Researchers studied 7,424 privately insured colon cancer patients to see whether economic theory would drive up patient utilization of healthcare services, particularly open resection and laparoscopic surgery. Their analysis revealed that a 10 percent increase of health maintenance organization penetration in a market was associated with a 10.3 percent increase in laparoscopies. They also found that less competition was associated with a lower likelihood of laparoscopy.

Another critical finding revealed increased utilization of laparoscopies translated into lower healthcare costs. Specifically, the average cost for laparoscopy was $18,133 compared to an average cost of $21,257 for open surgery.

"Our results carry important implications for health policy and hospital financing beyond the particular procedure studied," the researchers wrote. "[In] certain cases, adoption of novel procedures may not necessarily drive prices higher, but rather, it may result in price discounts and real savings."

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