer Runs to Analyze 

Outcome Measures 

Please use SAS PROC LOGISTIC for the runs, specifying the DESCENDING option in your 

PROC statement (i.e., PROC LOGISTIC DATA=________ DESCENDING;). 

The dependent and independent variables, including patient characteristics and setting dummies, 

samples, and exclusions are specified below. 

Cataract Surgery Outcomes 

For each of the four cataract surgery outcomes, you’ll run two logistic regression models: 

Model 1: covariates are patient characteristics/comorbidities only 

Model 2: covariates are patient characteristics/comorbidities and setting dummy 

For the cataract surgery outcomes, you’ll run a total of 8 models (4 outcomes, 2 models). 

109 
Measure: Endophthalmitis (F) 

Set outcome indicator equal to 1 if these ICD codes are found on any record for any setting: 

360.00 Purulent endophthalmitis, unspecified 

360.01 Acute endophthalmitis 

For each cataract surgery patient, search all records in all files (OPD, physician/supplier, 

inpatient), excluding the index procedure file. Search all fields on records included in the 

search.

Time frame for outcome: Search for outcome within 30 days of procedure date

Patient characteristics for Models 1 and 2 (a variable in bold and parens below is the reference 

category, that should not be included in the model): 

Create dummy variables (0,1) for each of the following:

• Under 65 years at time of procedure 

• (65-74) 

• 75-84 

• 85+ 

• (Male) 

• Female 

• (White) 

• Afr-Amer 

• Other race 

• (Medicaid eligible) (if buy-in code for any month in 2001 equals “C”, then =1) 

• (not Medicaid eligible) 

• Originally disabled (if OREC = 1 or 3) 

• (not originally disabled) 

• Diabetes (if acc004 or hcc015 or hcc016 or hcc017 or hcc018 or hcc019 or hcc020 or 

hcc119 or hcc120=1 or if any ICD-9 diagnosis code on any claim in any setting 

during all 12 months of 2001 = 250 or 250.0x – 250.9x) 

• Rheumatoid arthritis/ Systemic lupus erythematosus (if hcc038=1 or if any ICD-9 

diagnosis code on any claim in any setting during all 12 months of 2001 = 714, 714.0 

– 714.3x, 695.4, or 710.0) 

• Metastatic cancer/Leukemia/Lymphoma (if hcc007=1 or if any ICD-9 diagnosis code 

on any claim in any setting during all 12 months of 2001 = 201, 201.xx, 202, 202.xx, 

204, 204.xx, 205, 205.xx, 206, 206.xx, 207, 207.xx, 208, 208.xx 

Dummy variables for setting: 

Model 1: none included 

Model 2: ASC 

Sample: all cataract surgeries performed in the OPD or in an ASC

Exclusions: 

• beneficiaries not enrolled in Part A and Part B 

• any procedures performed in an office setting 

• any other exclusion used in Phase 1 for the cataract surgery outcome table. 

Missing values: exclude records with a missing for any covariate in the model 

NOTE: please set the outcome indicator to zero for selected cases with 2 or 3 procedures per my 

1/4/06 e-mail. 

110 
Measure: Cataract fragments in eye (CC) 

Set outcome indicator equal to 1 if this ICD-9 code is found on any record for any setting: 

998.82 Cataract fragments in eye following cataract surgery 

For each cataract surgery patient, search all records in all files (OPD, physician/supplier, 

inpatient), excluding the index procedure file. Search all fields on records included in the 

search. 

Time frame for analysis: Search for outcome within 30 days of procedure date

Patient characteristics for risk adjustment model: 

•Under 65 years at time of procedure 

• (65-74) 

• 75-84 

• 85+ 

• (Male) 

• Female 

• (White) 

•Afr-Amer 

•Other race 

• (Medicaid eligible) (if buy-in code for any month in 2001 equals “C”, then =1) 

• (not Medicaid eligible) 

•Originally disabled (if OREC = 1 or 3) 

• (not originally disabled) 

•History of vitrectomy (if any HCPCS/CPT code on any claim in any setting before the 

procedure date during 2001 = 67005, 67036, 67108 (NOTE: code added since Phase 

1), 67010, 67040, 67038, 67039 

•Essential, benign, or drug-related tremor/Abnormal head movements, fasciculations, 

spasms or tremor not otherwise specified (if any diagnosis code on any claim in any 

setting during all 12 months of 2001 = 781.0 or 333.1. Please check all 2001 claims, 

both before and after the procedure date.) 

