Effects of State Breast Cancer Surgery Inpatient Coverage Laws on Utilization of Outpatient Breast Cancer Surgery in the U.S.

Rationale: State mandated-benefit laws require health insurers to cover particular services. Although such mandated-benefit laws formally affect only state-regulated insurers, they may also have spillover effects on populations enrolled with other insurers by creating a general shift in the standard of practice. Federal mandated-benefit laws, on the other hand, are intended in part to expand benefits to populations exempted from state regulation. However, potential spillover effects from existing state laws may diminish the impact of subsequent federal laws. Objective: This study investigated the potential spillover effects of state laws regulating the minimum length of hospital stay for mastectomy and breast-conserving surgery with lymph node dissection (BCS/LND) on outpatient utilization of these two procedures received by elderly Medicare fee-for-service (FFS) beneficiaries, who are not formally covered by the laws. Methodology: This was a difference-in-differences analysis using 1993-2002 linked Surveillance, Epidemiology, and End Results (SEER) and Medicare data, information on breast cancer surgery laws from states with SEER registries, a health maintenance organization (HMO) enrollment file, and the Area Resource File. The sample included all women aged 65 residing in one of 9 U.S. states, enrolled in Medicare FFS, diagnosed with stage 0-II breast cancer from 1993-2002, and receiving either mastectomy or BCS/LND. The dependent variable was the surgery delivery setting (inpatient vs. outpatient), as determined from claims data. Covariates were patient demographic and clinical characteristics and time-varying county-level variables, including HMO penetration. We used multivariable linear probability models with county and time fixed effects to estimate the impact of mandated-benefit spillover effects on the likelihood of outpatient delivery of mastectomy and BCS/LND, with separate models for each type of surgery. Results: Four states adopted laws from 1997-1999, while the remaining 5 states had no law before 2003. Fourteen percent of 24897 mastectomies were performed in an outpatient setting, compared to 66% of 17579 BCS/LND. Multivariable models suggested that state laws were associated with a significant decrease of 5.0 (95% confidence interval (CI) -7.8 to -2.2) percentage points in the likelihood of outpatient delivery of mastectomy, a reduction of over 36% across the 10-year study period. However, we found no significant impact of the laws on outpatient BCS/LND. In addition, HMO penetration is associated with the outpatient utilization of BCS/LND (but not mastectomy). Specifically, a 10-percentage-point increase in HMO penetration leads to an estimated increase of 6.6 (95% CI 1.2 to12.0) percentage points in the likelihood of outpatient delivery of BCS/LND. Conclusions: The Breast Cancer Patient Protection Act of 2005, a bill introduced into the U.S. Congress, was intended in part to ensure the availability of inpatient treatment options for breast cancer patients enrolled in health plans that are exempted from state laws. (Exempt insurance arrangements include Medicare, Medicaid, and employer-run private health plans.) The findings of our 9-state analysis suggest that the state laws themselves may have a significant population impact on the likelihood of outpatient surgery for breast cancer, by virtue of a possible spillover effect from plans covered by the laws to those that are exempt.