Dummy variables for setting: 

Model 1: none included 

Model 2: ASC 

Sample: all cataract surgeries performed in the OPD or in an ASC

Exclusions: 

• beneficiaries not enrolled in Part A and Part B 

• any procedures performed in an office setting 

• any other exclusion used in Phase 1 for the cataract surgery outcome table. 

Missing values: exclude records with a missing for any covariate in the model 

NOTE: please set the outcome indicator to zero for selected cases with 2 or 3 procedures per my 

1/4/06 e-mail. 

111 
Measure: Persistent corneal edema (W) 

Set outcome indicator equal to 1 if this ICD code is found on any record for any setting: 

371.22 Secondary corneal edema 

For each cataract surgery patient, search all records in all files (OPD, physician/supplier, 

inpatient), excluding the index procedure file. Search all fields on records included in the 

search. 

In addition, set outcome indicator equal to 1 if any of these HCPCS/CPT procedure codes are 

found on any record for any outpatient setting: 

65710: Keratoplasty (corneal transplant); lamellar. 

65730: Keratoplasty (corneal transplant); penetrating (except in aphakia). 

65750: Keratoplasty (corneal transplant); penetrating (in aphakia). 

65755: Keratoplasty (corneal transplant); penetrating (in pseudophakia). 

Search all fields on records included in the search. 

In addition, set outcome indicator equal to 1 if any of these ICD-9-CM procedure codes are 

found on any record for the inpatient setting: 

11.60, 11.61, 11.62, 11.63, 11.64, 11.69: Keratoplasty (corneal transplant), all types. 

Search all fields on records included in the search. 

For each cataract surgery patient, search all records in all files (OPD, physician/supplier, 

inpatient), excluding the index procedure file. Search all fields on records included in the 

search. 

Time frame for analysis: Search for outcome within 30 days of procedure date 

Patient characteristics for risk adjustment model: 

•Under 65 years at time of procedure 

• (65-74) 

• 75-84 

• 85+ 

• (Male) 

• Female 

• (White) 

•Afr-Amer 

•Other race 

• (Medicaid eligible) (if buy-in code for any month in 2001 equals “C”, then =1) 

• (not Medicaid eligible) 

•Originally disabled (if OREC = 1 or 3) 

• (not originally disabled) 

•Diabetes (if acc004 or hcc015 or hcc016 or hcc017 or hcc018 or hcc019 or hcc020 or 

hcc119 or hcc120=1 or if any ICD-9 diagnosis code on any claim in any setting during all 

12 months of 2001 = 250 or 250.0 – 250.9) 

Dummy variables for setting: 

Model 1: none included 

Model 2: ASC 

Sample: all cataract surgeries performed in the OPD or in an ASC 

Exclusions: 

• beneficiaries not enrolled in Part A and Part B 

• any procedures performed in an office setting 

112 
• any other exclusion used in Phase 1 for the cataract surgery outcome table. 

Missing values: exclude records with a missing for any covariate in the model 

113 
Measure: Iris prolapse (I) 

Set outcome indicator equal to 1 if this ICD code is found on any record for any setting: 

364.75 Pupillary abnormalities. 

For each cataract surgery patient, search all records in all files (OPD, physician/supplier, 

inpatient), excluding the index procedure file. Search all fields on records included in the 

search. 

Time frame for analysis: Search for outcome within 30 days of procedure date 

Patient characteristics for risk adjustment model: 

•Under 65 years at time of procedure 

• (65-74) 

• 75-84 

• 85+ 

• (Male) 

• Female 

• (White) 

•Afr-Amer 

•Other race 

• (Medicaid eligible) (if buy-in code for any month in 2001 equals “C”, then =1) 

• (not Medicaid eligible) 

•Originally disabled (if OREC = 1 or 3) 

• (not originally disabled) 

Dummy variables for setting: 

Model 1: none included 

Model 2: ASC 

Sample: all cataract surgeries performed in the OPD or in an ASC

Exclusions: 

• beneficiaries not enrolled in Part A and Part B 

• any procedures performed in an office setting 

• any other exclusion used in Phase 1 for the cataract surgery outcome table. 

Missing values: exclude records with a missing for any covariate in the model 

NOTE: please set the outcome indicator to zero for selected cases with 2 or 3 procedures per my 

1/4/06 e-mail. 

114 
Colonoscopy Outcome 

For perforation, you’ll run the following three models on three different samples: 

Model 1: covariates include patient characteristics only 

Model 2: covariates include pt chars plus two setting dummies (ASC, OFFICE) 

Model 3: covariates include pt chars plus two other setting dummies (OPD, ASC) 

Sample 1: all colonoscopies 

Sample 2: all RBC colonoscopies (RBC=lesion removal, biopsy, or control of bleeding) 

36

Sample 3: all non-RBC colonoscopies37

You’ll run a total of 9 models (1 outcome, 3 models, 3 samples) for the colonoscopy outcomes. 

_________________ 

36 The HCPCS/CPT codes for RBC colonoscopy are 44389, 44391, 44392, 44393, 44394, 45379, 45380, 45382, 45383, 

45384, 45385, and 45387. 

37 The HCPCS/CPT codes for “non-RBC” colonoscopy are 44388, 45378, and G0105. 

115 
Measure: Perforation (K) 

Set outcome indicator equal to 1 if these ICD codes are found on any record for any setting: 

998.2 Accidental puncture or laceration during a procedure Accidental perforation by catheter or other 

instrument during a procedure on: blood vessel nerve organ -

E870.4 Accidental cut, puncture, perforation, or hemorrhage during medical care, Endoscopic examination 

569.83 Perforation of intestine

For each colonoscopy patient, search all records in all files (OPD, physician/supplier, inpatient), 

excluding the index procedure file. Search all fields on records included in the search. 

Time frame for analysis: Search for outcome within 30 days of procedure date

Patient characteristics for risk adjustment model: 

•Under 65 years at time of procedure 

• (65-74) 

• 75-84 

• 85+ 

• (Male) 

• Female 

• (White) 

•Afr-Amer 

• Other race Include this variable only in the ALL Colonoscopy and RBC models; drop 

it from the non-RBC models. 

•Medicaid eligible (if buy-in code for any month in 2001 equals “C”, then =1) 

• (not Medicaid eligible) 

•Originally disabled (if OREC = 1 or 3) 

• (not originally disabled) 

•History of partial or complete bowel obstruction (if hcc031 = 1 or any ICD-9 diagnosis 

code on any claim in any setting before the procedure date during 2001 = 560, 560.0, 

560.1, 560.2, 560.3x, 560.8x, or 560.9). 

•History of colorectal cancer (if any ICD-9 diagnosis code on any claim in any setting 

before the procedure date during 2001 = 153, 153.0 – 153.9, 154, or 154.0 – 154.8) 

• Inflammatory bowel disease (if hcc033 = 1 or if any diagnosis code on any 2001 claim 

in any setting before the procedure date = 555, 555.0-555.9, 556, or 556.0-556.9) 

•Melena (if any diagnosis code on any 2001 claim in any setting before the procedure 

date = 578.1) 

Dummy variables for setting: 

Model 1: none 

Model 2: ASC, OFFICE 

Model 3: OPD, ASC 

Analytic Sample 

Sample 1: All procedures 

Sample 2: RBC procedures 

Sample 3: Non-RBC procedures 

Exclusions: 

• beneficiaries not enrolled in Part A and Part B 

• any other exclusion used in Phase 1 for the colonoscopy outcome table. 

Missing values: exclude records with a missing for any covariate in the model 

116 
MRI Outcome 

For the MRI outcome, anaphylaxis, you’ll run the following four models on three different 

samples: 

Model 1: covariates include patient characteristics only 

Model 2: covariates include pt chars plus two setting dummies (IDTF, OFFICE) 

Model 3: covariates include pt chars plus two other setting dummies (OPD, IDTF) 

Model 4: covariates include pt chars plus one setting dummy (OPD) 

Sample 1: all MRIs 

Sample 2: all MRIs with contrast38

Sample 3: all MRIs without contrast39

You’ll run a total of 12 models (1 outcome, 4 models, 3 samples) for the MRI (brain) outcome. 

_________________ 

38 The HCPCS codes for MRI with contrast are 70541, 70542, 70543, 70545, 70546, 70548, 70549, 70552, and 70553. 

39 The HCPCS codes for MRI without contrast are 70544, 70547, and 70551. 

117 
Measure: Anaphylaxis/anaphylactoid reaction (B) 

Set outcome indicator equal to 1 if these ICD codes are found on any record for any setting: 

995.0 Other anaphylactic shock Allergic shock NOS or due to adverse effect of correct medicinal 

substance properly administered Anaphylactic reaction NOS or due to adverse effect of correct 

medicinal substance properly administered Anaphylaxis NOS or due to adverse effect of correct 

medicinal substance properly administered – 

977.8 Poisoning by Other specified drugs and medicinal substances Contrast media used for diagnostic xray procedures Diagnostic agents and kits 

E947.8 Adverse effect from other drugs and medicinal substances Contrast media used for diagnostic xray procedures Diagnostic agents and kits 

For each MRI (brain) patient, search all records in all files (OPD, physician/supplier, inpatient), 

excluding the index procedure file. Search all fields on records included in the search. 

Time frame for analysis: Run two sets of models. First, search for outcome within 7 days of 

procedure. Then, search for the outcome within 30 days of procedure.

Patient characteristics for risk adjustment model: 

•Under 65 years at time of procedure 

• (65-74) 

• 75-84 

• 85+ Include this variable only in the ALL MRI and “without contrast models”; redefine the variable as age>75 for the “with contrast” models. 

• (Male) 

• Female 

• (White) 

•Afr-Amer Include this variable only in the ALL MRI and “with contrast models”; drop 

from the “without contrast” models. 

• Medicaid eligible (if buy-in code for any month in 2001 equals “C”, then =1) 

• (not Medicaid eligible) 

•Originally disabled (if OREC = 1 or 3) 

• (not originally disabled) 

•History of anaphylactic shock (if any ICD-9 diagnosis code on any claim in any setting 

before the procedure date during 2001 = 995.0, 995.6x, or 995.2). Include this variable 

only in the ALL MRI and “without contrast” models; drop from the “with contrast” 

models. 

Dummy variables for setting: 

Model 1: none 

Model 2: IDTF, OFFICE 

Model 3: OPD, IDTF 

Model 4: OPD 

Analytic Sample 

Sample 1: All procedures 

Sample 2: Procedures with contrast 

Sample 3: Procedures without contrast 

Exclusions: 

• beneficiaries not enrolled in Part A and Part B 

• any other exclusion used in Phase 1 for the MRI outcome table. 

Missing values: exclude records with a missing for any covariate in the model 

118 
Mean Predicted Values for Report 

As I’ve mentioned to you, one set of tables in the results section of the report will contain mean 

predicted values for each outcome. This approach entails using the model parameters to 

calculate a predicted value for each case and then calculating a mean predicted value by site for 

each outcome. Because we want means by site, you will use only some of the models with site 

dummy variables to generate the predicted values. 

• For cataract surgery, there are a total of 4 models that need to be run to generate the 

predicted values (4 outcomes, 1 site model). 

• For colonoscopy, there are 3 models that need to be run to generate the predicted values 

(1 outcome, 1 site model, 3 samples). 

• For MRI (brain), there are 12 models that need to be run to generate the predicted values 

(1 outcome, 2 site models, 3 samples, 2 time periods). 

For each of these models, please generate a set of site-specific predicted values for every case in 

the sample for that model, using the parameters (intercept and regression coefficients) from the 

logistic regression model. These can be generated as part of the program that runs the model. 

For each cataract surgery model, you will generate two predicted values for every case, one for 

ASC and one for OPD. To generate the predicted values, use this SAS code shown below. 

proc logistic data=dsname descending outest=beta; 

 model y = inasc var1 var2 ... vark; 

 output out=tmp xbeta=xbeta; 

run; 

data tmp; 

 set tmp; 

 if _n_ = 1 then set beta (keep=inasc rename=(inasc=_binasc)); 

 xbeta0 = xbeta – (X * _binasc); 

 xbeta1 = xbeta0 + _bx; 

 p0 = 1/(1+exp(-xbeta0)); 

 p1 = 1/(1+exp(-xbeta1)); 

run; 

proc means data=tmp; 

 var p0 p1; 

run; 

For each of the three perforation models (all, RBC, and non-RBC), you will generate three 

predicted values for every case, one for ASC, OPD, and office. 

For each of the three anaphylaxis models (all, with contrast, and without contrast), you will 

generate three predicted values for every case, one for IDTF, OPD, and office. 

For each of the three anaphylaxis models (all, with contrast, and without contrast), there will be a 

second set of predicted values for the OPD vs. IDTF/office comparison. For these, you will 

generate two predicted values for every case, one for OPD, and one for IDTF/office. 

119 
Tables for Report 

The attached Excel file contains templates for a total of 13 tables: 

• 3 descriptive tables (based on frequency tables for variables that are in the models) 

• 4 tables of predicted rates (based on specs given above for mean predicted values). You 

don’t need to fill in the chi-square p values. 

• 6 tables of model parameters (intercept, and, for each variable, coefficients, standard 

errors, and p-values directly from the output) 

120 
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